How small businesses in Southeast Asia can go global

The past two weeks have seen a flurry of engagements in the Asia-Pacific region, with the ASEAN Summit in Phnom Penh, the G20 Summit in Bali and the APEC Economic Leaders’ Week in Bangkok. Amid economic setbacks and the current state of pandemic recovery, all three Summits have renewed focus on how technology and trade can drive economic opportunity and sustainable, inclusive growth. What can governments and businesses do to make this possible?

Small and medium-sized businesses (SMEs) are a great example of how technology can facilitate inclusive commerce and also help businesses become more agile.

With the Internet, SMEs are able to reach new customers in global markets in a way they could not before. Many people want to take advantage of the opportunity. In a recent report on digital exports published by the International Chamber of Commerce (ICC) and Google, the majority of 1,500+ SMEs surveyed in Southeast Asia expressed a strong interest in exporting both regionally and internationally. 70% of these companies also cited digital tools as a way to discover and enter new markets.

In terms of business resilience, recent research also shows that on average 97% of digitized SMEs are exporting, and 1 in 3 SMEs in Southeast Asia credited digitization with helping them weather economic headwinds at the peak of the pandemic. :

More skill training, better connection.

This is both a challenge and an opportunity, given that the participation of SMEs in exports and global markets remains relatively low, ranging from 10% to 30% of national exports and 18% of the region’s total exports. : The ICC-Google report cites access to quality digital infrastructure as a significant barrier for SMEs, citing slow internet connections or unreliable service. Another key challenge is the increasingly fragmented digital policy landscape, which makes compliance and global scale both costly and difficult for SMEs. Since January 2020, APEC economies have registered more than 1,300 new digital regulations and laws.

Moreover, the lack of adequate digital skills holds back potential. 75% of SMEs expressed an interest in developing the skills needed to make the most of digital opportunities.

Google is working to close these gaps. In 2018, we committed to training 3 million SME workers in Southeast Asia to develop their digital skills, and we recently achieved this goal in collaboration with our government partners, local associations and NGOs. We are also investing in technical infrastructure such as submarine cables and cloud regions in several countries in Southeast Asia, which will help better connect people in the region.

Without a doubt, SMEs are the heart of Southeast Asia’s economy. They account for nearly 99% of all businesses and contribute to 85% of all jobs in the region, not to mention almost half of the region’s GDP. Their digitization promises great benefits for the region’s economy and equitable growth. In fact, the region’s digital economy is already expected to reach $200 billion in gross merchandise value (GMV) this year.

That’s why, in partnership with the ICC and the International Trade Center, we will develop a curriculum to train 1,000 Southeast Asian SMEs with relevant digital export skills. The program will teach SMEs how to start or expand export efforts, use tools such as Market Finder (which helps businesses create export plans), identify international opportunities and promote their products.

Through these efforts and our continued collaboration with governments and partners, we hope that SMEs in Southeast Asia will be able to unlock new international business opportunities and develop to their full potential.

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