Axiata Group Berhad is a Malaysia-based telecommunications firm with extensive operations across Asia, including in Cambodia, where it owns Smart Axiata, the leading mobile telecommunications operator. Group chief corporate officer Idham Nawawi, who joined the company in 2013, has more than 20 years’ experience in the telecommunications and IT industries. He spoke to Management Insider about the importance of digital infrastructure to developing countries like Cambodia and how ASEAN countries need a “revolution” in their policies to foster digital economies.
What role does digital infrastructure play in the development of a country? How important is it to a nation’s success and prosperity?
Digital infrastructure or broadband infrastructure is not only critical but fundamental to the economic development of any country. World Bank studies show that for a developing country like Cambodia, every 10% increase in broadband investment results in a multiplier effect of up to 1.37% in GDP growth. Clearly, quality broadband coverage and network is a significant boost to economic growth, making positive impacts on the way we live and work. In some economies that enjoy superfast broadband speeds, we see rapid acceleration of business productivity, especially in the areas of automation. We also see the creation of new and innovative services for consumers such as e-commerce, digital advertising and media content; as well as broadband enabling enterprises to maximise operations in outsourcing, call centres and new export markets.
How have you seen ASEAN’s Internet landscape change over the years?
At the ASEAN level, the telecom and ICT ministers have the ASEAN ICT Masterplan 2020, which recognises that ASEAN is now transitioning toward a digital economy. With that, ICT and the Internet infrastructure have become core to the economy and will have a positive impact on socio-economic growth and development.
We also see dynamic changes in consumer behaviour. In a region of naturally sociable people, ASEAN communities have become voracious consumers of social media, recording the highest social network usage in the world with Facebook being the key driver of growth across the region. ASEAN’s social media usage averages 49% against a global average of 37%. This will drive the demand for data volume to 2.5 million terabytes in ASEAN countries, which means we can expect cumulative investment of over $46 billion to be poured into telecommunications by 2019.
World Bank studies show that every 10% increase in broadband investment results in a multiplier effect of up to 1.37% in GDP growth. Clearly, quality broadband coverage and network is a significant boost to economic growth.
In terms of e-commerce, a 2015 study by Google/ Temasek revealed that the e-commerce market for ASEAN will increase by 16 times, from a base of about $5.5 billion, to $88 billion by 2021. This is a huge upside and the phenomenal growth is enabled by many factors including availability of mobile broadband everywhere.
Do you think ASEAN’s developing countries are doing enough to foster and promote their digital economies?
ASEAN countries are doing a lot but there is certainly a lot more we can do to “think as a bloc” and create an environment that will foster inclusive and sustainable growth to capitalise and leverage on the global digital momentum. Policymakers and stakeholders in government need to take a frm and clear position in pursuit of fostering a vibrant digital economy within ASEAN. It has to be made into a national agenda – a case of revolution as opposed to evolution. We cannot wait for the ASEAN digital economy to slowly evolve and grow; we have to make high-impact change quickly. New and bold forward-looking policies need to developed, while existing regulations need to be reviewed and, where necessary, removed to unleash greater innovation. This is what we mean by a revolution. Broadband, therefore, is fundamental, and a proper and sustainable industry structure in each market is vital.