East Asia and the Pacific: Remarks at the APEC-TEL Ministerial Meeting


Remarks by Under Secretary Catherine A. Novelli
Department of State Senior Coordinator for International Information Technology Diplomacy 

APEC TEL Ministerial
March 30, 2015

Good afternoon. I am pleased to join you all in Malaysia at this year’s APEC TEL Ministerial. I would like to personally thank the Government of Malaysia for hosting this meeting and, in particular, Minister Dato’ Sri Ahmad Shabery Cheek, our chair.

Taken together, APEC and its 21 member economies represent three billion people and three-fifths of the global economy. And, over the next five years, nearly half of total economic growth is projected to come from right here, in Asia.

Today, APEC economies rank among the world’s strongest digital economies. Years ago, many APEC member economies developed policies that enhanced competition, allocated spectrum efficiently, and promoted private sector investment in their telecommunications infrastructure. As a result, these economies now benefit from strong broadband adoption rates and thriving e-commerce markets. In the Republic of Korea, 80% of the population is online – that’s the highest rate in the world. Moreover, the Internet economy is responsible for approximately 9% of Korea’s GDP and 30% of its exports. Another example is: Japan. Among the top 250 largest Internet companies, Japanese firms received a full 20% share of total revenues, according to a recent McKinsey study.

Thanks to its government policies and practices, I am thrilled that Malaysia has also emerged as a strong leader in the region. Malaysia’s telecom sector has grown significantly in the last decade, with a remarkable 67% broadband Internet penetration among households. And today, six of the eight biggest publically-traded ASEAN Internet companies are located in Malaysia.

The Internet – this marvelous engine of economic growth and innovation – did not develop by happenstance in these economies. These economies are now digital leaders because of a regulatory environment that encouraged investment rather than government micromanagement. In Asia, and everywhere, the Internet of tomorrow will have its roots in the public policy of today.

In the United States, it was massive private sector investment that moved the Internet from a government project into every home in the nation. That’s why we hope that APEC member economies will adopt a “light touch approach” to the Internet – one that encourages investment and fosters innovation.

To ensure that the Internet continues to grow and benefit an increasingly wide and diverse global population, I urge APEC Ministers to promote policies that first increase broadband access; and second facilitate the free flow of information across borders.

First – broadband access. We remain concerned that every country does not share equally in the Internet’s benefits, particularly in the developing world. Three years ago, the United States announced the creation of the Alliance for an Affordable Internet. This multinational, multi-stakeholder coalition advises government policymakers in developing markets on how to build stronger markets that will attract investment and lower prices for their citizens.

We hope that more APEC member economies join the United States in supporting the Alliance in 2015. As I noted, because of their underlying government policies, many APEC economies are currently experiencing tremendous innovation and growth in their Internet economies. These APEC Members are role models for other countries throughout the world. They are uniquely situated to guide developing countries and other emerging markets on how to best extend the Internet’s benefits to their citizens.

Through public-private initiatives like the Alliance, we can drastically accelerate economic growth in developing countries. Of the developing world’s 1.4 billion extremely poor people, 70 percent live in rural areas. Their lives can be transformed by connecting villages to the web, bringing telemedicine to remote rural health centers, providing accurate weather information to farmers and fisherman, and supplying up-to-date market information to producers. For every ten percent increase in a country’s Internet penetration, its total economic growth expands by one to two percent.

In the 2014 APEC Leaders Statement, we recognized the critical role of the Internet Economy in “empowering economic participation” and we urged Ministers to put forward proposals for action that bridge the global digital divide. In advance of the next APEC Leaders Meeting, the United States wants to work with all of you to help ensure that the necessary resources, training, and technology are available to bring the benefits of the Internet to everyone.

APEC has long focused on broadband deployment and bridging the digital divide. In 2008, APEC was on the cutting edge. We worked hard to produce a Digital Prosperity Checklist that outlined plans for APEC economies and the private sector to foster greater participation in the digital economy. But frankly, since then, APEC’s work has fallen behind. At the upcoming APEC Leaders meeting, we should recommit ourselves to close the global digital divide with specific proposals for programs and future work.

The second priority is ensuring an open Internet. Economically, companies of all types and sizes share in the benefits of cross-border data flows – not just companies that we think of as digital. A recent study, for example, highlighted how 75 percent of the value added by data flows on the Internet, accrues to “traditional industries”, like oil and gas or manufacturing and retail companies.

However, policies that restrict data flows, such as localization requirements, impair this economic growth. Data localization requirements stem from a fundamental misunderstanding of how the Internet works. Imagine a world where every country adopted such requirements. In this world, data stops at national borders. Then, it is examined to see whether it is allowed to leave the country and possibly taxed when it does. As a result, all technology or Internet start-ups would face much higher barriers to market entry – they would have to build a physical local infrastructure in every jurisdiction in which they operate. And, these infrastructure costs are staggering.

To build a data center in Brazil, Chile or the United States, per some estimates, a Korean, Japanese or Malaysian technology start-up would spend $60.9 million in Brazil, $51.2 million in Chile, and $43 million in the U.S., with enormous additional energy and other operating costs. That creates extremely high barriers of entry for indigenous Internet and technology companies in Asia and across the world. Working together, we must oppose these efforts.

APEC has a proud tradition of promoting discussions around trade among APEC member economies. Such discussions have significantly advanced multilateral negotiations. APEC-TEL should now play an analogous role in promoting norms that will preserve the Internet’s future. We are all here today because we care about the future of the Internet.

Working with like-minded governments, like Malaysia and other APEC member countries, we look forward to ensuring that the Internet remains vibrant and continues to be a conduit to better the lives of people worldwide. The Internet belongs to everyone. Let’s take steps at APEC TEL and at the upcoming APEC Leaders Meeting to help keep it that way.

Thank you.

Food Reaches All Cyclone-Affected Islands In Vanuatu

Government-led food distributions including WFP’s high-energy biscuits, reach Aniwa island, Tafea province. WFP/Victoria Cavanagh.

BANGKOK/PORT VILA– Two weeks after Cyclone Pam hit Vanuatu, food has reached all 22 cyclone-affected islands for more than 160,000 people. The United Nations World Food Programme (WFP) is supporting the government-led relief effort by organizing distributions, logistics services, and providing extra food to supplement government food packages where necessary.

•    Government food packages include a two-week supply of rice, canned fish and meat, and noodles. WFP is supplementing this with 200 metric tonnes of locally-purchased rice and 40 metric tons of biscuits fortified with vitamins and minerals. The biscuits, which were airlifted to Vanuatu, are being sent to nine priority islands where families have limited access to clean water to cook food.

•    After the initial relief phase, WFP plans to provide further food assistance to the most vulnerable until they can provide for themselves. A team of food security experts is on the ground to build a detailed picture of the needs.

•    WFP has brought in emergency equipment from WFP-managed UN Humanitarian Response Depots in Dubai and Malaysia to help the government with the management of the large volume of relief cargo arriving in Vanuatu. WFP has set up mobile storage units at Port Vila airport for relief items and a further hub is being set up on Tanna island.

•    The WFP-led Emergency Telecommunications Cluster and its partners are providing connectivity at seven sites across Vanuatu for use by the government and humanitarian community.

•    A UN Flash Appeal, launched in Port Vila on 24 March, seeks US$29.9 million to cover the needs of 166,000 cyclone-affected people for three months. WFP requires up to US$6 million for food assistance activities and US$2.3 million for logistics and telecommunications services.

•    WFP is grateful for contributions received from the Government of Australia, as well as logistical support in the form of cargo aircraft made available by the Government of Australia and the Government of the United Arab Emirates.

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WFP photos of food being distributed on Vanuatu’s Aniwa island (Tafea province) on 26 March are available at the below link. Photo credit: WFP/Victoria Cavanagh.

To download WFP photos: https://www.hightail.com/download/UlRUUWVqQzdGOFJvZE1UQw

WFP is the world’s largest humanitarian agency fighting hunger worldwide, delivering food assistance in emergencies and working with communities to improve nutrition and build resilience. Each year, WFP assists some 80 million people in around 75 countries.

Follow us on Twitter @wfp_media and @wfp_asia

For more information please contact: (first name.last name@wfp.org)
Victoria Cavanagh, WFP/Port Vila, Mob. +678-546-9846
Silke Buhr, WFP/Bangkok, Mob. +66-81-701-9208
Zoie Jones, WFP/Rome, Tel. +39 06 6513 3940, Mob: +39 342 902 5566
Gregory Barrow, WFP/London, Tel.  +44 20 72409001, Mob.  +44 7968 008474
Bettina Luescher, WFP/New York, Tel. +1-646-5566909, Mob.  +1-646-8241112

How will the jailing of Anwar Ibrahim impact Malaysia’s foreign relations?

Authors: Murray Hiebert and Nigel Cory, CSIS

Malaysian opposition leader Anwar Ibrahim’s seven-year fight against sodomy charges ended on 10 February 2015. His five-year prison sentence was widely seen as a victory for his political opponents in using the law to silence him (again). The opposition coalition will struggle to overcome the loss of its leader. But Prime Minister Najib Razak is expected to face minimal international pressure on the verdict.

Anwar’s case was seen by many as an attempt by the ruling United Malays National Organisation (UMNO) party, which has been in power since Malaysia’s independence in 1957, to eliminate Anwar from the political landscape. In 2013, the opposition coalition came close to achieving Malaysia’s first change of government. It won the popular vote in the national elections, but fell short of gaining a majority of seats in the highly gerrymandered electoral system. Anwar was seen as the lynchpin to the opposition’s success.

There were accusations of political interference in Anwar’s sodomy trial from the start. Reports stated that Najib met the man Anwar allegedly sodomised two days before the act reportedly took place in 2008. Anwar’s lawyers raised questions early in the trial about whether the DNA samples had been properly maintained and had possibly been contaminated. They also expressed concern that the major evidence presented against Anwar was the alleged victim’s statements which were never corroborated by other sources.

In January 2012, a High Court judge agreed that the DNA had been compromised and acquitted Anwar. But the Court of Appeals overturned this ruling in March 2014. The judges argued that the High Court had made a mistake in doubting the integrity of the DNA and reinstated the original guilty verdict and a five-year prison sentence. At the time, the United States and other countries condemned the verdict saying that it showed Malaysia’s judiciary was neither independent nor fair.

The opposition coalition is at a critical juncture as it prepares to elect new leaders. The problem is that there is no clear successor. The next generation significantly lacks Anwar’s charisma and political skill. In the meantime, the opposition leadership has fallen to Anwar’s oldest daughter Nurul Izzah Anwar. The 34-year-old, who has twice served as a member of parliament, represents the next generation in political leadership, but there are many doubts about her ability to fill Anwar’s shoes.

The opposition’s task of rebuilding is made harder with the death of Nik Aziz Nik Mat in February 2015. Nik Aziz was the head of the opposition Pan-Malaysian Islamic (PAS) party, one of the component parties of the opposition coalition. Anwar and Nik Aziz were essential in keeping the disparate members of the coalition together and on message. The contest to replace Nik Aziz in his own party will be crucial to determining PAS’s future in the opposition. There is a faction within PAS that wants to break away to join UMNO because of their shared Islamic values and policies.

Najib has not gained much politically from Anwar’s removal as his main opponents are within his own party. Former prime minister Mahathir Mohamad has mounted an increasingly bitter fight to undermine and remove Najib.

Although the domestic struggles are obvious, the foreign policy implications for Malaysia are less clear. Malaysia is safe from criticism from its neighbours in ASEAN as the group adheres to the principle of non-interference in the affairs of other countries. The problem for Najib is that the international spotlight will focus on Malaysia in 2015 as it serves as the chair of ASEAN and the host of the East Asia Summit (EAS).

The United States’ cautious reaction to Anwar’s jailing stands in contrast to its condemnation of Malaysia following his first imprisonment. The US appears to have decided that it cannot afford disengagement and high-handed rhetoric because it has considerable interests attached to the 2015 ASEAN summit and EAS meeting. Malaysia also plays a critical role in the Trans-Pacific Partnership trade negotiations, which could be completed this year.

The US administration appears to remain committed to building its comprehensive partnership with Malaysia. It has maintained its invitation for Najib to visit Washington ahead of the EAS. Protests about Anwar’s imprisonment will likely arise during Najib’s visit, but the White House seems likely to downplay those concerns due to its broader interests in Malaysia and the Southeast Asian region.

Murray Hiebert is a senior fellow and deputy director of the Sumitro Chair for Southeast Asia Studies at CSIS.

Nigel Cory is a researcher with the Sumitro Chair for Southeast Asia Studies at CSIS and previously served as an Australian diplomat in Malaysia.