Positioning Southeast Asia
Irrespective of whether it is China or the United States that emerges triumphant in the race for tech supremacy, whether the battle results in a grinding stalemate, or whether there will be other champions in digital regulation, three things remain true for Southeast Asia.
One, neither Tech Americana nor Tech Sinica is a given. Covid-19 and its still unfolding aftermath underscore how risky it is to assume linear trajectories of history or power. In any event, for Southeast Asia, neither the Chinese nor US model is necessarily desirable. One is not morally or ideologically superior to the other. Despite charges by critics of Beijing’s spread of “techno-authoritarianism” through its use and export of surveillance software and hardware, the United States has had its own disturbing history of surveillance on millions worldwide – even American citizens and the leaders of allied nations – as disclosed by the 2013 leaks by whistleblower Edward Snowden and Freedom of Information Act revelations.
Two, Southeast Asian countries can both capitalize on, and be incapacitated by, the Sino-American tech rivalry. At the manufacturing, assembly, and logistics level, the semiconductor chip wars, prompting shifts in supply chains, and the passage of US legislation such as the Creating Helpful Incentives to Produce Semiconductors and Science Act of 2022 (CHIPS Act) present growing opportunities for a majority of Southeast Asian countries.
Malaysia, already a key player in the semiconductor assembly, testing and packaging ecosystem, is looking to expand its back-end capacity to support the anticipated increase in front-end fabrication plants in the United States. The CHIPS Act is also expected to boost US investment in the Philippines, particularly in advanced technology programs, research and development, integrated circuit design, and software development.
Vietnam has drawn additional, large investments from the likes of Apple/Foxconn, Intel and Samsung with Hanoi working hard to position both its location and labor as natural alternatives to China. In 2021, at the height of the pandemic, the Vietnamese government set up a special working group to facilitate and fast-track “high-tech and innovative projects.” Vietnam’s involvement in the semiconductor industry is spread across the value chain spectrum, from chip-design software to manufacturing, assembly, and testing of core processors.
Although not an established player in the semiconductor industry, Indonesia is also hoping to draw some of China’s chip-supply market. Jakarta is courting US investment, pitching Indonesia’s experience in steel production and the availability of raw materials.
Yet, the lure of investment aside, Southeast Asia may also find itself having to unravel or loosen increasingly constricting knots in the regional fabric of connectivity and critical infrastructure involving a range of partners from around Asia (including China), the Pacific, the European Union and the United States. A patchwork of providers diversifies the risk of dependence for third party countries in Southeast Asia. US-China decoupling, however, could complicate platform and infrastructural harmonization or interoperability across the region. The controversy over 5G is illustrative. In particular, the United Kingdom’s 2020 reversal of its earlier decision allowing China’s Huawei Technologies to supply 35 percent of the country’s 5G network following domestic pressure and US sanctions is a cautionary tale for Southeast Asia.
Three, Southeast Asia must set its own course and more proactively contribute to the more consequential arena of contestation: standards-setting. This is where the technical, legal and policy rules of the road governing current and next generation technologies are being (re)set and (re)framed by governments and industry alike to further various agendas. Sometimes, these interests serendipitously align to the common good.
Technical standards-setting in bodies such as the International Telecommunication Union (ITU) and the Third Generation Partner Project is fast becoming another front of competition as China’s drive for standardization in its domestic market makes its way to international fora. The incorporation of these standards into DSR projects around the world as well as China’s participation in United Nations frameworks such as the UN Group of Governmental Experts on Developments in the Field of Information and Telecommunications in the Context of International Security along with the UN Open-Ended Working Group are raising the stakes for governance in the digital tech space. The recent election of Doreen Bogdan-Martin, the American candidate to head the ITU, was not without its geopolitical undertones as she replaced a two-term predecessor from China, Zhao Houlin, and defeated a Russian opponent, Rashid Ismailov.
It is crucial for Southeast Asian countries to contribute actively to unfolding conversations on tech at the international level. All nations large and small but particularly those forming the global majority have a stake in the global digital future. Beyond being mere users or consumers of tech, they are in fact entitled and obligated to help shape the rules of which they are, and will be, a part.