The role of Chief Financial Officers (CFOs) has moved beyond traditional financial and accounting supervision. They now operate in the centre of the organisation delivering relevant insights on business performances that underpin and guide the entire company functioning. CFOs are increasingly becoming key advisers to business, making near real-time, data-enabled decisions.
As data becomes more distributed, dynamic and diverse, data no longer resides in a single enterprise repository. Instead, it is likely to be housed and processed in multiple parallel operating locations, such as ERP systems, billing systems or commerce platforms.
It is imperative to develop advanced forecasting capabilities and new finance management technique which provides the opportunity to take analytics capability and data beyond the finance function to support the enterprise holistically.
Along with developing new talent and skillsets, and through investment in technology, using analytics in finance enables CFOs and finance teams to generate a competitive advantage and growth for the entire enterprise.
Analytic Process Automation (APA) is the key. APA enables easy data sharing, automates tedious processes and unlocks predictive insights that drive timely attainment of goals. It eliminates the need to use multiple discreet tools to manage data, processes and people, making it easier and faster for governments to take care of the citizens.
APA is an effective tool for the public sector industry to track and fight the pandemic outbreak, improve data accountability, increase transparency in procurement and facilitates effective disaster recovery and relief.
By intelligently automating the hundreds of repetitive and complex analytic processes, the finance team can save hours of manual work and be able to spend more time on delivering vital outcomes. On top of that, the accuracy and flow of data would significantly be improved in its operation as APA streamlines entire data-driven processes in a preferred consumption format.
The full visibility of data across key financial management systems enables every function in the finance team to take advantage of data and easily collaborate across departments, where the analytic effort can be shared and reused.
Knowing this, the core question remains: how can CFOs and the finance team leverage Analytic Process Automation without dependencies on the IT department?
This was the focal point of the OpenGovLive! Virtual Breakfast Insight held on 09 June 2021. The event aimed to impart knowledge on the democratisation of data and analytics in the office of finance and explore best practices to achieve a culture of analytics, upskilling of employees and service efficiency.
The session served as a great peer-to-peer learning platform to gain insights and practical to implement Analytic Process Automation to enable more efficient data processing while reducing the complexity and cost.
Digital Transformation Within the Office of Finance
Mohit acknowledged that life in financial organisations is filled with challenges. Financial officers juggle many roles, responsibilities and requirements. Not only do they need to understand the numbers, but they are supposed to make sense out of those numbers.
At the same time, technology is moving so fast and comes at a significant cost. Previously considered a somewhat unnecessary expense, tech has now become the backbone of every business. In these current times, organisations welcome technology as an investment.
Along with the rise in technologies, more data than ever before is being collected. But in and of itself, data can do nothing. Mohit emphasised users must fully understand what data can do for them. Data must be unlocked to achieve better business outcomes.
Most people do not know where to start – that is where problems come from. Users need to investigate the depth and scale of data and not merely play on its surface. Data must be democratised through three mega pillars: comfort, tools and culture. Financial offices need to understand that data must be democratised and made accessible so more people can use it.
Organisations from all over the world came up with a slew of ad-hoc solutions and band-aid technologies to further their digital transformation journeys during the pandemic. Digital initiatives and tech platforms were launched left and right but COVID-19 taught us that there is room for change.
Mohit emphasised that this is the time to recognise what organisations can automate and this is the perfect time for comprehensive digital transformation.
In closing, Mohit urged the delegates to find the right partners for their data and digital journey. If they want to stay ahead of the curve, it is vital to work with experts who can guide them along the right path.
The Convergence of Data, Process and People
After the opening address, the session heard from Philip Madgwick, Regional Director (ASEAN), Alteryx, who talked about the state of the analytics market and the journey to analytic process automation.
He believes that the process of utilising data is built on three key pillars. First is the idea of data democratisation which means making data accessible for anyone in the organisation to drive digital transformation initiatives. The second is process automation that ensures that the organisation can automate repetitive processes, increasing overall efficiency and decision-making. Thirdly is upskilling that promotes the improvement and capabilities of people handling the data within the organisation.
For Philip, CFOs have a unique vantage point that ensures investments are aligned to outcomes and growth. The process starts with purchasing, spending on analysis and vendor management. Next are business units, margin erosion analysis, pricing analytics, service level and customer profitability alignment.
Sales and marketing also come into play. Price-point, revenue leakage, revenue driver, demand/price elasticity, customer retention and churn analyses are vital in the process. Another one is the supply chain. Sales and finance-linked forecasting, new product introduction, profitability and dollarisation effect. Lastly, is IT or the organisation’s technological investment planning and prioritisation.
With these steps, financial offices can ensure an efficient operational execution from operational decision-making, strategic decision-making and driving profit lost in operational execution.
There are, of course, organisational challenges that stand in the way of achieving these desired outcomes. A disconnected approach between data, process and people prevents ideal outcomes. Challenges also include limitation of data, slow data curation, analytics and data science, processes that are manual and unoptimised, disjointed and unengaged people with no sign of upskilling.
To rise above these challenges, Philip emphasised that the three pillars – data, process and people – must converge into one priority. Data and analytics must be open to democratisation to allow easier access to data and automated machine learning for analysts and data scientists. Automating processes is key to minimise manual intervention, achieving high efficiency and minimal error.
Last but not least, is upskilling people. Governments must have a robust analytics community, enriched step by step with a classroom curriculum and by utilising intuitive and engaged platforms to help build confidence among the workforces.
To end his presentation, Philip shared how Alteryx automates an Office of the CFO. It starts with tax automation, risk, audit and compliance monitoring and optimising accounting and operations. By automating these processes, the office of finance saved on resources like manpower hours and allowed them to focus on tasks that require more human intervention.
Philip is positive that the automation procedure helps organisations in advancing their digital transformation journey. He conceded that the office of finance must continuously embrace the innovation of the three key pillars of digital transformation moving forward.
Analytic Process Automation for Finance Functions
The delegates moved to a presentation from Rinrat Pasavekin, Partner, PwC Thailand. She discussed the process of delivering actionable insights with Analytic Process Automation in the office of finance.
Rinrat is firm in her conviction that the office of finance needs to transform its processes. She emphasised that finance is perversely impacted by several global trends creating an urgent need for finance to transform to better support the business.
Typical triggers for transformation are:
- Workforce Skills Gap (Source and retain new skills, Managing an ageing workforce)
- Emerging Technologies (Siloed information systems, Increasing data volumes)
- Investor / Cost pressures (Decrease costs to serve, Business enablement)
- Reporting and Analytics (Integrated information, Improved decision making)
Typically, the office of finance responds to these triggers by exploding data volumes, changing regulations, radical automation, industry convergence, settling with unstructured data and building B2B to B2C business models.
Rinrat believes that the office of finance’s digital transformation is enabled by a seven-point Modern Finance Agenda. She underlined that this agenda requires a strategic shift in the operating model to be digitally enabled:
- Finance Workforce of Future
- Finance Organisation and Structures
- Process Excellence and Automation
- Cloud ERP and Digital Platforms
- Automated and Predictive Controls
- Advanced Analytics, Insights and Action and,
- Insightful Finance Business Partnering
In her experience, clients have a proclivity driven by their culture, values and objectives which drives their focus on what key aspect to start their digital transformation on. Ideally, finance offices must start leading with people, leading with the process and ultimately leading with performance.
Leading with people involves a digital finance workforce. Upskilling finance workforces to be digitally savvy and supplemented with new human and machine-based roles. It also deals with modern finance workplaces. Re-thinking collaboration spaces and structures for finance employees and external parties (e.g., suppliers).
Leading with process means utilising intelligent automation. Finance organisations must learn to apply automation to simplify, accelerate, or re-design processes. The capability to predict enterprise risks is also key. Applying automation to rationalise and re-design control structures to shift from detective to predictive controls must be focused on. Lastly, is utilising a pre-configured Cloud ERP, shifting and upgrading the existing ERP to deliver new finance capabilities in public/private clouds.
Leading with performance on the other hand is by using a connected, self-service data, enabling the enterprise’s digital core by connecting ERP/EPM tools, data lakes and self-service, voice-activated information supported by Artificial Intelligence (AI). Assisted insights and performance must also be looked upon. Applying analytics and machine-based models to deliver business function insights and financial planning and analysis improvements will help a finance office in any organisation in a big way.
She acknowledged that there are certain challenges in trying to implement digital transformation within the office of finance. One is identifying and consolidating data, which takes a lot of time and resources. Another issue is that data owners may be hesitant and/or unable to provide quality data.
Rinrat advised the delegates to always evaluate the integrity and organisation of current data for them to recommend the accurate timeline and they must look to reach out to required data resources as quickly as possible. With leadership support, they can further the office of finance’s digital and data journey.
After the informative presentations, delegates participated in interactive discussions facilitated by polling questions. This activity is designed to provide live-audience interaction, promote engagement, hear real-life experiences and impart professional learning and development for participants.
The opening poll asked how delegates would rate their organisation’s use of data and data analytic tools for decision-making. Half of the delegates (50%) said that it is fair and they use data in their decision-making process. However, they acknowledge that the analysis is primarily a manual process as they do not have enough data analysts/scientists. About 28% said it is good and they have some tools in place but are still learning how to optimise them fully. Just over a fifth (22%) indicated that it needs improvement and they need better tools to analyse and are currently relying mainly on Excel.
The delegates were asked what they consider the greatest barrier to integrating more data and analytics into their day-to-day decision-making? A third (32%) indicated that the lack of trained people to do actual analysis is the greatest barrier. Around 29% conceded that they have limited access to data because they are kept in silos or disparate locations while 21% said that the available data are not accurate or updated.
The next poll was about the delegates’ top drivers of data and analytics usage in their respective organisations. About 43% acceded that removing inefficiency in processes and speeding up decision-making is their desired outcome, 39% said that achieving better organisational decisions and outcomes are the main drivers, while 11% said that ensuring compliance with laws, rules and policies is their main priority.
On being asked what their biggest barrier to progress in their organisations’ data journeys was, more than half of the delegates (54%) said that the disconnect between IT & business / organisational requirements is the biggest hindrance. Just over a fifth (21%) said that poor quality and availability of data causes them to further their data journeys, while 11% said that a non-data-literate workforce is the biggest barrier.
The delegates voted on four strategies that they are thinking of implementing or interested in. A significant 43% are interested in reviewing existing processes and identifying which ones can be automated and can be made more efficient. A shade over a third (35%) are contemplating upskilling thei workforce to scale use of data analytics on their own, while 11% are interested in consolidating current analytic tools to simplify adoption across the entire organisation.
In terms of their strength in the use of data analytics, about 31% of the delegates said that understanding, support and commitment from top management remains their biggest strengths. A quarter (26%) voted for the deployment of powerful tools and efficient process to facilitate good data analytics projects, while another 26% of the delegates said that deriving meaningful insights through data analytics is their biggest asset.
The session concluded with closing remarks from Philip and Rinrat.
Philip reminded the delegates to always focus on the three key aspects- data, people and processes – in their digital transformation journeys. He further advised the delegates who were just starting their digital transformation journeys to remember that they can always reach out for partnerships; not just to Alteryx, but to other service providers. Organisations who were well on the path to a true digital transformation would also make great advisers.
Rinrat thanked the delegates for attending and the wonderful time of discussion. She stressed that true digital transformation involves partnerships that ensure an organisation’s desired outcomes. She invited delegates to contact PWC for any concerns, especially those regarding finance offices’ data and digital journeys.
Digital transformation made remarkable progress last year, with technology awareness among state agencies, businesses, and citizens significantly improving, according to the Deputy Minister of Information and Telecommunications, Nguyen Huy Dung. He stated that digital transformation has become a trend in the wake of COVID-19. It is a new engine driving the country’s socio-economic development and facilitating virus response and economic recovery. Digital technology has found its way into every governmental, economic, and social activity.
According to a news report, there has been a surge in digitisation across the country. In Da Nang, residents can register for electricity supply and pay power bills via their smartphones. Village chiefs in Lang Son are leading community-based technology groups that teach the villagers how to develop digital shops on e-commerce platforms, helping raise sales of agricultural products 174 times. In Quang Ninh, the chairman of the provincial People’s Committee has deployed a digital system to check the progress of public administrative services delivery.
An industry expert stated that at an early stage, the national digital transformation and the journey towards a digital economy and society still have a long way to go. Every person and business is increasingly aware of how digital technologies are profoundly changing the delivery of public administrative and healthcare services. The national portal for public administrative services has been operational for over a year, with nearly 3,000 services made available.
The remote medical consultation and support network Telehealth, which connects around 1,000 clinics nationwide, has bridged the gap in service quality among regions and reduced overloads at centralised hospitals. Many hospitals now provide digital health records, remote health services, and e-payments.
Do Cong Anh, the Director of the Ministry of Information and Telecommunications’ Information Technology Application, emphasised that it is not only about technology and equipment but also regulatory frameworks, policies, awareness, and personnel. Technology contributes some 20% to an organisation’s successful digital transformation while the remaining 80% depends on its awareness and how its personnel translates digital plans into reality, according to Anh.
By 2030, Vietnam sets to develop an e-government and digital economy which contributes around 30% to the GDP. The country also aims to be among the top 50 countries in e-government development and the third in ASEAN by the end of this decade. Vietnam is expected to be the fastest-growing e-commerce market in Southeast Asia by 2026, with e-commerce gross merchandise value (GMV) reaching US$56 billion by 2026, 4.5 times the estimated value of 2021.
Vietnam is at the forefront of driving change and seizing opportunities to thrive based on digital transformation in a post-pandemic future. A study surveyed about 16,700 digital consumers and more than 20 C-level employees in six Southeast Asian countries, including 3,579 survey participants from Vietnam. The report described Southeast Asia as a leader of digital transformation in the Asia-Pacific region and Vietnam as one of the best performers.
Four research projects led by scholars at City University of Hong Kong (CityU) received grants worth HK$20.26 million in total from the inaugural Green Tech Fund under the Environmental Protection Department, Hong Kong SAR Government.
Established with an allocation of HK$200 million from the Government’s 2020/21 budget, Green Tech Fund aims to boost the research into and development and applications of decarbonisation and green technologies. Addressing issues on decarbonisation, energy efficiency, green transport and air quality, CityU joined with local industries and government departments to expedite low-carbon transformation in Hong Kong.
The project led by Chair Professor of Electrical Engineering received funding worth approximately HK$6.69 million. The objective is to develop a smart power conditioner (SPC) by reusing obsolete electric vehicle (EV) batteries, termed second-life batteries. The overall aim is to improve the power quality and energy efficiency within the electrical distribution network and meet the growing demand for charging EVs.
With an artificial intelligence (AI)-empowered diagnostic framework, the SPC system can estimate the remaining useful life of batteries and the health condition of major power components in the SPC through online monitoring. In addition, the system can help reduce electronic waste by controlling the charging and discharging profiles of the batteries to prolong their life. It can also reduce the power loss of the entire electric distribution network, and solve the frequent failure problems experienced by the power capacitor in the passive harmonic filter and capacitor bank.
A grant of approximately HK$ 5.69 million was awarded to the project led by the Dean and Chair Professor of Atmospheric Environment in the School of Energy and Environment (SEE). The research team will develop two types of portable low-cost sensors for the real-time monitoring of volatile organic compounds (VOCs) in the air. Poisonous VOCs are key precursors of the ozone and suspended particulates that generate photochemical smog.
The two sensing systems that the team plans to develop will be mini metal-organic framework-based photoionisation detector sensors and metal oxide semiconductor sensors; and a portable thermal desorption-gas chromatograph-photoionisation detector system. These systems, which entail lower production costs than existing commercial monitoring devices, will help Hong Kong achieve decarbonisation targets and enhance air quality by controlling the emission of VOCs. In addition, they can be easily installed and are flexible enough for various mobile platforms that monitor VOCs at different horizontal and vertical scales.
The project led by the Director of Hong Kong Institute for Clean Energy and the Professor of Materials Science received funding worth HK$5.03 million. His team will develop highly efficient printable perovskite solar cells (PSCs) to help Hong Kong become a leading city in developing technologies for solar energy.
By developing perovskite as appropriate “ink” for printing films directly on crystalline silicon solar cells, the team aims to produce high-performance perovskite/crystalline silicon tandem solar cells that have 30% higher power conversion efficiency than conventional silicon cells. This technology can enhance the efficiency of photovoltaic systems installed on rooftops. In addition, the team will develop semi-transparent PSCs that can be used as solar windows for building-integrated photovoltaics.
The team consists of top perovskite scientists and experts in printable PSCs. It was noted, currently, more than 85% of energy in the world comes from non-renewable sources. Scientists should therefore bear the responsibility of developing new materials and technologies that will provide highly efficient and sustainable clean energy.
The Associate Professor of SEE was granted approximately HK$2.88 million for his project. Given the prevalent trend for developing green energy through the use of solar energy and water to generate hydrogen, the research team will develop a novel and large-scale photocatalyst panel for solar hydrogen evolution using water from various sources.
The team will put bismuth-based photocatalytic powder developed by Dr Ng on stainless steel plates with a transparent window as an outer frame for receiving sunlight. A thin layer of water (less than 1 cm) will be filled within the photocatalyst panels to generate hydrogen. The clean hydrogen produced by sunlight and water can generate electricity for small indoor devices.
China will promote the process of digitalisation in banking and insurance to heighten high-quality development of the sectors, the country’s banking and insurance regulator has said. Banking and insurance institutions should implement supportive digital development plans to better serve the real economy, according to a guideline recently issued by the China Banking and Insurance Regulatory Commission.
Digital transformation of business management, industrial and personal financial services, and the financial market should be strengthened. Meanwhile, more should be done to improve the data governance system as well as management, quality control, and application of data. The guideline also said that institutions should tighten management against risks, enhance data security and improve privacy protection.
China’s latest plan to grow its digital economy will empower national digital transformation, shore up innovation and enable the government to offer more equitable public services. The State Council, China’s Cabinet, unveiled the first five-year plan on the digital economy on Jan 12, highlighting the sector’s role in reshaping the global economic structure and international competition, and rolling out targets for its development through 2025.
The plan laid out measures for upgrading national infrastructure, bolstering the role of data as a production element and promoting the digital transformation of industries. By 2025, the added value of core digital economy industries is expected to account for 10% of GDP, up from 7.8% in 2020.
The plan also pledged to further open up China’s service sector, explore measures to widen market access for new business models in the digital economy and promote globalized development for emerging services such as data storage and cloud computing.
The plan has set a target of increasing China’s gigabit broadband users from 6.4 million in 2020 to 60 million in 2025 and promoting more commercial and large-scale use of 5G. According to the National Development and Reform Commission, China has developed the world’s largest optical fibre network and has the largest number of internet users, a total of 1.01 billion as of last June.
It also leads the world in the development of 5G, with a total of 1.39 million base stations and 497 million 5G device users as of last November, and it has been the world’s largest online retail market for eight consecutive years, with online sales volume hitting 6.1 trillion yuan ($961 billion) in the first half of last year, up 23.2% year-on-year.
A key focus of the initiative is to shore up innovation capacity in key technologies, as the country seeks to boost the research and development of sensors, quantum information, telecommunications, integrated circuits, key software, big data and Artificial Intelligence (AI).
China will continue to promote the healthy growth of the platform economy, encouraging companies to step up the integration and sharing of data, products and content and expand services such as online healthcare. New growth areas in the sector, such as smart sales, unmanned deliveries and smart manufacturing, will also be promoted.
As reported by OpenGov Asia, stronger tech innovation capabilities are facilitating industrial growth in China, which will help further the high-quality development of the nation’s sprawling manufacturing sector. The remark came after China’s industrial output increased 9.6% on a yearly basis in 2021, 1.5 percentage points higher than GDP growth, according to the National Bureau of Statistics.
More capital is going to the high-tech sector, which will also fuel the in-depth integration of the digital and real economies, and facilitate the high-quality development of manufacturing in China. Last year, investment in high-tech industries increased by 17.1%, 12.2 percentage points faster than total investment. Among the total, investment in high-tech manufacturing and high-tech service industries increased 22.2% and 7.9% year-on-year, respectively.
As cyber threats increase, becoming ever more sophisticated and evolving to match cyber resilience measures, new approaches and strategies are needed. Traditional ideas and methods that protect a tangible periphery no longer work, more so in the increasingly common remote workforce. These plans cannot be static but must be revisited periodically, upgraded frequently and monitored constantly.
Organisations that support the public and private sectors must be far more proactive than before, keeping a vigil on bad actors, both internal and external, foreign and domestic. Cyber resilience systems must learn to adapt to ever-morphing and clever attacks against core systems, infrastructure and equipment.
The cyberattack on the SolarWinds software build environment in December 2020 emphasises how dangerous the current landscape is and how concerned cyber resilience teams should be. The risk is no longer limited to a department or organisation but now threatens entire national functioning.
There is no doubt broad consensus and common development of sound practices across industry and government. Firm in their belief that transparency and cooperation are the best tools to help prevent and protect against future attacks, SolarWinds remains committed to sharing their learnings from the attack. Secure by Design is their guiding set of principles, with a focus on people, infrastructure and software development.
Their whitepaper, Setting the New Standard in Secure Software Development: The SolarWinds Next-Generation Build System is an excellent resource. Read on the learn more on software development and the build process improvements they’ve made in an accelerated timeline this year.
The Directorate General of Higher Education, Research, and Technology (Ditjen Diktiristek) of the Ministry of Education, Culture, Research, and Technology (Kemendikbudristek) is working with a tech company to develop Indonesian digital talents in the field of Artificial Intelligence (AI). The cooperation is stated in a Memorandum of Agreement (MoA) signed by both parties through a virtual ceremony. This collaboration is an effort made by the Directorate General of Higher Education to accelerate the growth of AI talent in Indonesia.
The scope of the collaboration includes improving the competence of human resources at Indonesian universities, through various activities such as AI skills training for lecturers and students, AI curriculum development in universities, translation workshops and research discussions, as well as development and support for the AI startup ecosystem.
Acting (Plt.) Director-General of Higher Education, Research, and Technology Nizam said, the Directorate General of Higher Education is committed to improving the quality of human resources (HR) of higher education, especially in the field of digital technology. This is in line with President Joko Widodo’s direction to prepare millions of Indonesian digital talents to respond to digital transformation.
It is important for us to ensure that our young generation can face this era of the industrial revolution 4.0, especially with the competencies of AI, machine learning, deep learning, and other fields that this industry needs.
– Nizam, Acting (Plt.) Director-General of Higher Education, Research, and Technology
On the same occasion, Plt. Secretary of the Directorate General of Higher Education, Research and Technology Tjitjik Srie Tjahjandarie said that the process of signing this cooperation agreement was the first step to prepare the next generation who are ready to compete and contribute to the development of technology-based multidisciplinary education in Indonesia. Through this program, it is hoped that the development of technology-based education can be evenly distributed in all universities in Indonesia.
This cooperation agreement can be a motivation to develop the abilities of students and alumni as well as the quality of lecturers and teaching staff in universities. In addition, through this development, a superior university curriculum can be created and is suitable for facing challenges in the changing industry 5.0 and 6.0.
Everyone should understand the implications and impact of AI, regardless of the field of study they study because AI can change almost any sector of the economy. The challenge is, not only do people have to focus on science, but people have to bring awareness about AI more broadly across sectors and industries.
As reported by OpenGov Asia, the Minister of Communications and Informatics Johnny G. Plate encourages everyone to continue to improve their quality of life in line with the projected number and types of new jobs due to technology adoption. It is projected that there will be 85 million old jobs that may be lost and 97 million new jobs that may appear, this is due to the division of labour between humans, machines and algorithms. The new jobs require a high level of digital skills and soft skills.
A report shows that in 2025 there will be 43% of industry players who reduce or reduce the number of workers as a consequence of the application of technology integration. Increasing digital skills and soft skills in line with technological developments for the workforce, especially the younger generation of Indonesia, can be done through upskilling and reskilling.
In addition, the Government has also carried out massive infrastructure development, especially in the first period of President Joko Widodo’s leadership. According to the Minister of Communication and Informatics, entering the current era of digital transformation, the development of digital infrastructure has been and is being accelerated by the Government and its partners and needs to be balanced with improving the quality of human resources.
Singapore and the Republic of Colombia have signed a Memorandum of Understanding (MOU) to deepen economic ties between the two countries and promote closer collaboration between Singapore and Colombian companies. Businesses in Singapore and Colombia will have more opportunities to collaborate in areas such as technology and innovation.
This is the first bilateral MOU between ESG and ProColombia, the government agency in charge of promoting the export of goods and services, foreign direct investment, and tourism. Under the MOU, ESG and ProColombia will work together to facilitate business partnerships between Singapore and Colombian companies, in key areas of technology and innovation (emerging technologies such as Industry 4.0, Artificial Intelligence (AI), Internet of Things (IoT), blockchain and digital industries), trade, infrastructure (smart city and smart governance) and energy.
This MOU builds on Singapore’s economic relations with Colombia and affirms our commitment to work together. The consumer, trade and infrastructure sectors are important growth drivers of the Colombian economy. The country is also making inroads into technology and innovation. With Colombia also a part of the Pacific Alliance, this MOU will facilitate Singapore companies with aspirations to diversify to Latin America as well.
– Tan Soon Kim, Assistant Chief Executive Officer, Enterprise Singapore
Colombia is Latin America’s fourth-largest economy, with a gross domestic product (GDP) of US$683.9 billion (S$920 billion). It is expected to grow 5.5 per cent this year. The country was Singapore’s sixth-largest trading partner in Latin America and the Caribbean last year, with total trade in goods amounting to $327 million – a 17 per cent increase from 2020.
The Colombian government has a special interest in strengthening trade and investment ties with Singapore, a key partner for its expansion to the Asia-Pacific region. Singapore’s regional leadership and strengths in areas such as urban and airport infrastructure and logistics.
There are some examples of Singapore companies that have successfully expanded into Colombia. The company is among the top five coffee exports in Colombia with seven warehousing and three processing facilities in the country.
Technology solutions company was commissioned by the Inter-American Development Bank in 2016 to connect the Single Electronic Windows for Foreign Trade of the Pacific Alliance Countries. This involved developing a customised interoperable solution that allows the Pacific Alliance countries to exchange, validate and mutually accept data, permits and authorisations in real-time to increase the efficiency and transparency of the foreign trade in the region.
As reported by OpenGov Asia, Singapore and the Republic of Korea (ROK) have launched negotiations on a new Korea-Singapore Digital Partnership Agreement (KSDPA) last year. The agreement seeks to deepen bilateral cooperation in new emerging digital areas, such as in personal data protection and cross-border data flows, digital identities, fintech, as well as Artificial Intelligence (AI) governance frameworks. It also aims to support and foster greater collaboration between both countries’ SME communities in the digital economy.
Recently, Singapore and ROK have concluded negotiations on the Korea-Singapore Digital Partnership Agreement (KSDPA). The KSDPA will be Singapore’s fourth Digital Economy Agreement (DEA), and the first with an Asian country. The agreement will deepen bilateral cooperation in the digital economy between both countries, by establishing forward-looking digital trade rules and norms to promote interoperability between digital systems. This will enable more seamless cross-border data flows and build a trusted and secure digital environment for our businesses and consumers.
The KSDPA is part of a series of DEAs that Singapore has embarked upon. These agreements are an inter-agency effort led by the Ministry of Trade and Industry, Ministry of Communications and Information, and the Infocomm Media Development Authority, to advance collaboration in the digital economy and enhance digital connectivity.
The Internet infrastructure in the country is set to receive considerable investment in 2022 to meet users’ growing demands. The number of Internet subscriptions in Vietnam hit a record last year with nearly 71 million mobile broadband subscriptions and 18.8 million fixed ones. Respectively rising 4% and 14.6% from 2020. Internet users accounted for two-thirds of the population. Internet traffic also grew strongly, by over 40%, in 2021.
Telecom businesses stepped up developing broadband infrastructure. So far, the 5G network has been piloted in 16 provinces and cities, 4G covers 99.8% of the population, and cable Internet services reached 100% of communal-level localities. This is according to data from the Authority of Telecommunications, which runs under the Ministry of Information and Communications (MIC).
Although there has been steady growth, repeated breakdowns of undersea international cables greatly affected the domestic Internet quality. There are five undersea cable routes currently operating in Vietnam, namely AAG, SMW3, IA, APG, and AAE-1. Two others, SJC 2 and ADC, are scheduled to be put into use in 2022 and 2023. Meanwhile, other countries in the region have more routes such as Singapore (30), Malaysia (22), and Thailand (10). Compared to them, international infrastructure serving internet connection in Vietnam remains modest, a report stated. Experts believe that it is crucial to develop infrastructure for international Internet connection on par with regional countries.
Deputy Director of the Telecommunications Authority, Nguyen Phong Nha, stated that to improve broadband Internet quality, the government should focus on upgrading bandwidth and modem devices’ capacity, widening domestic and international bandwidth, and amending standards. Apart from investing in Internet infrastructure, telecoms services suppliers should also prepare backup plans. Developing digital infrastructure, including the Internet, telecoms, and cloud computing infrastructure, is set to be among the country’s top priorities between now and 2025. This will also create a big opportunity for service providers, infrastructure developers, and operators to compete equally with transnational enterprises in Vietnam.
The country had earlier set an ambitious target for the digital economy to account for 20% of the GDP by 2025. However, the Deputy Director of the Department of Enterprise Management, Nguyen Trong Duong, believes that with a breakthrough scenario, the Vietnamese digital economy could account for 26.2% of the GDP in the next three years. He stated that this will be possible if digital transformation and digital economy development are strongly deployed, accompanied by measures to ensure a market balance between domestic digital enterprises and foreign counterparts. The government would also formulate policies to support Vietnamese technology start-ups. 16% of the 26.2% would be from information communication technologies (ICTs), telecommunications, and the Internet economy.
At the beginning of the year, OpenGov Asia reported that the government aims to have ten technology firms with annual revenue of over US$1 billion by 2025. It plans to have 100,000 digital technology firms by 2025 and have at least ten firms compete in global markets. It also wants to have 10 localities with revenues of over US$1 billion from ICT and 10-12 IT zones. Last year, the total revenue of Vietnam’s ICT segment was estimated at an all-time high of VND3,462 trillion (US$151 billion), growing 9% year on year. The ICT segment alone contributes over US$136 billion to the sum, increasing by some US$11.5 billion from last year, according to MIC data.