DEFA Set To Lower Expansion Costs, Boost ASEAN Creative Collaboration -- Experts
By Nabilah Saleh and Linda Khoo
KUALA LUMPUR, Nov 4 (Bernama) -- The ASEAN Digital Economy Framework Agreement (DEFA) could lower the cost of regional expansion and ease cross-border partnerships for Southeast Asia’s digital publishers, content creators and small businesses, according to experts.
Good News from Southeast Asia (Seasia) founder Akhyari Hananto said the agreement could reduce barriers involving cross-border payments, data transfers, electronic signatures and digital identification, making regional collaboration easier.
However, he said differences in national regulations, taxation, content rules and platform registration requirements would remain, preventing ASEAN from immediately functioning as a single digital market.
“So I would put it this way: the walls get lower. They do not disappear. For small players who cannot hire lawyers in ten countries, though, lower walls already help a lot,” he told Bernama.
DEFA, ASEAN’s flagship region-wide digital economy pact, is slated to be signed at the ASEAN Summit in Manila later this month.
Akhyari said DEFA could particularly benefit digital publishers and content creators whose interests are often sidelined by e-commerce and fintech (financial technology), emphasising that the agreement’s greatest promise lies in driving regional creative collaboration.
He said greater recognition of electronic contracts and signatures could facilitate joint productions between Malaysian and regional newsrooms, hiring freelance writers from Vietnam, and collaborating with Thai content creators.
Clearer cross-border data regulations could also benefit publishers that rely on analytics, cloud services, and advertising platforms operating outside their home countries.
However, Akhyari said many smaller digital businesses remained unfamiliar with trade agreements, citing his experience conducting training and mentoring programmes with organisations and universities.
“So if ASEAN really means ‘inclusive,’ there has to be a second step. Simple guidance, in local languages, through communities, campuses, associations, people who can explain it in plain terms,” he said.
Looking ahead, Akhyari said DEFA’s success over the next three years to five years should be measured by lower cross-border operating costs, higher regional earnings for smaller enterprises and a surge in partnerships among ASEAN businesses.
“Basically, if in three years a small publisher or creator can say ‘yeah, regional work is easier now’ and can explain why, then it is working,” he said.
Echoing these sentiments, Malaysia University of Science and Technology (MUST) economist Professor Emeritus Dr Barjoyai Bardai said DEFA could accelerate regional digital integration by cutting compliance red tape and lowering market entry costs, though disparities in domestic regulations and digital maturity remain significant hurdles.
He said DEFA could do for digital commerce what the ASEAN Free Trade Area (AFTA) did for the movement of goods by harmonising the diverse regulatory, tax, and data governance hurdles that currently inflate operating costs across the region.
“For instance, a Malaysian software company expanding into five ASEAN markets may need separate legal reviews, compliance systems and regulatory filings in each country.
“This duplicates costs that could otherwise be invested in innovation and growth,” he told Bernama.
He said regulatory fragmentation could raise market-entry costs by 10 per cent to 20 per cent, citing studies on the burden of differing rules across markets.
Barjoyai said a more harmonised framework for digital trade, data flows and payments could reduce these barriers and provide greater certainty for businesses, boosting digital trade and regional competitiveness.
“The result would be a more integrated ASEAN digital marketplace capable of competing with China, the European Union and the United States in selected digital sectors,” he said.
However, Barjoyai cautioned that implementation faces major hurdles, citing disparities in digital infrastructure, skills, and business readiness across ASEAN, as well as lingering sovereignty concerns over cross-border data flows and digital governance.
“The success of DEFA will depend not merely on signing the agreement but on creating practical implementation mechanisms and dispute resolution frameworks,” he said.
-- BERNAMA