A rising Digital Asia: Opportunities and concerns

As Digital Asia increases its influence in the global arena, innovation and openness will play a more dominant role for vibrant economies. At the same time, there are concerns over the potential for mass unemployment and a widening gap among countries arising from Digital technologies, adding more uncertainties to the world economy.

With the theme of "Innovation and openness, new vitality of Asian economies," the annual Dialogue with Thinkers TV Debate at the Boao Forum for Asia this year was joined by five distinguished panelists who shared their insights and forecast on a rising Digital Asia during the .

On the concerns and fears brought by the rise of the Digital economy, Dame Jenny Shipley, former prime minister of New Zealand, pointed out that people can be anxious, but also hopeful at the same time because it allows for inclusive finance that will connect people to the real economy in a way that the traditional economy has not.

"The next step of microfinance and enabling this through data I think is the key to inclusion and the reduction of inequity," said Dame Shipley. "I think that while unemployment is a complex side effect, I think this might offset it to some extent."

Carlos M. Gutierrez, former U.S. Secretary of Commerce, agreed with the prime minister in that there are important benefits brought by the Digital economy but added that there are also negatives and downsides that can't be ignored. He explained that these technologies are beginning to come to life but haven't hit at scale yet, and when they do, there will be a lot of displaced workers.

Vincent Lo Hong-sui, chairman of Shui On Group and Hoe Ee Khor as well as chief economist of ASEAN+3 Macroeconomic Research Office, approached the issue of unemployment during the Digital age from regional perspectives.

Lo indicated that Hong Kong has over full employment currently and it needs to upgrade the whole economy that is no longer simple finance or real estate but to play more of an integrator role.

Khor pointed out that East Asia is very enthusiastic about new technologies, but technologies are disruptive as they change the way of conducting business. The countries in the region that focus on the manufacturing sector are very concerned about reduced employment caused by new technologies, so they come up with plans on how to move forward and take advantage of the new Industrial Revolution.

"My sense is that the new services that are created by technologies are going to be much greater than the disruption or the reduction in employment," concluded Khor.

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Diwakar Gupta, vice-president for Private Sector and Co-financing Operations at the Asian Development Bank, compared the job market to a black box because we don't know the pace of technological change and what we should be retraining people for.

Gupta is optimistic that it won't be the case that more people are made redundant. However, he thinks one thing that will happen is the hollowing out of the middle as automation will take up all the normally easy-to-do jobs in the middle. In that case, company profits will flow into shareholders rather than be paid out as wages.

"So I think one very big thing that governments will have to do is to find redistributed mechanisms by which these profits are then channelized for the public good to those people who have been affected by the hollowed out middle," Gupta suggested.

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