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NEW FACES OF ASEAN PART 1 Virtualizing ASEAN Chinese Diaspora in Southeast Asia – Driving Growth, Building Virtual Nations?

Safe to Eat? E-traceability and ASEAN Interview with Dr. Henry Yeung Text Mining for Technology Foresight

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ISSUE 10 - NEW FACES OF ASEAN PART 1

LEADER Welcome to Issue 10 of TrendNovation- a monthly magazine devoted to discussion of long-term technological, social and political trends in Southeast Asia. Issue 9 of TrendNovation focused on social entrepreneurship, a phenomenon which promises to transform societies around the region. Issue 10 and 11 step back to contemplate diverse trends or movements which are already giving a new face to ASEAN. In this issue we look at three very different trends, that are profoundly changing the way we do business and the way political and economic power are shared. We also see how ICTs are helping Asia’s food growers adapt to the pressures of globalization and food safety concerns.

By Wyn Ellis Chief Editor

In his article, ‘Virtualizing ASEAN’, Prof. Marvin Beduya of the Asian Institute of Management (AIM), Philippines, argues that despite the rhetoric around ASEAN economic integration, in reality, the wide differences in levels of development among its members represent major challenges to accomplish closer political and economic union. The article hints at the chasms created by the unique national identities and strategic interests of each of ASEAN’s member states.

As a counterpoint to the many forces which divide the region, we look at the Chinese diaspora, its reach and its potential significance as a unifying factor.

‘Chinese Diaspora in Southeast Asia – Driving growth, building virtual nations’ explores the notion that ICTs have given diasporas unprecedented economic, cultural and political bargaining power, to the extent that the primacy of geography and national frontiers as determinants of economic and political power have been eroded in favor of building on shared political, social, economic and cultural alignments. Does this herald the arrival of the ‘Virtual nation’?

‘Safe to Eat? E-traceability and ASEAN’ zeroes in on the food industry, as a major driver of the region’s economy, to make several points. The fast-growing intraregional trade in foods among ASEAN countries has raised thorny questions over how countries will share data to ensure the safety of our food supply. This article introduces the concept of food traceability and its enabling technologies, and the need for ASEAN members to harmonize traceability systems regionwide. Finally, we consider the potential impact of ‘Farm-to-Fork’ traceability on production patterns in the region’s export-led economies, and its possible adverse impact on resource-poor small farmers who may be excluded by everhigher technological barriers to market access.

TrendNovation this month interviews Henry Wai-chung Yeung, Professor of Economic Geography at the Department of Geography, National University of Singapore. Prof. Yeung is renowned for his research into theories and the geography of transnational corporations, Asian firms and their overseas operations, and Chinese business networks in the Asia-Pacific region.

Finally, in the Trend Tools section, Sadudee Vongkiattikachorn considers another forecasting technique: text mining and its applications.

TrendNovation is available online at http://www.trendsoutheast.org. As always, your comments and feedback are invaluable to us.

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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Virtualizing ASEAN By Prof. Marvin Beduya Adjunct Professor at The Asian Institute of Management in Makati, Philippines

About The author: Prof. Marvin Beduya Marvin Beduya is an adjunct Professor at the Asian Institute of Management in Makati, Philippines where he teaches New Product Development, Innovation and Entrepreneurial Finance.

He is also a management consultant in change management and entrepreneurial finance. He writes a blog on development for emerging markets focused on innovation systems, co-evolution of institutions, and modern industrial policy at http://synthesistblog.com.

IDEA: Keywords used in the ASEAN Vision 2020 statement at Kuala Lumpur in 1997 implied an undefined view, almost a virtual ASEAN community. ASEAN was called variously as a partnership, a community, a market, a concert and a Zone. Significantly, one word that was not used suggests there was no vision then of ASEAN as a Union governed by a supra-bureaucracy.

Strong and weak impulses constantly pull together or further divide the ten member nations. These impulses also interact with each other. ASEAN has come a long way from its founding in 1967 but will need to do more to build a stronger collective. Specifically these impulses that contribute to the grand scenario on what virtualization of ASEAN may look like are: A. Impulses that tend to hold or pull together 1. Legacy and co-evolving institutions, 2. Links and networks from the Internet, communications technology and logistics, and 3. Centripetal attraction from climate change and sustainability.

B. Divisive impulses

KEYWORDS: Virtual ASEAN; social diversity; internet technology; logistics; economic gap; climate change; China; Institutionalization 1. Differences in development levels create a powerful centrifugal force, 2. Demographic size and diversity, and 3. China is the giant Panda?

From these considerations, our conclusion is not whether further and closer integration will happen but when. Meanwhile, the pressing needs and constraints of the time may create more bi- or multi-lateral ties between members on specific issues of interest.

Scenarios: Differences in development levels create a powerful centrifugal force: The differences in the levels and aspects of development are the biggest obstacles to closer ASEAN integration on the ground. The lessons from the painful early stages of German unification, and of EU’s current money problems, and the counterfactual success of the Hong Kong-China “one country-two systems” highlight the formidable obstacles that will confront any economic and political union.

Demographic Size and Diversity: With an economy of US$3 trillion growing at 7.5% and a population of 613.8 million (Central Intelligence Agency, 2011), ASEAN represents a market almost equal to India and half of China and growing at a respectable gallop.

China is the Giant Panda?

The influence of large and fast growing emerging markets at the periphery of ASEAN (particularly China) is a weak impulse pulling apart ASEAN integration. The relationship is defined by growing trade between Chi-

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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na and ASEAN member countries and by four other current issues: the Spratly dispute, dams on the Mekong River, railways from Kunming to Singapore, and the gas lines through Myanmar. It will also be affected

by China’s choices regarding North Korea and its relationship with Japan.

Legacy and Co-evolving Institutions: The ASEAN Directorate is working hard to design programs to meet the 2020 vision (Association of Southeast Asian Nations, 2011) from the Blueprints listed in the table below. This will tend to bring ASEAN members closer together even though some of these programs tend to create multi-speed development tracks that do not help integration.

Links and Networks from the Internet, communications technology and logistics:

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promote integration. Otherwise, the alternative scenario built around bilateral or sub-regional approaches will become de facto in a multi-track community building.

Centripetal attraction from climate change and sustainability: One of the many key findings of an ADB report on climate change is that the region will lose 75% of its present rice growing areas in the worst case climate scenario when nothing is done today to address the potential problem (Asian Development Bank, 2009).

For ASEAN this of course is a common concern due to rice’s place at the heart of Asian diets, and the importance of rice exports to the economies of ASEAN nations.

Implications: •

Implementation of new institutions and infrastructure such as a customs union, together with improved air, sea land transport linkages and intellectual property protection as designed in the Blueprints, will further •

•

•

• • Source: http://plus-pack.blogspot.com/2010/10/aseanpunching-above-its-weight-in.html

Until ASEAN’s members agree on the need for a development strategy that leads to economic convergence, it will most likely remain a virtual collective. The overall level of concern will be an important factor driving the pace of integration into the ASEAN Economic Community (AEC).

The large aggregate ASEAN market size remains a weak force for unification in the absence of more institutional innovations aimed at creating a more seamlessly connected market and investment area.

China will be a focus of member states individually and not necessarily as a force towards Union. China will be happy to keep ASEAN weak institutionally.

Policy implementation by sub-groups such as ASEAN-4 or ASEAN-6, have been used to overcome difficulties arising out of the distinctive flights noted above. Given the multispeed tracks thus assumed, this can probably lead to an ASEAN community at some future time; as time goes by, the prospect of an effective functioning multilateral solution will be further hampered by ongoing proliferation of bilateral trade agreements among members and between members and third countries / blocs.

The availability of these links and networks will themselves reinforce and promote unity.

Loss of food growing areas and need for shared agricultural and food technologies, given similar cuisine and food requirements can be a strong unifying force.

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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Early indicators: •

•

•

•

• •

Convergence in GDP growth rates per capita especially faster growth rates for those in catch-up will indicate a reduction on this centrifugal impulse.

Success of initiatives such as the ASEAN free trade area and a customs union facilitates trade among member nations, as evidenced especially by inter-ASEAN investment by regional companies.

For integration, a good early indication would be deals between China and an ASEAN-2 or an ASEAN-4 entity say on the Mekong River or better still ASEAN-5 with Myanmar taking its rightful place.

Success of ASEAN1 in meeting the key milestones in its Blueprint of integration in the political-security, economic and socio cultural fields.

Construction of actual linkages and nodes in communications and logistics.

Setting up of information and diffusion exchanges among member nations.

Drivers & Inhibitors: Drivers: •

• • • •

•

Investment flows especially those from other ASEAN members will stimulate convergence.

Benefits of economies of scale as perceived by internal and external investors facilitated by investment flows and links above.

China can be a force for unification if the ASEAN member-nations see unity as a source of bargaining power.

Perceived benefits by ASEAN bureaucrats in implementing institutions at the regional center.

An interesting story here is about the shift of the Taiwanese sugar industry to flowers (Rodrik, 2007) where modern industrial policy facilitated the transition. If ASEAN is able to negotiate a convergence strategy for development, then approaches like this will help in integration.

Perceived benefits of such integration.

Singapore and Brunei can take the lead with investment projects within ASEAN being consumer countries with small food production areas.

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Inhibitors: •

• • • •

•

Investments in developing members will inherently be more risky and need to be mitigated with incentives to cover sources of added risks.

National champions that are threatened by entry of competition from champions of other ASEAN countries are the main inhibitor.

China will see it in her best interest to keep the ASEAN members as a loose confederation to limit its political and negotiating power.

Power struggles among national political vested interests to protect their turf.

Differences in levels of development especially in those factors directly affecting competitiveness – say in agricultural products such as rice and sugar work to push apart and delay integration via political processes.

Lack of political consensus given the voting power of rural interests.

From the examples above, we may anticipate much greater interest and participation by future entrepreneurs in this rapidly evolving field. The increasingly more intense networking among social enterprises, together with growing public sector support offers the prospect of new and unexpected alliances, new business models and new approaches to enable social entrepreneurs to work more effectively. This carries strong and encouraging implications for solving issues at community, country and regional levels, and of course, to give a boost to the goal of sustainable development. Dare we wish for a kinder, more caring world?

References (superscript) ASEAN-2 for bilateral relations of ASEAN member states, ASEAN-4 for multilateral groups, and ASEAN-5 (Indonesia, Malaysia, Philippines, Singapore, and Thailand).

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Asian Development Bank. (2009). The Economics of Climate Change in Southeast Asia: A Regional Review. Manila: Asian Development Bank.

Association of Southeast Asian Nations. (2011, March). ASEAN Vision 2020 and Community Blueprints. Retrieved March 23, 2011, from Association of Southeast Asian Nations: http://www.aseansec.org/ Bremmer, I. (2010). The End of the Free Market: who wins the war between states and corporations? New York, NY: Portfolio, a member of Penguin Group (USA).

Central Intelligence Agency. (2011, March 23). Comparison of ASEAN member nations - GDP, Industry Structure, etc. Retrieved March 23, 2011, from The World Factbook: https://ww.cia.gov/library/publications/ the-world-factbook/ Rodrik, D. (2007). One Economics, Many Recipes: Globalization, Institutions and Economic Growth. Princeton, NJ: Princeton University Press.

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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The Chinese diaspora in Southeast Asia: Driving growth,

building virtual nations?

By W Wyn Ellis, Bangkok-based researcher and consultant in innovation and agricultural development

IDEA: The word ‘Diaspora’ derives from the Greek verb speiro (to sow) and the preposition dia (over). The ancient Greeks used it to mean migration and colonization (Ma and Cartier, 2004). Although the term originally connoted exodus, oppression, uprootedness, a collective memory of one’s homeland, and a strong desire to return to it one day, today the term is freed from stigma, and refers to groups of people dispersed from their native and ancestral homelands for whatever reason.

This article explores the notion that today’s globalized world has given diasporas unprecedented economic, cultural and political bargaining power, and also, taking Singapore as an example, to argue that the various characteristics of today’s diaspora resemble the necessary conditions of a ‘virtual nation’- signifying an ongoing reconfiguration of power relationships, that erodes the primacy of geography and national frontiers as determinants of economic and political power, in favor of building on shared interests and political, social, economic and cultural alignment.

KEYWORDS: Diaspora; migration; mobility; Singapore; national identity; virtual nation gime propaganda, citizens have toppled despots and exposed the systematic oppression of their peoples. As autocratic governments wring their hands at their impotence to control and contain dissemination of “people’s news” from their respective countries to the world, citizens for the first time are able to access global news and critique, and fight their own personal information wars.

Of course, political activism is just one facet of the role of diasporas in shaping life back home. Take Singapore - a nation-state founded on diasporic roots (particularly the Chinese diaspora) as an example. Though Singapore has the highest concentration of ethnic Chinese- 3m, or 75% of its population, Singapore is unique in Southeast Asia in the richness of its ethnic mix— with vibrant, structured communities from countries ranging from Malaysia, Thailand, Indonesia and the Philippines to the Indian subcontinent. For Singapore, the significance and influence of the diaspora phenomenon has several distinct dimensions, as exemplified below: •

• •

Scenarios: With today’s mobility of labor, instant global communications, and pervasive access to simple, powerful and secure social networking media, we have witnessed how technology has ended the isolation of Burmese, Hmong, Nepalese, and Chinese political activists scattered throughout the world. Now they are all connected, and from the perspective of any repressive regime— dangerously so. Secondly, we have seen how dissident activists all around the world proceeded to use these media not just to keep in touch with friends and family, but also to circumvent draconian censorship at home. Using new technologies to provide an essential counterweight to re-

•

The constantly changing influx of large numbers of shortterm, unskilled and semi-skilled labor, imported from neighboring countries to satisfy Singapore’s continuing economic boom.

Efforts to plug human resource shortages in the IT sector through fast-track immigration of ‘cherry-picked’ talented individuals, particularly from Malaysia, China and India.

Up to 1 million Singaporeans (25% of the population) live overseas. The Singapore government has launched an ambitious program to coax senior-level overseas Singaporeans, especially those working in strategic areas of business and research, to return to contribute at home, through providing long-term opportunities and incentives for them to use their technological or management competencies to drive economic growth back home. Returnees are valued for their much sought-after entrepreneurial and management experience and access to global networks.

The government’s strategic drive to recruit high-caliber “foreign talent” in designated strategic specializations vital to technological advancement and economic development.

The case of Singapore demonstrates the multiple roles and profound social influence of diasporas— extending access to human resources, knowledge, technologies, and markets, and increasingly, in shaping an emerging multicultural identity for the host country.

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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Implications: The multi-dimensional nature of Singapore’s diaspora carries profound lessons for the rest of the Southeast Asian region. For example, Singapore’s other major ethnic diasporas may well exert an uplifting effect in their home countries not just via monthly remittances, but also in terms of exposure to new cultural norms and economic opportunity.

Though hard to measure accurately, the economic power of the Chinese diaspora in Southeast Asia is undoubtedly vast, and by any estimate, comparable to that of individual nation states (Cheung, 2004). The Chinese diaspora is already responsible for a significant proportion of total private sector investment in the developing economies of the region. Cheung and others have characterized the flexing of the considerable economic and political muscle of the Chinese diaspora in Southeast Asia as the emergence of a ‘Virtual Nation’, and certainly, this trend carries implications for regional and national political economies. The core ethos of the virtual nation as an extension of networks leveraging the power of family connections for collective survival and thence to commercial success, is to ‘look after one’s own’, even, perhaps, at the expense of ‘outsiders’, e.g. local communities. Taking this further, we might also assume the virtual nation, as a highly capitalistic organizational structure, to allocate fewer resources to public goods than might its conventional counterpart. Correspondingly, the poor may not benefit from ‘trickledown’ affluence generated by virtual nations, leading to wider income disparities and Gini coefficients.

But with China ramping up its political and economic influence in SE Asia, what will be the roles of these diasporas? It remains to be seen whether they may integrate into the China’s grand geopolitical strategies and aspirations, or perhaps will remain as discrete economic, rather than political entities.

Early indicators: •

•

•

In 2000 - Singapore was ranked as the world’s most globalized nation (Kearney, 2001 p. 58) -- a ranking which surely has been reinforced, due partly to the government’s efforts at internationalization since 2001, but which in essence is attributable to Singapore’s role as the de facto hub for overseas Chinese.

Increasing sophistication of linkages among Chinese diaspora across the region, at political, cultural as well as commercial levels, leading to an identifiable emergent community, where the role of geography is gradually been ousted from its role as the key identifier of a nation. Stephen Krasner’s comment in 1999 was prophetic, “…the characteristics that are associated with sovereignty – territory, autonomy, recognition, and control – do not provide an accurate description of the actual practices that have characterized many entities that have been conventionally viewed as sovereign states”.

Increasing globalization is reconstituting the economic landscape, and erodes the concept of sovereignty as an economic and political entity, and countries / national governments have diminishing control over actual practice, at least in the area of trade, compared to a highly globalized

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•

•

corporate sector.

Support for the concept of ‘nation state’ is steadily declining. Even in Singapore, murmurs of political discontent are emerging from the middle classes- unthinkable just a few years ago.

As the key to Southeast Asia’s future growth and development, Southeast Asia’s Chinese diaspora is increasingly flexing its economic power; the patterns of money flow generated will provide a signature for the next wave of economic liberalization in the region.

Drivers & Inhibitors: Drivers: Several aspects of the emerging power of the Chinese diaspora may carry profound influences in driving political, economic and civic life in the future: •

• • •

The economic power of the Chinese diaspora is already shaping the formation of a new economic landscape, create a virtual image of economy that transcends national boundaries.

The diaspora’s economic power, citizenship and ethnic solidarity contribute increasingly to the rise of a new paradigm of the ‘Virtual nation’ vis-à-vis the ‘Nation-state’.

The diaspora will grow as an increasing force in political reform.

The diaspora’s achievements abroad will increasingly contribute to Singapore’s image as a global nation-state.

Inhibitors: • •

Concerns over political influence over the Chinese diaspora by the Chinese government Rising concern over signals of Chinese ambitions to hegemony, and especially, a rising suspicion over its intentions in regard to control over natural resources worldwide, not only in Asia itself.

About The AUTHOR: Wyn Ellis Wyn Ellis is a Bangkok-based researcher and consultant in innovation and agricultural development, and serves as Chief Editor of TrendNovation Southeast. He can be reached at asiaag@truemail.co.th

References Ma, L. J.C. and Cartier, C. (2003) The Chinese diaspora: space, place, mobility, and identity. Lanham, Maryland; Rowman and Littlefield (Publishers).

Cheung, G. C. K. (2004) Chinese diaspora as a virtual nation: interactive roles between economic and social capital. Political Studies, Vol. 52, pp. 664–684.

A.T. Kearney, Inc. Global Policy Group & Foreign Policy Magazine (2001), “Measuring Globalisation”, Foreign Policy, 122, pp. 56-65.

Krasner, S. D. (1999) Sovereignty: Organized Hypocrisy. Princeton NJ: Princeton University Press.

Mak, L. -F. and Kung, I. -C. (1999) ‘The Chinese Diaspora Network: Forms and Practices in Southeast Asia’, PROSEA Occasional Paper No. 26, Academia Sinica, Taiwan, pp. 1–18.

Ohmae, K. (1995) The End of the Nation State: The Rise of Regional Economies.

New York: Free Press.

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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Safe to eat?

E-traceability and ASEAN By Mr. Chatta Udomwongsa and Mr. Wyn Ellis

IDEA: Ensuring food safety in the ASEAN region The fast-growing intra-regional trade in foods among ASEAN countries has raised thorny issues over how countries will share data to ensure the safety of our food supply. The need to harmonize regulatory regimes and data-sharing protocols has become a hot topic for debate. This article introduces the concept of food traceability, especially the need for ASEAN members to harmonize traceability systems region-wide. We consider the enabling technologies that can make this possible, and finally, take a look at the potential impact of “Farm-to-Fork” traceability on production patterns in the region’s exportled economies, and its possible impact on resource-poor small farmers.

Scenarios: Over the past decade, food supply chains have become much longer and more complex as food is increasingly sourced from growers and exporters across the globe.

Food can be made available from farm to supermarket within 24 hours. But, chastened by major food safety scares in importing countries =(especially among EU member states and USA), mounting concerns over food safety and authenticity of food , supply chain actors have come under increasing scrutiny, and are today required to record, verify, and document all produce passing through their hands.

The EU’s food hygiene regulations have for some years required farmers, processors and distributors to implement ‘farm to fork’ traceability. EU Regulation EC/178/2002 which came into force in 2005 defines traceability as “the ability to trace and follow food, feed, and ingredients through all stages of production, processing and distribution”.

ASEAN’s forthcoming economic integration into a single market- the ASEAN Economic Community (AEC) will greatly boost intra-regional trade. Whilst this will certainly

KEYWORDS: Traceability; food supply chain; food safety; food standards; ASEAN; AEC; technological innovations; production pattern boost regional GDP, the prospect of free circulation of food and feed products among ASEAN countries greatly heightens food safety concerns. Historically, individual companies rarely survive a food contamination incident, and the consequences of EU import bans on export-led economies in Asia can be far-reaching and long-lasting.

Understandably, this presents major regulatory headaches for ASEAN’s food safety agencies, exporters and retailers.

With the aid of technology, the concept of food traceability has come of age. Today, it is technologically feasible and cost-effective to track batches of produce from individual farmers across the world, all along the supply chain, right through to the retailer’s shelf. But with the proliferation of software-based traceability solutions, one of the major practical challenges lies in ensuring technological compatibility among competing systems, both among individual actors within a specific supply chain, and more broadly, among countries.

So, how might we track and recall contaminated batches that contain health hazards? How do we monitor and prevent unsafe food from reaching the consumer in the first place? And how do we verify the authenticity and provenance of premium-priced products, which may look identical to produce grown conventionally?

These questions are especially relevant to the ASEAN region, whose economies are heavily dependent on food exports, but which do not as yet have fully effective food alert systems. Future traceability systems can only really be effective in mitigating risks if common requirements – both technological and regulatory - are met by all Member States. Hence the need for harmonization of food safety standards, along with rapid alert mechanisms and information-sharing through traceability systems, that are accepted and interoperable across countries. Recognizing this, ASEAN has established the ASEAN Food Safety Network (AFSN) to provide a cohesive approach for regional and national-level bodies to help harmonize food safety regulations among member countries and ensure transparency in sharing food safety information between exporting and importing countries, both within ASEAN and other trading blocs such as the EU, Japan and USA. But any exchange of data among organizations is sensitive, raising important questions: what information should be shared, how to connect and communicate, how deep to track the data? And, crucially, how to ensure free ex-

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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change of essential data on a ‘need to know’ basis, whilst protecting commercially sensitive proprietary information?

One popular proposal is that the scope of traceability requirements should be confined to recording movement of food one step back and one step forward in the supply food chain, thus giving some degree of protection and commercial confidentiality to companies. As the integration process takes hold in ASEAN, the EU’s own experience will provide valuable lessons in resolving these and other thorny questions raised by mandatory tracking of food, feed, and food ingredients through all stages of production, processing and distribution.

The march towards a ‘Virtual ASEAN’ is inexorable.

Across the region, governments and the private sector face growing pressures to leverage the latest technologies to improve food safety along cross-border food supply chains. Thailand is now implementing a traceability system as a strategy to add value to Thai rice and boost consumer confidence. The Philippines is investing in a US$5 million Traceability Center for Agro-Industrial Exports (P-TRACE), supported by the United Nations Industrial Development Organization (UNIDO). Malaysia has a well-established traceability system for palm oil, driven by the Roundtable on Sustainable Palm Oil (RSPO), and aimed at sustainable production and protection of tropical rain forests and wildlife. And last year, Vietnam, fronted by the Vietnam Association of Seafood Exporters and Producers (VASEP) and the Vietnamese State Agency for Technological Innovation (SATI) introduced a food traceability system for aquaculture based on RFID technology, in collaboration with IBM.

Enabling technologies: As food supply chains have grown in complexity and extended to span the globe, traceability systems will need to be based upon globally accepted standard IT platforms and inter-operability standards. Two technological innovations can be credited with bringing this goal within reach - the GS1 barcode identification system, now ubiquitous and fundamental to commerce, and more recently, passive and active Radio Frequency Identification, or RFID tags. The power and value of both technologies lies in their use of global inter-operability standards, which enable seamless product tracking at each transaction along

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the supply chain. For the future, we can expect technological convergence between enhanced RFID technology and other innovations such as smart sensors to further extend the range of applications and simplify processes.

Impact of Traceability on Production Patterns: Traceability systems serve as a proxy to replace the trust that used to exist when food was locally produced, and when consumers personally knew the producers of the food they ate. Today, Asian consumers are increasingly interested in the ‘story’ behind the food they eat, and will often pay a premium, basing purchasing decisions on provenance or production system.

Today’s e-traceability systems allow users to query the origin or details of recalled products in less than a minute. Consumers can now use their smartphones to scan product barcodes and instantly obtain product information. Traceability brings added benefits for producers and exporters in verifying the authenticity of high-value niche products such as organic or fair-trade produce- an increasingly important source of value-added in Asian agriculture. Authentication is therefore the key to building and sustaining value addition through facilitating product differentiation. Of course, companies recognize this, and major food exporters (such as Sime Darby in Malaysia, Betagro and Charoen Pokphand Group (CP Group) in Thailand, and etc.) already have their own traceability systems to provide key data to their customers, regulatory authorities and consumers. Critics say this trend primarily serves the needs of rich consumers in developed markets, and brings no benefit to poor consumers in these countries.

Worse, they may harm the interests of poor smallholder farmers in developing countries.

Implications: Looking ahead, we may point to some likely implications within the overall scenario we have described: •

•

•

Figure 1: Traceability along the food supply chain Source: www.fmric.or.jp/trace/en/handbook_traceability_en.pdf

Increasing food safety consciousness among ASEAN consumers will make food traceability schemes a universal requirement, and will be regarded by producers as a de facto price of market entry; New advances, innovations and combinations of enabling technologies will remove traditional obstacles to effective produce traceability across long and complex supply chains, driving more transparent and faster information exchange among supply chain actors; Ability to authenticate origin and production systems will boost farmer income by encouraging shifts in production from low-cost commodities to niche markets for valueadded premium produce with non-tangible attributes (e.g. ‘organic’, ‘fair-trade’ and ‘sustainable’ produce).

But externally-imposed requirements such as traceability carry implications for development too. So what are the implications in terms of development and poverty alleviation? How might mandatory traceability requirements affect the ability of small farmers to participate in regional/

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

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• • • •

will boost intra-regional trade, increasing the risks of food safety incidents, and their potential scale and impact Traceability as a means of risk mitigation by importers and wholesalers Technological innovations allow automatic data transfer at each transaction Multi-lingual capabilities of some traceability software overcome language barriers to adoption Independence from the standards themselves

Inhibitors: • Figure 2: Barcode types Source: http://www.product-category.com/picview.php?title=3d+ barcode&photo=http%3A%2F%2F www.xclusive.com.au%2Fazalea%2 Fss_all_barcodes.gif&source=http%3A%2F%2Frostacman.co.cc%2F3d-barcodes.html

global value chains? Individually lacking the resources, technical skills or capital to comply with traceability and certification requirements, traceability may not prove scale-neutral, and might hurt small farmers. Policymakers will need to consider the following possibilities in the context of poverty alleviation: •

• •

Increasing safety consciousness among consumers Increasing interest in value-added niche products (e.g. organic, fair-trade, sustainability).

Drivers & Inhibitors of adoption of traceability systems: Drivers: • •

• •

The burden of mandatory traceability requirements could exacerbate existing inequities through marginalizing smallholders and impeding their integration into regional and global value chains; The export orientation of traceability systems could lead to neglect of small farmers who predominantly supply local markets; Are there new ways of organizing small farmers to minimize costs, ease compliance burdens and help them participate in value-added production?

Early indicators of the need for traceability systems: • •

•

Smallholders still lack capacity to comply with stringent standards Smallholders lack capacity to provide data electronically to buyers Failure among countries to agree on inter-operability standards Lack of monitoring, analytical and enforcement capacity within relevant authorities, especially in responding rapidly to health alerts generated by traceability systems.

Growing food safety consciousness among regulators and consumers Global trade liberalization, and formation of AEC

Figure 3: RFID types Source: www.ibm.com/smarterplanet/us/en/embedded_systems/ article/product_traceability.html

About The AUTHORS: Chatta Udomwongsa is Chief Operating Officer of FXA Group Ltd, a leading provider of enterprise traceability solutions across multiple segments of the food industry. He can be reached at ChattaU@fxagroup.com.

Wyn Ellis is a Bangkok-based researcher and consultant in innovation and agricultural development, and serves as Chief Editor of TrendNovation Southeast. He can be reached at asiaag@truemail.co.th.

References www.boi.go.th/english/why/Food_Processing.pdf http://www.aseanfoodsafetynetwork.net http://ec.europa.eu/food/food/foodlaw/traceability/index_en.htm http://ec.europa.eu/food/food/foodlaw/traceability/factsheet_trace_2007_ en.pdf http://www.foodtraceability.eu/page/consumer-main http://www.foodsafetynews.com/2010/03/thailand-launches-food-traceability-initiative/ http://en.wikipedia.org/wiki/Radio-frequency_identification http://dl.alphaworks.ibm.com/technologies/theseos/RFID_Traceability.pdf http://www.ibm.com/smarterplanet/us/en/embedded_systems/article/ product_traceability.html

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

TRENDNOVATION SOUTHEAST NEWSLETTER

INTERVIEW with Dr. Henry Yeung

By Dr. Pun-Arj Chairatana,

Managing Director – Noviscape Consulting Group

Q: What will be the key emerging issues related to the socio-economic integration of Southeast Asia over the next decade?

Regional development is a major policy issue in East and Southeast Asia. From China’s Yangtze River Delta and Pearl River Delta, South Korea’s Seoul Metropolitan Area, and Taiwan’s Taipei–Hsinchu region, to Malaysia’s Penang and Selangor states and Thailand’s Greater Bangkok region, rapid industrialization and economic development are taking place at historically unprecedented rates on the back of high export propensities and, more recently, massive growth in domestic markets.

The role of state institutions during the past fifteen years has been particularly important in enhancing human resources and physical infrastructure in industrial districts and growth regions. Regional development can be viewed as a trans-

About Dr. Henry Yeung: Henry Wai-chung Yeung received his Ph.D. from the University of Manchester in 1995. He has been Professor of Economic Geography at the Department of Geography, National University of Singapore since July 2005. He was a recipient of the National University of Singapore Outstanding University Researcher Award (1998) and Outstanding Research Award (2008), the Institute of British Geographers Economic Geography Research Group Best Published Paper Award (1998), the Commonwealth Fellowship (2002), the Fulbright Foreign Research Award (2003), and the Rockefeller Foundation’s Team Residency in Bellagio (2005).

His research interests are broad, covering theories and the geography of transnational corporations, Asian firms and their overseas operations, and Chinese business networks in the Asia-Pacific region.

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regional dynamic process of growth, change and mobility, where multiple actors operate at a variety of geographical scales. The regional outcomes of this interaction are likely to be diverse and variable.

I think one key issue is related to increasing cross-border mobility of factor flows, e.g. capital and people. Borders within Southeast Asia remain quite visible and tightly controlled. A gradual loosening of this control will represent a major challenge to regional integration.

Another major issue will be the vast inequality within and among Southeast Asian countries. As this inequality widens in relation to globalization, I think ASEAN and the member states will find it very challenging to manage integration processes that may indeed worsen such inequality.

Q: Foreign Direct Investment (FDI) from multinational corporations (MNCs) in Southeast Asia has always been the most important bloodline for the region’s economic development and poverty reduction.

With the emergence of Chinese economic power, how will investment in the region be shaped by China, particularly in transportation, energy, and banking?

Southeast Asia’s development trajectory is not a straightforward pattern of the ‘new international division of labor’ or ‘a global supply chain’. It reflects a much more complicated pattern of strategic coupling that has occurred over the past fifteen years when manufacturing firms in the Asian newly industrialized economies began to emerge as strategic partners for global lead firms. This is particularly the case in China’s Yangtze River Delta and the Pearl River Delta. Exportoriented production platforms have been well established to serve global lead firms and their Asian strategic partners – mostly from Hong Kong, Singapore, Taiwan, and recently Vietnam – in such diverse industries as clothing, footwear, consumer products, electronics, and ICT. For example, in the electronics industry, Malaysia’s Penang has gained a strong foothold in the development of integrated computers and semiconductors manufacturing. Together with Singapore and Thailand, Penang is an integral part of the Southeast Asian ‘Golden Triangle’ that accounts for a massive majority of global hard disk drive (HDD) production.

In Thailand’s Greater Bangkok region (that includes Rayong and Samut Prakarn provinces along the eastern seaboard), global lead firms in two contrasting Gross National Product (GNPs) have found favorable production platforms for their regional and global markets: automobile and HDD indus-

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

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TRENDNOVATION SOUTHEAST NEWSLETTER

tries. In both industries, the Thai regions have successfully coupled with demand by global lead firms for low-cost and reliable production platforms. The Thai regions are also intimately woven into the complex regional production networks of these global lead firms and their major suppliers based in Singapore. These show how production platforms in Southeast Asian regions can be enrolled into the international partnership of another regional state (Singapore).

I believe greater mainland Chinese investment in ASEAN will provide more opportunities for economic development and job creation. In the manufacturing sector, Chinese FDI will likely enhance the industrial linkages between ASEAN firms and customers in China. It will strengthen trade relationships between ASEAN and China.

In the resource sector, however, Chinese FDI may lead to significant resource depletion and associated environmental problems. It needs to be configured and regulated carefully in order to avoid these wider issues.

Q: As an economic geographer, what is your scenario on the future of forthcoming ASEAN Economic Community (AEC) with special reference

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to poverty reduction and human resource mobilization for the next decade?

In the Southeast Asian context, the challenge of economic integration is much more complicated as local firms and authorities remain relatively weak in their organizational and technological capabilities. And yet, these regions face tremendous pressure from cost-based competition.

I think the AEC is clearly a good thing to have because it is likely to promote intra-ASEAN cooperation through crossborder flows of capital and people. This enhanced mobility in factor movement within ASEAN countries can create a greater sense of regional identity, as people become more aware of the political, social-cultural and economic environments in other ASEAN countries.

Whatever the chosen development trajectory and policy regime, one important lesson is that they are unlikely to be effective and sustainable without a fuller appreciation of the transregional dynamics in which the region is located. This is the key contribution of thinking of regionalization as necessarily situated in the competitive dynamics of the AEC.

Picture by PACEyes © 2011

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

TRENDNOVATION SOUTHEAST NEWSLETTER

TREND TOOLS Text Mining for Technology Foresight By Sadudee Vongkiattikachorn, Senior Consultant – Noviscape Consulting Group Text mining for technology foresight (“text mining”) is a form of “content analysis” with some variations.

It exploits text and numerical data source of various sorts, especially those related to “technology intelligence”. Such intelligence is the prime requirement for effective technology management as organizations operating in competitive and/or collaborative environments must track information on external technology developments. It underpins Future-oriented Technology Analysis (FTA), which encompasses key aspects of technology forecasting, assessment, foresight, and roadmap development.

About The author: MR. Sadudee Vongkiattikachorn Sadudee Vongkiattikachorn is a development economist with high level experience in policy research in a number of sectors. Mr. Sadudee holds a Master of Public Affairs (M.P.A.) degree from the School of Public and Environmental Affairs (SPEA), Indiana University, and a Bachelor of Economics (B.E.) degree from Thammasat University, Bangkok, majoring in monetary and international economics. In his most recent position as Senior Researcher at the Division of Policy Research and Development, Public Policy Development Office (PPDO), attached to the Prime Minister’s Office, Thailand, he authored a number of major policy research papers relating to economic, political and social development, poverty alleviation, and strengthening of Thailand’s research capabilities. He currently works with Noviscape Consulting Group as a senior consultant.

ISSUE 10 - NEW FACES OF ASEAN PART 1

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Therefore, text mining focuses on extraction of useful intelligence from electronic text sources, both publicly available and organization-confidential databases. The method serves FTA interests in three major ways: • • •

Identifying R&D emphases that facilitate the process of future developments; Providing time series for trend extrapolation and growth modeling; Determining “innovation indicators” that pertain to the prospects for successful technology applications.

Text mining is also considered to be closely related to more well-known methods, such as “technology monitoring”, “environmental scanning”, and “literature review”.

Embracing the concepts altogether, text mining should then be able to scan and digest a broad range of related literature sources as well as raw data and information in order to identify developmental patterns, key events, and significant changes in various environments.

Approach & Methodology In practice, the text mining is usually an 8-step process as follows: •

Step 1: Define key questions to be addressed: The questions must relate to management of technology issues. They will act as guidelines for people to make choices about which data sources to use and which analyses to pursue. This will lead to focus in data gathering and thus effectiveness in answering the questions.

•

Step 2: Obtain suitable data: Hundreds of available databases can be utilized to extract data to fulfill technical intelligence and research needs.

•

Step 3: Make the searches: The inquiries must be properly bounded from the beginning so that a “quick and raw” initial search can be made effectively. The abstract results of the search would then be put into the quick analysis in the next step.

•

Step 4: Import into text mining software: Initial search results could be imported into TechOASIS, text-mining software, for further particular analyses of field-structured text records.

•

Step 5: Clean the data: Data cleaning, also called “clumping”, is carried out to consolidate name variations from multiple databases. Relevant software tools would be helpful to the aggregating process.

•

Step 6: Analyze and interpret: Analyses in many paths and forms should help answer the essential questions driving the analysis. After the basic operations being done by text mining software, analyses and interpretations will then follow to allow some easier exploration. Also note that some of the other operations can also be done without text mining software, e.g. website database search engines.

•

Step 7: Communicate and present information:

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ISSUE 10 - NEW FACES OF ASEAN PART 1

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The prerequisite of this step is to know how the key users like to receive technical intelligence. Reporting styles may be combined in various ways, including oral and written, electronic and paper, text tables and figures (e.g. video or animations), and interactive exchange (e.g. workshop). Explanations should be directed to the audience with the utmost level of efficiency.

•

Step 8: Standardize and semi-automate: Rapid Technology Intelligence Process (RTIP) could be advocated in standardizing and automating text mining analyses. With the help of RTIP, technology managers and professionals become more familiar with the text mining outputs. Analyses can also be done much faster and cheaper as fewer resources are utilized to generate more value.

Application: Text mining certainly consists of strengths and weaknesses. The method is able to answer four types of questions: who, what, where, and when. On the other hand, the other types of questions, how and why, will almost always require the method blend with some expert opinion to infer processes (how?) and reasons (why?). This reflects the fact that the method, like all others, never stands well alone. For text mining, it also needs to be combined with other methods, particularly expert opinion. High involvement of substantive experts in the process is essential. Basic tabulations must come with thoughtful interpretation. Relevant “innovation indicators” require complementary expert opinion to test observations and relationships generated from the information resources. In sum, combining text mining results with expert opinion will allow strengths of each side to take into effect.

Nowadays, the text mining technique is admittedly new to technology managers and professionals as well as futurists. Hence, it is crucial that certain groundwork be laid out to prepare for its effective application. The todo list that could be considered to be carried out is as follows: •

Development of user-friendly database: putting information products into comfortable and easily grasped by users is pivotal. A number of R&D databases useful for technology foresight should be set up.

Blending numerical tabulations with graphical depictions and text interpretations should be done in a way that tailors to audience’s preferences. An interesting option is to merge a report with a CD containing the raw abstracts and the mining software. A highly recommended approach in tailoring information products cautiously to key users’ needs is to put findings into “packages” to avoid information overload.

•

Training workshops: training is certainly mandatory for text mining to be conducted effectively. Motivated analysts must obtain support via ongoing access to advice from experts. Furthermore, given some investments in certain application software, e.g. VantagePoint, development of in-house capabilities can be

Source: http://www.cc.gatech.edu/~agray/6240spr11/

carried out to enable internal people with their access to suitable electronic information resources, followed by implementation of tools to search, retrieve, and analyze selected records.

•

Building relationships: establishing strong relationships between analysts and users is one of the important required efforts to build familiarity with text mining outputs and use them effectively. Three factors exist to enhance the prospects: 1) facilitating direct links between the analysts and users; 2) engaging multiple analysts and multiple technology decision makers to develop a robust, learning network; and 3) directing attention to successes so that the organization appreciates the value gained.

In conclusion, text mining has a role to play in comparing and assessing the research outputs of various organizational groups. National foresight studies can exploit text mining to compare national R&D outputs with those of benchmark countries, or with their national economic development targets. The most promising outlook as a result of using the method includes the advance in the interpretable innovation indicators that benchmark technological progress and the advent of “macros” (Visual Basic scripts) that control sequences of steps in relevant text mining software.

References Porter, A. L. (2009) Tech Mining for Future-Oriented Technology Analyses. AC/UNU Millennium Project.

Disclaimer : The opinions expressed herein are those of the authors and do not necessarily reflect the official positions of Noviscape Consulting Group or the Rockefeller Foundation.

Copyright © Trendsoutheast 2009 - 2011. All Rights Reserved.

Prof. Marvin Beduya Mr. W Wyn Ellis Mr. Chatta Udomwongsa Dr. Henry Yeung Dr. Pun-Arj Chairatana Mr. Sadudee Vongkiattikachorn Writers / Information Specialists Preeda Chaiyanajit Nartrapee Wongseangchundr Project co-ordinator William Wyn Ellis Chief Editor Pinchathana Atthiwatthana Graphic Designer Regional Horizon / Environment Scanning (HS/ES) and trend monitoring for issues relevant to people, life, and regional transformation across the Southeast Asian region.

Trendnovation Southeast Newsletter is published by

Noviscape Consulting Group (NCG) www.noviscape.com

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