How ASEAN’s Digital Economy Remains Robust During The Pandemic

How ASEAN’s Digital Economy Remains Robust During The Pandemic

Introduction

During uncertain times, plenty of esteemed value investors would advise other investors to purchase stocks in the markets.

Compared to what investors faced in the 1900s, they have not faced an event as serious as what we are facing now a pandemic plaguing the entire world that has resulted in a record-high number of deaths and global economic crisis.

However, if you trust that mankind will be able to create an antidote for COVID19 within the next year, then you would also trust that the worldwide economy can make a recovery fast. Unfortunately, the businesses that are able to brave this crisis, especially the ones in the tech market, will be divergent from the current businesses we have prior to COVID19.

Surprisingly, the International Monetary Fund has stated that only the undeveloped Asian countries can look forward to the growth of more than zero in their GDP for the year 2020. The majority of the rest of the economies would not be so fortunate to experience that. From a tech investor’s perspective, this means that there is something intriguing about the society and consumer preferences in the whole ASEAN market.

Amidst the mess and apprehension in the economy, here are reasons, why I believe now, is the opportune time to be performing tech investments in ASEAN.

Millennials Will Aid in the Recovery of the Economy

In the past, ASEAN was known to be made of countries making slow improvements. Now, ASEAN is one of the top places for investors and firms all over the world and in a good sense. With over 660 million individuals, which makes up an estimated 8.5% of the global population, they contribute US$6.5 trillion to their economy due to their fast population growth, a high percentage of tech-savvy individuals, and a developing digital economy.

The ASEAN community is young, educated, and sophisticated, with approximately 50% of the area having undergone urbanization with its median age being a low 30.2 years old. For instance, there are tons of fresh graduate jobs singapore even during this pandemic so this region is certainly set to grow; with plenty of job opportunities.

On the other hand, Western European countries such as Spain, Italy, France, and the UK, are among the top 25 economies with the biggest proportion of populace over the age of 65 and they are ranked among the top 10 popular destinations in 2019.

With the pandemic endangering the lives of the majority of their population and murdering tourism, which contributes a huge proportion towards their growth, it is certainly more difficult for these European countries to recover soon, compared to the ASEAN countries that have greater household demands and younger labor forces as a backup.

Past and Present Teachings

The pandemic and inevitable limitations on activities implemented by almost all of the nations have caused past teachings to be brought under the spotlight, as cash liquidity became every start up’s only vital measurement in a blink of an eye. 

The leaders and firms that are quick to adapt have already begun to accept the situation now. As individuals’ usage of the internet rose sharply due to them being restricted to their homes, startups are beginning to readjust their goals and vision. In some startups, they might even undergo drastic and abrupt changes.

In Indonesia, the limitations to activities have impacted at least 34 million individuals in the Greater Jakarta region, and it is highly probable that the other provinces and areas will follow suit and implement their own lockdowns.

These limitations highlight the necessity of public resources such as healthcare, education, logistics, and agriculture. These are areas that shrewd venture capitals and angel investors would excel to aid in the postCOVID19 generation, particularly as the suburban areas of Indonesia begin their lockdowns in the near future.

How ASEAN’s Digital Economy Remains Robust During The Pandemic

There is still a huge pool of entrepreneurs who are still trying to connect the farmers and customers and these are essential connections for small firms and farmers not in the city areas. Firms like TaniHub, a businesstobusiness (B2B) agriculture marketplace, has become critical to the country’s digital economy overnight.

As for the healthcare and sanitation businesses in the startup landscape, they now offer essential information avenues and aid individuals who are too scared to go to hospitals or clinics or take their prescriptions from pharmacies.

Digital companies such as Halodoc and Alodokter have achieved consumer confidence among all the fake news and Whatsapp scams. These businesses play the role of medical facts curator for anything related to COVID19 by creating reliable avenues for frequently asked questions and authorities’ announcements. 

Putting Public Necessities in the First Place for Their Nation

Investing in firms providing public necessities should not be for short term gains because social distancing and online businesses are likely to be the standard for at least a few years after COVID19 recedes. At that point in time, it would be extremely difficult to return to the state prior to the pandemic; B2B and businesstoconsumer preferences would have changed.

Cogent advice from famous investors may be convincing, particularly if you are the type of investor whose eyes are fixed solely on the gains.

However, our general consensus is that an investor should always be willing to invest in public necessities regardless of a pandemic or not. The onset of the virus should not have affected your investment decision in any way.

Readjusting to Keep in the Game in the Long Run

Should an antidote for COVID19 appear in the short term, ASEAN’s digital economy should have expanded beyond US$300 billion in as short a time as half a decade. This is a call for small and medium-sized businesses to embrace tech and the internet to connect with an increasing demographic.

Conclusion

With the younger and tech-savvy population contributing to greater demands, ASEAN is the best place for GDP progress. However, as COVID19 carries on its destruction over the world in 2020, a few events must be triggered to maintain our digital economy.

Venture investors who are confident of braving the crisis have to increase their overall risk appetite and continue spending and stimulating demand in the market. Whenever the need calls for it, they should be ready to relocate their funds towards firms that will brave this crisis and excel under the adjusted market equilibrium.

As for entrepreneurs, their businesses have to focus on maintaining cash liquidity and guarantee that their business plans are fiscally feasible. On top of that, every leader should determine if the company requires drastic changes, which may alter the basic foundation of the firm.