Digital Asia: Paths to digital transformation in Singapore, Vietnam and Philippineshealthcare security fintech iot mobile banking financial-services
Financial technologies — particularly around new lending models, mobile payments and blockchain — generates significant attention and investment in the three South-east Asian countries. Beyond fintech, each of these countries has other distinct sectors from which digital industries are being built:
- Singapore's government's well-managed and comprehensive civil bureacracy has been a catalyst for smart city and transportation technologies and applications
- The Philippines has an incredibly vibrant IT-enabled Business Process and Knowledge Process Outsourcing (BPO & KPO) industry, which dovetails with a healthcare competency, in turn generating innovation around telemedicine and ehealth device development.
- Vietnam's digital economy is centered around manufacturing, but there is an increasing amount of innovation and entrepreunerialism around communications and security applications development
The ASEAN Economic Community (AEC) will likely create some digital infrastructure initiatives at a cross-governmental level, but progress will be slow. More important for regional digital development will be two other factors: rapid expansion of South-east Asia's venture capital industry (largely headquartered in Singapore) and the digital knock-on effects of China's "Belt and Road" transportation infrastructure investments in the region.
There is strong commitment to build digital capabilities in each of the three ASEAN countries surveyed in this report. Moreover, each has fast-growing technology entreprenuer sectors, particularly around Fintech. Those seeking to invest in the region, or use it as a platform for international expansion, however, should also be aware of potential limitations in each market:
- Singapore's government support, in terms of planning, regulation and direct investment, is strong—perhaps too strong. There is a danger that too much incubation may smother innovation.
- Vietnam has successfully transformed its export manufacturing sector through an industrial zone development strategy. Relying on this model is not as useful for software and applications development. Vietnam's government has also created ASEAN's most restrictive Internet content environment.
- The Philippines, due to its touchy relations with China, will probably not enjoy much of a "Belt and Road" boost. Its IT development policies are heavily weighted towards job creation, and this may stunt digital innovation in an ecosystem which seeks efficiency and process automation.