As we move into the digital age, countries need to start using the technology available to keep their economies strong. And one of the best places a country can venture into, to transform its economy is cyberspace.
As we mentioned in our previous article: How Smart Cities Can Help Boost Malaysia’s Economy Malaysia is pushing to becoming a high-income economy by 2020. Digital technology is the perfect way to achieving this goal.
States like Sarawak see the potential of cyberspace transforming the local economy, and are already leveraging on it. Chief Minister Datuk Patinggi Abang Johari Tun Openg, commented on the fact that the digital revolution is moving fast and that the world is already readying itself for Industry 4.0 with artificial intelligence, augmented reality, smart data and facial recognition.
E-commerce has also played a role in peninsular Malaysia’s growth. Statistics show that the platform garnered RM4.2 billion by the end of 2017. What’s more, it is expected to generate RM9.8 billion by 2022. The high adoption rate of e-commerce was thanks to the increase in internet availability, the increase in the number of computer users and because these services make available products that may not be easily available in a regular shop.
Malaysia had a little more than 15 million active e-commerce users in 2017; that is 47.9 per cent of the Malaysian population. With more affordable internet plans coming in each year, those numbers are expected to rise exponentially.
C2C (customer to customer) platforms like Lazada, Zalora, 11street, Shopee, Alibaba, Amazon and ebay have made it easier for people to buy and sell products leading to a rapid growth in the industry. They also encourage the use of payment gateways like PayPal and online banking.
The 2000s saw the rise of online stores and that trend is still going strong today. These stores are now playing a big role in the contribution of the country’s economy, making it possible for everyone to trade money and products from within and outside of Malaysia.
Sarawak Chief minister Abang Johari also brought attention to the fact that there were some new key trends in e-Commerce that Sarawak needed to pay heed to like digital payment, social media presence, the emergence of online to offline (O2O), and a new retail model.
He pointed out that Sarawak had taken steps towards cashless services, like the collaboration between Malaysia Airport Holdings Bhd (MAHB) and Kuching International Airport (KIA) to popularise the of VCASH apps in all retail outlets in KIA.
He said that Sarawak would be focusing on providing the infrastructure needed for the populace to take part in the digital economy. He talked about how they needed the community, especially the younger generation, to rise up in terms of their socio-economic wellbeing and thus enjoy their livelihood.
He also mentioned the areas that Sarawak and China work together in tourism, health, education, construction and e-commerce. He stated that as the world is more connected, the future would be one that is shared by everyone.
2017 has been a vital year for e-commerce in Southeast Asia; the Malaysian government has publicly noted the huge potential of e-commerce to the development of the nation. With this in mind, the Digital Free Trade Zone (DFTZ) was established in 2017, in cooperation with Jack Ma and Alibaba, as part of Malaysia’s 2025 development plan.
The Malaysian e-Commerce market is gaining in attention and support from the government. Rising incomes, growing smartphone and internet penetration are all factors that will grow Malaysia’s online market from 0.5 percent of total retail spending in 2014 to five percent by 2020. E-Travel is the largest segment of the online market and includes mobility services (such as GrabCar and Grab Taxi) and online travel bookings.
To conclude, the world is growing and that growth has only become faster thanks to technology. As we said at the beginning, the best way to keep the country’s economy strong is through leveraging technology, and that includes digital technology and cyberspace.