Over recent years, we have seen the rapid growth of the Digital Economy. Based on a report from the U.S. Department of Commerce, the U.S., being the largest global exporter of services, exported about $400 billion in digitally deliverable services in 2014. This represented 56 per cent of U.S. service exports and about 17 per cent of total exports.
The Internet was acknowledged to be the single largest component of the cross-border trade in services.
The most significant growth opportunities for the U.S. are available in the international markets.
Global business to consumer e-commerce transactions totalled at $1.9 trillion in 2014.
Malaysia would also ride on the same digital phenomenon, where digital deliverable services have started to grow in the country. Malaysia’s investments in the past such as Multimedia Super Corridor and National Broadband Initiatives have created an excellent platform for the Digital Economy.
The Digital Free Trade Zone (DFTZ) launched by Prime Minister Datuk Seri Najib Tun Razak together with Jack Ma of Alibaba Group showcased the world’s first special trade zone, targeted at SMEs to spur the growth of e-commerce.
The first of its kind e-hub outside China, the Prime Minister said that today, 97 per cent of our businesses are SMEs, contributing 37 per cent of the GDP. But with a shot in arm from initiatives like the DFTZ they could contribute from 60 to 80 per cent.
While leveraging on international digital trading platforms, Malaysians are also urged to nurture our very own technologies in the digital realm. The Ministry of Science, Technology and Innovation, through MIMOS our national ICT R&D Centre, is particularly looking into Internet of Things (IoT) and Big Data Analytics (BDA).
The National IoT Strategic Roadmap was rolled out in 2015, with several programs being realised and in the pipeline, such as to digitalise identification, transaction signing and the traceability of a product.
Another system is the Smart Community Infrastructure System or iComm, where rural communities get to enjoy the boom of digital economy. This system has been implemented in Sabah, with plans to be extended to the rest of the country.
Villagers benefiting from the facility could have free Internet access and free phone calls.
It also has a closed circuit television network, could monitor river and flood levels, and provide Internet-based mobile communications for the safety of residents and even border security.
BDA on the other hand, is used by businesses and governments to examine large volumes of data to unearth hidden patterns and insights to help them make informed decisions. MIMOS hosts a BDA Lab and a Big Data IoT Technology Accelerator Lab, which serves as a technology reference centre for the industry.
However, with the generation of more data, the availability of sensors, devices and applications, there are increasing trust and security issues in the digital world. Cyber espionage, hacktivism, malware infection and cybercrimes top the cyber threat list. Hackers take advantage of digitalisation to make profits by stealing secrets and corporate data, and launch attacks on critical infrastructure.
Therefore businesses hoping onto the e-commerce bandwagon should integrate security and privacy safeguards that extend to their consumers.
CyberSecurity Malaysia is the central agency for cybersecurity in the country, as their computer emergency response team or MyCERT offers round the clock computer security incident response services to any individual, company, government agency or organisation. The public can reach out to them via the Cyber999 Help Centre detailed in their website.
The future of Internet Economy has to be inclusive. Lately I met Jack Ma twice – the first in Davos during the World Economic Forum Annual Meeting, and once again when he spoke at the Global Transformation Forum in Kuala Lumpur. Listening to the mind behind the billion-dollar technology and e-commerce behemoth first-hand was surreal – he was very visionary, humble, and all for inclusivity.
He highlighted the role of women in his company. Over half of the employees were women in 2015; 23 per cent of the senior management were women, and they have had a female chairman, chief executive officer, chief financial officer, engineers – the list goes on. He embraces gender diversity in his organisation, and has said that women think about others more than for themselves, which just might be the key for Alibaba to serve her customers well.
“We are now in the era of women.”
The future of digital economy in Malaysia is promising. A week ago Lazada Malaysia was reported to have overtaken its counterpart in Singapore to become Southeast Asia’s fastest-growing e-commerce platform.
About 15,000 merchants used this e-platform last year, and another 25,000 are expected to join the club this year.
But we still have a lot of catch up to do with other more mature, higher fuelled digital economies in the region.
Sabahans should seize the opportunities emerged during this digital revolution, be it through e-commerce, or enabling processes such as IoT and BDA, with an emphasis on security and inclusivity.