How Technology is Helping Advance the South-East Asian Economy
It’s an interesting time to invest in Southeast Asia. Even before the complication of a novel coronavirus, the region was undergoing a period of radical transformation, buoyed by surging support for the tech industry. Thus it’s especially attractive to those trading via online platforms. This trend is being dubbed the fourth industrial revolution – a term credited to the founder of the World Economic Forum, Klaus Schwab.
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This revolution, according Schwab, “is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.” It is already at work on economies across the region, helping to address a broader disconnect between the countryside and the cities, providing widespread access to education, and making cashless payments possible even in remote locations. Often, the geography of this part of the world has proven an obstacle to infrastructure development; but the emergence of the right technology might help to overcome that hindrance.
Leading the way when it comes to investment are ‘deep tech’ start-ups. This is a term which refers to technology with which human beings don’t often directly interact. Artificial intelligence, cryptocurrency and quantum computing might all fall into this bracket.
And there’s no shortage of cash pouring into start-ups which display sufficient promise. Last year in Singapore, the biotech firm RWDC raised $22 million to assist with its development of a biopolymer that might feasibly replace oil-based plastic. Meanwhile in Thailand, the AnyMind Group attracted a similar sum to build their ai-based out-of-home advertising, which uses digital cameras to create personalised billboards, much like in Minority Report.
As it does elsewhere, AI in Southeast Asia displays significant promise. In Malaysia, the start-up Glueck is developing technology which could assess customers by analysing their faces, ages, gender and ethnicity. This will have massive implications in the world of advertising – while throwing up considerable ethical concerns, much like other areas of AI.
The Pressure of Urbanisation
So, what is it about this part of the world that’s driving business of this kind? There are a range of factors to consider, but among the most obvious is urbanisation. In Southeast Asia, residents are flocking from the countryside to the city.
The urban population in the region now sits at around 294 million. In a decade’s time, by some estimates this figure will have swollen to 373 million. The regions biggest cities, with more than ten million residents each, are Manila and Jakarta. But there’s a growing list of cities sitting not far behind, whose populations are set to explode.
Historically, urbanisation is associated with rises in economic growth, and higher living standards. Today, this isn’t always the case – but that doesn’t mean that there aren’t other consequences to be expected from the trend. Such rapid growth is likely to place enormous pressure on public services, and coping with this pressure will require political solutions – and technological ones, too.
Urbanisation presents problems with education, traffic control, energy and healthcare, to name but a few. Administration costs are likely to rise dramatically – and many authorities are looking to pre-empt this problem through digitisation. Cities like Singapore are pioneering new ‘smart’ approaches to city infrastructure, which use digital technologies to minimise costs, and ensure that the gears of commerce aren’t impeded by bureaucracy and poor infrastructure. Foreign investment, direct and indirect, will surely play its role in determining the project’s success or failure.