Indonesian Coordinating Minister for Economic Affairs Airlangga Hartarto urged Southeast Asian nations to fast-track the completion of the Asean Digital Economy Framework Agreement (Defa), saying the landmark regional pact is critical to sustaining growth amid global economic uncertainty, geopolitical tensions and rising protectionism.
Speaking before business leaders during the Indonesia-Philippines business forum held in Lapu-Lapu City on May 7, 2026, Hartarto said Asean must move quickly to finalize the agreement during the Philippines’ leadership of the regional bloc, stressing that prolonged negotiations could delay opportunities in one of the fastest-growing sectors of the economy.
“The whole world is looking at Defa,” Hartarto said, noting that negotiations have already gone through around 20 rounds since discussions began under Indonesia’s Asean chairmanship in 2023. “We don’t need perfection, but we need to move on.”
Scope of the Agreement
The proposed agreement aims to establish a common framework for digital trade, electronic commerce, digital payments, data governance and other areas of the digital economy across the 10-member Asean bloc. Hartarto described the pact as the region’s response to growing economic risks, including energy price volatility, food security concerns and global trade tensions.
“This is the economy of the younger generation. This is the economy that is not prone to tariff war,” he said.
Major Growth Driver
He said the digital economy could become a major growth driver for Asean as traditional industries face disruptions from inflation, geopolitical conflicts and rapid technological change, including artificial intelligence. The Indonesian minister also revealed that Jakarta had already resolved its issues related to the agreement and called on other Asean members to compromise to complete negotiations.
“We can always evaluate implementation for every country,” he said, adding that no single nation should dictate how others implement digital policies.
The Defa is expected to become Asean’s first comprehensive regional agreement focused solely on the digital economy, including financial services and cross-border digital transactions. Analysts have said the agreement could help harmonize digital regulations across Southeast Asia, lower business costs and accelerate cross-border investments, particularly in fintech, e-commerce, cloud computing and digital infrastructure.
Closer PH-Indo Cooperation
Hartarto also highlighted opportunities for closer Philippines-Indonesia cooperation in digital infrastructure, particularly in Mindanao, where Indonesia is developing a fiber optic landing station in Manado. He proposed the establishment of data centers and digital infrastructure projects connected to the Philippines, citing Mindanao’s available land, renewable energy resources and talent pool.
“The talent in the Philippines is so many,” he said. “We can create talent and make more solid growth toward the future.”
Beyond digital cooperation, Hartarto also pushed for stronger collaboration between the two countries in nickel processing, special economic zones, agriculture and fertilizer supply as both nations seek to strengthen regional supply chains. He said Indonesia and the Philippines, among Southeast Asia’s largest economies by population, are well-positioned to drive regional growth despite external economic pressures.
The Indonesian official noted that while the global economy is slowing due to geopolitical shifts, climate risks and elevated energy prices, Asean economies remain relatively resilient. Indonesia’s economy expanded by 5.61 percent in the first quarter while inflation remained manageable at 2.42 percent, he said.
