ASEAN reforms urged to deal with automation threat to labor

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(L-R) Malaysia’s Prime Minister Najib Razak, Myanmar’s State Counselor and Foreign Minister Aung San Suu Kyi, Thailand’s Prime Minister Prayuth Chan-ocha, Vietnam’s Prime Minister Nguyen Xuan Phuc, South Korea President Moon Jae-in, Philippines’ President Rodrigo Duterte, Singapore’s Prime Minister Lee Hsien Loong, Brunei’s Sultan Hassanal Bolkiah, Cambodia’s Prime Minister Hun Sen, Indonesia’s President Joko Widodo and Laos’ Prime Minister Thongloun Sisoulith, join hands during a family photo before the 19th ASEAN Republic of Korea Summit on the sideline of the 31st Association of Southeast Asian Nations (ASEAN) Summit in Manila on Nov. 13. -- AFP

THE World Economic Forum (WEF) said on Monday that the Association of Southeast Asian Nations (ASEAN) must introduce reforms ahead of greater automation and digitalization associated with the so-called fourth industrial revolution, which poses a threat to jobs and social stability.

In a report with seven specific recommendations for the region, WEF’s ASEAN Regional Business Council (RBC) Chairman Nazir Razak said that the member states should deal with the issue as a region, not just individually.

Mr. Nazir, citing International Labor Organization data, said that 56% of jobs in the region are at high risk of automation despite an expansionary outlook for the work force in the region, which is expected to increase by 11,000 new workers daily over the next 15 years.

“The first [thing to do] is to turn the secretariat into a platform organization. The secretariat would govern the platform for regional integration, but third parties would do the job of developing policies and regulation,” he added.

Mr. Nazir, chairman of Malaysia’s CIMB Group, said such a reorganized secretariat would harness more resources from a wider pool and take advise from third parties with deep expertise in areas needing reform.

Another recommendation is to increase the funding for the ASEAN secretary general to $220 million from the current $2 million annually.

“Our report recommends a funding model based on the size of the GDP (Gross Domestic Product) of the economies with the big economies paying more than the smaller economies like what we have at the United Nations,” Mr. Nazir said.

The report, published in partnership with the Asian Development Bank (ADB), attempts to evaluate how the fourth industrial revolution impacts the ASEAN region. WEF’s ASEAN RBC, launched last year, has 25 representatives from ASEAN businesses and 30 representatives from global companies, who advise the WEF on issue related to the region.

ADB Vice-President for operations in East Asia, Southeast Asia and the Pacific Stephen P. Groff said that while the fourth industrial revolution provides opportunities to improve quality of life, it can also bring challenges such as the risk of low-cost labor being phased out in favor of automation.

These disruptions, Mr. Nazir said, may breed discontent and instability.

“With prudent fiscal management and appropriate policy, opportunities for lifelong learning and incentives for skills training can be created and we can indeed ensure the benefits can be realized by all segments in society,” Mr. Groff said.

“[M]y request to ASEAN leaders is that we set up a working group to take this forward. Its goal will be to reflect deeply on the impact of the fourth industrial revolution on our region and more importantly to examine the modus operandi of our ASEAN institutions to cope,” he added.

“If we do not act, ASEAN will suffer in the fourth industrial revolution but if we take proper steps then we will not only survive, but I believe we can thrive.” — Anna Gabriela A. Mogato

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