Of the eleven ASEAN member countries, Indonesia is expected to have the highest economic impact of harnessing AI, accounting for $366 billion, followed by Thailand ($117 billion), Singapore ($110 billion), Malaysia ($115 billion), Vietnam ($109 billion) and the Philippines ($92 billion).
ndonesia has a great opportunity to become a navigator for developing artificial intelligence (AI) technology in Southeast Asia. This opportunity comes as Indonesia performs excellently in applying AI in the public and business sectors, with the enormous market potential for domestic AI development investment and the significant results of AI-related research.
AI-based technology is being massively developed in the public sector with the aim of administrative effectiveness and efficiency in developing smart governance, which can be seen in the implementation of the Smart City program.
In the business sector, Indonesia remains the region's largest potential market for investment in AI development. According to an OECD report (2022), Indonesia leads the amount of venture capital (VC) funding gained for AI development among the other five leading AI development countries in the region, namely Singapore, Malaysia, Thailand, Vietnam and the Philippines. As of 2022, Indonesia had successfully brought in some US$1,865 million in investment, highly exceeding Singapore ($529 million), Malaysia ($76 million), the Philippines ($63 million), Thailand ($46 million) and Vietnam ($12 million).
In the field of research, Indonesia is also at the forefront. According to a 2022 OECD report, 11,891 scientific publications related to AI had been published by academics and researchers in Indonesia as of that year. This achievement ranks Indonesia as the most prolific in terms of research publications in the field of AI, surpassing the achievements of other ASEAN member states.
The most considerable potential for using AI is to advance economic growth. Regionally, Southeast Asia is estimated to stand to gain up to $950 billion, or 13 percent of the gross regional product by 2030.
Of the eleven ASEAN member countries, Indonesia is expected to have the highest economic impact of harnessing AI, accounting for $366 billion, followed by Thailand ($117 billion), Singapore ($110 billion), Malaysia ($115 billion), Vietnam ($109 billion) and the Philippines ($92 billion).
However, aside from being beneficial, there are several challenges for Indonesia and other Southeast Asian countries in the future of AI governance. According to a study by the Asia Society Policy Institute (2022), at least three crucial issues need attention, namely inclusivity, cyber resilience and labor market disruption.
Inclusion is related to the need to prioritize a community-centric approach in formulating various future policies related to the development and use of AI-based technology. With AI relying heavily on public data from virtual applications, services and utilities, cyber resilience must be a prerequisite before further development. Securing a high standard of personal data protection and anticipating the rise of digital surveillance must be the country's priorities to foster public confidence in AI-based technology.
The exponential and widespread adoption of AI has also disrupted the labor market. The disruptions are often exacerbated by the lack of highly skilled workers capable of working in high-tech industries. In addition, according to Rosser (2018), political budget commitment from the state is imperative to facilitate education and manage the workforce to deal with the human resource deficit.
Reflecting on the success of its past Group of 20 presidency, Indonesia, which is holding the 2023 ASEAN chairmanship, must deploy its clout to navigate the future of AI governance in the region as part of strengthening the digital environment in the region, thereby optimizing benefits and preventing potential risks.
This role can be kick-started by embracing other countries that are already advanced in AI development in Southeast Asia, such as Singapore, Malaysia, Thailand, Vietnam and the Philippines, to ensure that the use of AI is carried out fairly for people in the region and potential risks can be appropriately managed.
Although the ASEAN digital ministers' meeting earlier this year acknowledged the importance of setting guidelines for governance and ethics in using AI. The substance of the approaches to prevent potential risks in harnessing this technology has still not be seen. For this reason, some further concrete and collective initiatives are urgently needed.
First and foremost, Southeast Asian states must agree on a standard definition of AI and its use risks. In this case, Indonesia can propose adopting a risk-based approach by the European Union in defining risks in the use of AI.
Second, Indonesia should encourage the establishment of a joint regulatory framework at the regional level to regulate AI governance, which also covers its development and utilization. This legal basis is paramount to regulating the use of AI, which is considered to have a potential negative impact on users. These harmful practices range from discrimination and digital surveillance to personal data leaks.
Third, Indonesia should initiate a comprehensive regional partnership for AI development. This initiative is critical to strengthen the spirit of togetherness among ASEAN member states in harnessing and developing AI collectively. Some collaborations may include the development of a highly skilled workforce, developing digital infrastructure, strengthening research and increasing investment.
Recognizing the vast potential benefits of using AI in the future, Indonesia can use the ASEAN chairmanship to ensure that the future of AI governance in the region not only has a positive impact on the country’s economic growth but also spurs equitable AI development between countries and secures the digital rights of its users across Southeast Asia.
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The author is a postgraduate student at KU Leuven, Belgium.
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