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Indonesia and Singapore to build SEA’s Digital Hub

Image credit: e27.co

As the digital economy grows and matures with the on-going COVID-19 pandemic, the “smart cities” movement is gaining momentum. For most, it represents the promise of high-tech cities, cars equipped with advanced tech rolling the streets, AI-powered drones delivering food, and connected devices everywhere helping citizens experience digital haven.

With this end-goal in mind, Indonesia and Singapore team up to build Southeast Asia’s digital hub of the future. The two countries called this project, “Nongsa D-Town”. This will serve as a digital bridge between Indonesia and Singapore connecting Batam’s high-tech future with its industrial past.

Located just 40 minutes by ferry from Singapore’s Harbourfront, the digital hub provides an opportunity for rising start-ups from both countries to collaborate within close physical proximity. The settlement is built upon the three philosophical pillars of ecological, digital, and physical sustainability. Rather than the hyper-urban culture typical of many downtown tech hubs, life at D-town is designed to accommodate sustainable mobile work.

Designed by a Singaporean firm and developed by two of Indonesia’s largest conglomerates, the interconnected layout of D-Town includes a residential village, tech campuses, a town plaza, and a commercial centre and is set to house 8000 tech talents when completed. There are currently about 1000 tech talents at the existing NDP working for tech companies and start-ups from the two countries.

Singapore and Indonesia are home to Southeast Asia’s most vibrant tech ecosystems. Eleven out of the thirteen tech unicorns operating in ASEAN are headquartered in either country, seven out of those eleven are homegrown start-ups.

The two countries have produced companies that dominate the regional market by first-mover advantages over their neighbours through superior technology, as is the case with Singapore, and massive population size, as is the case with Indonesia, their respective start-up scenes share and compete for talent, resources, and market share.
Overlapping time zones between Indonesia and Singapore facilitate ease of work across borders. Due to the accelerated transition to digital within the last year, cross-border collaboration between remote teams has become a common occurrence. Despite Singapore’s technological advancement compared to its neighbours, it faces a shortage of tech talent. Nongsa D-Town will allow talent from Indonesia and Singapore to collaborate directly within the same area, providing a solution to the shortage while further tightening economic ties between the two nations.

At 270 million people, Indonesia is the largest market in ASEAN. Indonesians are notoriously early adopters of new technologies when given the chance, with 32% of the population keen to use new tech products as soon as they enter the market, according to a survey. The sheer volume of Indonesian consumers eager to try new technologies makes the country an ideal steppingstone for Singaporean start-ups that intend to scale regionally, often through Batam as a port of call.

At the same time, within the perimeter of the D-Town Masterplan that will be launched, there is Nongsa Digital Park (NDP), an initiative supported by both Indonesian and Singapore Governments which is frequently mentioned in high-level bilateral meetings between President Jokowi and Prime Minister Lee. D-Town leverages on the initial success of NDP that saw several international companies have already taken advantage of the access to talent and the economic incentives currently offered to set up in the digital downtown.

Indonesia’s National Special Economic Zone Council, chaired by Coordinating Minister for Economic Affairs Airlangga Hartarto, announced that NDP has the potential to create employment and boost economic growth, hence it was recommended to President Jokowi to be confirmed as a new Special Economic Zone (SEZ).

As reported by OpenGov Asia, these digital ventures were recently mentioned as part of Singapore’s investment budget over the next three years. Deputy PM Heng Swee Keat announced that Singapore will be allocating around $24 billion over the next three years to enhance its digital connectivity and global presence, a plan which includes cross-country investments like NDP and its next phase of development, Nongsa D-Town.

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