Nazir: 4IR can be a powerful tool if we use it right

MANILA: CIMB group chairman Datuk Seri Nazir Razak has issued a clarion call to regional leaders and captains of industry to change the way Asean does business.

As chair of the East Asia Business Council (EABC), Nazir warned that Asean risked being left behind when the Fourth Industrial Revolution (4IR) hit.

“Technologies emerging around us are transforming the world – from the nature of jobs and work to the way societies function.

“We look forward to a new age of industrial revolution but it will bring new challenges and it is going to affect everything.

“There will be a huge disruption to jobs.

“Robots and artificial intelligence are already replacing workers in factories and increasingly, they will challenge services jobs too,” Nazir told a gathering of some of the most powerful people in Asean here yesterday.

Present were heads of state from Asean members, including Prime Minster Datuk Seri Najib Tun Razak and leaders of China, Japan and South Korea.

This grouping – the Asean Plus Three – also saw the attendance of three influential business leaders from each country with Malaysia being represented by Nazir, AirAsia Group CEO Tan Sri Tony Fernandes and Bank Muamalat chairman Tan Sri Munir Majid.

Quoting the International Labour Organisation, Nazir said 56% of jobs in Asean were at risk of automation and yet, it would see its workforce grow by 11,000 workers every day for the next 15 years.

“Where will we find 60 million new jobs when the ones we have are already under such pressure?” he asked.

When these jobs disappear, Nazir said this would drive up inequality and breed discontent and instability, adding however that should Asean position itself properly, the 4IR would be a powerful tool or force for prosperity.

Nazir said while some countries had already started to act – Thailand with its Thailand 4.0 strategy and Malaysia, its recently launched Digital Free Trade Zone – responding at the national level was not enough.

“Asean nations must think at a regional level. Consider regional data – the 4IR is built on data but data needs to flow easily across national borders. If not, countries will miss out on the huge opportunities.

“Of course, there are important concerns about data privacy and security as well as taxation and legal protection when services are provided across borders but that is why Asean must respond from a regional perspective.

“We must craft regulations that work across countries,” he said.

Nazir said the EABC had prepared a report on 4IR for the Asean leaders and in it, it recommended an upgrade for the Asean Secretariat.

“The Asean secretariat must be strengthened. We have recommended seven areas where this can be done,” he said, naming two of them.

“The first would be to turn it into a platform organisation – just like Apple or the Android operating systems on your phones. They run on platforms in which third parties develop apps.

“Similarly, the secretariat can become an operating system for regional integration.

“It will govern but third parties will do the job of developing policies and regulations,” he said.

The second recommendation, he said, was to increase funding for the secretariat, which currently saw all Asean countries contributing US$2mil (RM8.4mil) a year, giving it a US$20mil (RM84mil) budget.

“This is not nearly enough. By some estimates, Asean needs a budget of US$220mil a year.

“Our report recommends a funding model based on the size of the country’s GDP so that big economies end up paying more than the smaller economies – like we have at the United Nations,” he said.

Nazir later presented the EABC Report to Philippines president Rodrigo Duterte, the chair of the 31st Asean Summit.