APCAC 2019: Review

Kurt Tong US Consul General at APCAC 2019.JPG
Pascale Fung, HKUST director of AI research.JPG
apcac 2019  janet de silva.JPG
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apcac 2019 opening.JPG
Photo gallery: US Consul General Kurt Tong; HKUST's director of AI research Pascale Fung; Janet de Silva, Toronto Board of Trade; AmCham China's Tim Stratford; delegates arrive on the opening morning
 

Facebook’s rise over 15 years from a freshman’s fantasy to the dominant social media platform on the planet is a subject ripe for discussion, and for debate.
 
Simon Milner, the company’s vice-president, public policy, for Asia-Pacific arrived at APCAC’s Business Summit 2019 last week ready to open up about the path the company is taking, looking forward, and the challenges it faces.
 
Miller said the positive impact Facebook was having was being felt mostly by small businesses across the region – and how they could now connect with new markets in America, and around the world.
 
“The thing about Facebook that’s particularly powerful is we have found a solution for smaller businesses,” Miller said. “If you’re a small business in Hanoi, there really aren’t any other platforms that can help you export.
 
“We’ve grown a whole new arena of advertising which is supporting hundreds of thousands of businesses across Asia.”
 
Miller was asked by host and AmCham Hong Kong president Tara Joseph to talk the audience through recent controversies over user data – an issue that remained at the forefront of discussion right across the summit’s two days, including Citigroup Asia CEO Francisco Aristeguieta’s keynote lunch address – The Future of US Trade and Investment in Asia.
 
“There is a shared challenge here,” said Miller. “There are big social issues associated with the internet and our services. We are a big part of most people’s experiences on the internet. Some of the issues are big and some of them are very new.”
 
This ever-evolving landscape was further explored across the two days of the summit.
 
US Ambassador to Indonesia Joseph R Donovan Jr has history in Hong Kong. He was Consul General from 2008 to 2009 and his return to the city Tuesday for the keynote address “The Importance of Asean in the Indo-Pacific Strategy” gave him pause for thought, given how rapidly Asia’s economy – and the world’s – has changed in the interim.
 
Donovan’s address tackled more traditional global economic and investment concerns – such as energy, where the “Indo-Pacific region will account for roughly 85 percent of the growth in net gas imports globally, requiring an estimated US$80 billion in liquefied natural gas (LNG) infrastructure investment in Asean and India alone,” and infrastructure, where, the ADB noted, trillions of dollars in investment are needed by 2030, and “only the US$70 trillion in private capital located in the world’s financial centers can meet these requirements.”
 
But there was considerable attention paid to the growth of the digital economy so far, and into the future, across both Asean and the wider Indo-Pacific region.
 
Donovan explained that the global digital economy was worth US$3.5 trillion in 2015, up from US$1.2 trillion in 2008, and that the “Digital Partnership” being promoted will establish public-private partnerships to build digital infrastructure; deploy technical assistance to support projects ranging from crafting ICT sector regulations to improving cyber incident response capabilities; and expand opportunities for US exports.
 
“We must ensure governments are not undermining this growth through unfair, protectionist measures, but rather serve as the champions of open platforms for innovation, the free flow of data, and other market-based measures that lift up all our economies,” he said.
 
Data issues were the primary focus of the Data Privacy and Cyber Security: Are We On the Right Track? panel
 
Panel member Daniel Warelis, Asia-Pacific head of government and regulatory affairs at Refinitiv, highlighted the “huge positives” a digital world provided in terms of financial inclusivity, and how positive these developments were in terms of small businesses being able to reach the global market.
 
The main threat, according to Anthony Scriffignano, senior vice-president and chief data scientist at Dun & Bradstreet, was that current legislation lags behind technology. “Some of the crimes being commited and the dangers don’t even have names yet,” he said.
 
Laurence Van Der Loo, director, technology and operations, Asia Securities Industry and Financial Markets Association, suggested “calibrating regulation across borders” was the answer.
 
American business should work with their partners across Asia in finding the right way to regulate and work with data, said Mr Scriffignano.
 
The future, he said, “can be dystopian or utopian. It’s up to us to pick.”

E pluribus unum...

Are the values that underpin the global trading and financial system, like bell-bottom pants, subject to the vagaries of fashion? Or have they done strutting the catwalk, now to be tossed into the ragbag of history?
 
These meaty questions were at the core of the Asia Pacific Council of American Chambers summit, hosted by AmCham HK at the Grand Hyatt Hotel.
 
First serve went to US Consul General Kurt Tong, who made a robust argument that the values-based system remained the best path to prosperity for all. In an opening speech peppered with trademark humor, Tong took the long view of America’s engagement in the region. In a welcome nod to AmCham’s 50th anniversary celebrations, Tong called on the audience of more than 200 top executives, diplomats and government officials from across the region and beyond, to take a stroll down memory lane to the era of those bell-bottom pants and humanity’s first steps on the Moon.
 
Back then, US trade with the Indo-Pacific region was virtually non-existent. In the decade that followed, commerce would soar more than tenfold. 
 
US trade partners 1970 - 2010
 
The narrative of US relations with Asia is peppered with fears over strategic and economic rivalry – first Japan, more recently China – and over America’s long-term decline.
 
Today, US trade with the Indo-Pacific stands at US$1.8 trillion. The US has treaty allies in the region, around 365,000 military personnel, and provides about half a billion dollars in military assistance. All of which aim to “build trusting relationships and build space, free seas and open pathways for economic cooperation,” Tong said. “It’s worth noting that Japan never really came close to challenging the United States.”
 
The US remains a Pacific power and committed to spreading economic prosperity, good governance and security. Tong pointed out that the infrastructure needs of the region’s development goals are far too vast for any one nation to fund. Mobilizing the US$70 trillion of private capital is going to be a vital part of that story, Tong said.
 

Can’t stop me know...

Next up, Pascale Fung, Director of the Center for Artificial Intelligence Research at the Hong Kong University of Science & Technology, who argued that the pace and momentum of technological change act against conflict and isolationism.
 
The world wants AI, the argument goes. AI needs big and open data sets. The two-way flow of research and investment is coupled with software codes and databases that are increasingly open. 
 
Research in the US and China shares the same DNA, she said, pointing to the long history of Chinese researchers who started out at American universities.
 
Now China’s economic growth has allowed it to focus more resources on areas such as AI and deep learning, in which American has enjoyed unrivaled superiority. While that is raising tensions between the two sides, neither can develop without the cooperation with the other. 
 
Fung also cautioned against national stereotyping, giving the example of the idea that China’s lack of ethical standards gave it an unfair advantage in research. But she said China’s leaders and regulators clearly understood that “If you don’t have ethical standards, you cannot have consumer trust”, describing a “coming crisis of confidence among consumers,” due in part to the ease at which fake news and other hoaxes are created and distributed thanks to new technologies.
 
Quotable:
 
 
OPENING PANEL I: THE FUTURE OF U.S.-CHINA TRADE: HOW DO BUSINESSES COPE?
EDWARD TSE
FOUNDER AND CEO OF GAO FENG ADVISORY COMPANY 
 
“People still have old stereotypes of China – that it’s just a handful of smart guys at the top telling everyone what to do. That’s really not the case anymore. Of course you still have the heavy hand from Beijing, but most of the innovation takes place at the grassroots.”
 
“The local government is the ‘glue’ which holds these two levels 9the Beijing government and the entrepreneurial level together). There is a three-layer system in China -- it is not so top-down as many people seem to think. And this is the difference between CHina and the Soviets.”
 
“Ten years ago, people talked about how stupid the Chinese were, how ‘copycat’ they were of other technologies. Today, at this forum, all I hear is about how China is the ‘new Asia’.” 
 
 
LINDA BROWN
CHIEF EXECUTIVE OFFICER AT LAUREATE INTERNATIONAL UNIVERSITIES
“I want every student to be an international student. Every student should be thinking globally. They need that muscle.” 
 
 
LEE HAWLEY
CHIEF HUMAN RESOURCES OFFICER AT GLP
“Start with the person, not the job. What kind of characteristics do I want in this company? Hire that then train and teach the rest.”
 
JON PENRICE
PRESIDENT, ASIA PACIFIC AT DOW CHEMICAL PACIFIC LTD
“We need smart people to work in smart manufacturing.”
Advice to manufacturers – go local. “You will be surprised by the capabilities of the local markets.”