Harnessing Digital Technology for Sustainable Recovery - Masatsugu Asakawa
Speech | 21 October 2020
Speech by Masatsugu Asakawa, President, Asian Development Bank, at the Southeast Asia Development Symposium, 21 October 2020
Your Excellency Minister Sri Mulyani, Minister Nadiem Anwar Makarim, Vice Ministers and senior officials, representatives from the private sector, Ladies and Gentlemen:
Good morning, and thank you for joining us for the Asian Development Bank’s Southeast Asia Development Symposium. This is the first of what will be an annual event to provide government officials in Southeast Asia, and other stakeholders, with a wide range of cutting-edge perspectives on critical development issues. The symposium complements ADB’s ongoing work to support our developing member countries in making the transition to prosperous, knowledge-based, and sustainable economies.
We convene at a time when the region is still grappling with the coronavirus disease (COVID-19) pandemic. The impacts on human health and wellbeing, livelihoods, and economic activity have been truly painful. At the same time, the pandemic has accelerated digitalization—which is transforming the way we communicate, work, learn, and live.
Accordingly, this year’ symposium is focusing on how Southeast Asia can utilize digital technology to mitigate the impacts of the pandemic, and lay the groundwork for long-term economic recovery. Today’s event features a dynamic lineup of speakers and panelists from governments, the private sector, academia, and development organizations, who will share their insights on this important topic.
To provide context for this symposium, I would like to begin by describing how ADB has responded to the COVID-19 crisis by supporting the active use of digital technology. Then, I will present five key policy areas that I believe countries in Southeast Asia should strongly consider as they pave the way for a speedy recovery and prepare for a sustainable future built upon increased and innovative uses of technology.
I. The role of digital technology in ADB’s COVID-19 response
When the COVID-19 crisis hit, ADB responded quickly with a $20 billion assistance package to support our developing members as they address the crisis and prepare for a new normal.
Our package consists of three pillars, all of which incorporate digital technology in order to enhance effectiveness.
Under the first pillar, ADB quickly provided grant support and technical assistance to our developing member countries to meet their immediate needs for purchasing critical medical equipment and supplies, and to support the distribution of food and daily necessities to the most vulnerable populations.
For example, when Metro Manila was locked down under strict quarantine restrictions in April, ADB, in partnership with the government and private sector, provided grant support to deliver food to 162,000 households. Our use of mobile technology facilitated prompt procurement and payment for supplies, which increased the efficiency of our operations.
Under the second pillar of ADB’s COVID-19 assistance, we are providing fast-disbursing countercyclical funding to help our member governments implement emergency programs and prepare for recovery. In Southeast Asia, ADB provided $5 billion through our new financing modality called the “COVID-19 Pandemic Response Option,” to support governments’ efforts to strengthen healthcare systems, increase social assistance to the poor and vulnerable, and provide economic stimulus to businesses, including small and medium enterprises (SMEs).
As we provide this budget support, we have stressed the importance of digital solutions for mitigating the spread of the pandemic and ensuring the speedy and transparent disbursement of social assistance.
For example, in Makassar, Indonesia, a project supported by ADB and the ASEAN Australia Smart Cities Trust Fund is enabling officials to utilize digital technology to map the spread of COVID-19, and to overlay this information with geo-located data on poverty, population density, access to basic services, and vicinity to transportation hubs. These tools are ensuring a more targeted distribution of protective equipment and other disease mitigation measures.
ADB’s third pillar of assistance is providing substantial support to the private sector, including about $1.7 billion to rejuvenate trade and supply chains; support enhanced microfinance and guarantees for liquidity-starved businesses; and maintain employment. ADB’s Trade Finance Program and Supply Chain Finance Programs have developed a new interactive mapping tool that allows governments, banks, investors, and healthcare professionals to pinpoint which products are vital to healthcare and other frontline workers.
In these and many other ADB operations, we are seeing the tremendous role that digital technology can play in securing new solutions to the challenges facing communities and businesses during the pandemic and beyond.
II. Preparing for a technology-driven and sustainable future
I will now discuss five key policy areas that developing economies in Southeast Asia should consider. These measures can help countries return to a path leading to the achievement of the Sustainable Development Goals. Once again, I firmly believe that digital technology will play an indispensable role.
First, it is important that countries address regional disparities and ensure more equitable access to technology. For this, we must close the digital divide and expand existing investments in digital infrastructure, by building more and higher quality mobile broadband infrastructure and ensuring affordable internet access and coverage.
These steps can also enhance access to basic social services such as health and education, and access to financial services. These investments will better equip countries to address the worsening income inequality and disparities in opportunities brought about by the pandemic.
At the same time, governments, businesses and individuals need to enhance cyber security, to ensure that investments in digital infrastructure have their desired effect.
A second policy issue is to facilitate green and resilient recovery. This will require promoting investments that drive economic activity toward low-carbon and resilient practices. We can accelerate these efforts by investing in digital technology.
For example, Intelligent Transportation Systems can support real-time traffic control and transport routing systems to manage congestion and reduce air pollution. Smart-Grid systems are also helping to secure a more efficient energy supply.
As a third priority, countries should seize the opportunities that renewed globalization can offer in a post-pandemic new normal by strengthening regional cooperation and integration. Stronger cross-border digital connectivity, e-customs systems, and electronic cargo tracking systems can all make important contributions.
Regional cooperation can also help build resilience against health security risks. ADB supports building a stronger regional disease surveillance system to contain the threat of future pandemics.
Fourth, countries need to strengthen their institutional capacity for mobilizing domestic resources, so that they are in a better position to finance public services while ensuring debt sustainability.
The introduction of Revenue Administration Management Information Systems in many of ADB’s developing member economies is leading to efficiency improvements in tax filing and processing, and an increase in tax yields. The use of satellite imagery and Geographic Information Systems is helping local governments monitor economic activity so that they can better assess property taxes.
Last, to support all of the measures I described, countries should vigorously incubate, develop, and congregate SMEs through strengthened support for entrepreneurship and technology. To this end, it is imperative for countries to help aggregate a financial, academic, and business ecosystem that creates a cutting-edge industrial base where SMEs can congregate, just like Silicon Valley, Shenzhen, and Kyoto. Doing so will help set the stage for technology-based growth of the future, and it will position Southeast Asia for a new, digital age of prosperity.
To support these efforts, ADB established ADB Ventures in January this year. I believe ADB Ventures will help technology startups in Southeast Asia scale up and deploy their technology solutions in the key policy areas that I have highlighted today.
To conclude, let me express my optimism that digital technology can serve as a lynchpin in Southeast Asia’s recovery from the COVID-19 pandemic. Let us build on our existing efforts to mainstream digital technology use across sectors.
I hope today’s discussions will offer new and valuable perspectives on addressing the immense challenges we face as we continue our work together toward a prosperous, inclusive, resilient, and sustainable future for Southeast Asia.
Thank you again for joining us, and I wish all of you good health.