APEC’s Most Talented App Developers Tackle Business Challenges at Trade Meeting

As trade ministers prepared to gather for the Asia-Pacific Economic Cooperation (APEC) trade meeting in Hanoi last week, a group of the region’s most talented developers were in a nearby room, competing in the first-ever APEC App Challenge. In the final hours of the competition, the room grew more intense as developers bent over their screens, coding furiously to put the final touches on their apps before the 24-hour deadline was up. 

Eleven developer teams from nine APEC economies were challenged to come up with innovative apps and online platforms to help micro, small, and medium sized enterprises (MSMEs) leverage the internet to gain access to foreign markets, to export, and expand their businesses to better contribute to local economies. Chris Gough and David Elliot, software developers from Australia, were awarded first place for their app, APEC Connect. The app employs blockchain technology—a type of distributed database technology with built-in cryptographic validation—to help MSMEs register a global export identity, grow their reputation as exporters, and access export-related standards and regulations.
 
An initiative of The Asia Foundation, the APEC Secretariat, the Ministry of Industry and Trade of Viet Nam (MOIT), and Google, the App Challenge highlighted the importance of MSMEs in Asia-Pacific economies and the role that the mobile internet plays in supporting their development.

Why were MSMEs the focus of the App Challenge? They represent over 97 percent of all enterprises in the APEC region and employ two-thirds of the region’s workforce. The internet has dramatically cut the costs of exporting for MSMEs, and entrepreneurs are accessing new markets, integrating with global value chains, and growing their businesses in ways that create jobs and stimulate local economies. However, many business owners still face significant challenges gaining access to new markets due to limited knowledge, partner networks, and access to finance. In Indonesia, for example, even though small and medium enterprises contribute nearly 60 percent of GDP and represent 97 percent of total employment, their share of total exports is only 16 percent. Indeed, Indonesia’s total exports are less than 2 percent of global trade in goods and services, pointing to the tremendous potential that expanding trade has for its economy. As Andrew Ure, Google’s head of Trade and Economic Affairs in the Asia Pacific, noted: “If we’re able to double the number of small businesses in the Asia Pacific that are exporting, it would add 35 million new jobs and $1.5 trillion in export sales to the region.”
 
The gap in MSMEs’ contribution to their national economies and exports is due to a number of complex, often overlapping, issues, such as: (1) understanding and complying with domestic and international standards and regulations, (2) accessing financial services, (3) managing logistics and supply chains, and (4) building partner networks (e.g., customers and suppliers) and gaining market intelligence.

Last week’s event focused attention on these particular barriers by requiring each team to develop a solution that addresses one or more of them. For example, the second-place winning team, one of three teams from Vietnam, developed a marketplace and matchmaking platform for local artisans, AirLaLa, while the third prize went to the Malaysian team who developed Connect, an app designed to help inexperienced small businesses share information and knowledge on trade issues via an online platform.
 
The App Challenge is one of many steps that the region must continue to take toward generating its own solutions to multi-layered challenges like MSME development. It highlights the wealth of creativity and entrepreneurship that the region possesses and underscores the importance of meaningful public-private partnerships. As Challenge winner Elliot observed, “The APEC App Challenge 2017 unlocked some truly innovative solutions from a group of very smart people; many solutions that wouldn’t have been pragmatic just a few years ago.” But he also remarked, “When it comes to delivering the benefits of globalization to all corners of society, it’s our governments and institutions that play a critical role.”

Benjamin Lokshin is a program officer for The Asia Foundation’s Technology Programs and Katherine Loh is a consultant and former Asia Foundation program officer. The views and opinions expressed here are those of the authors and not those of The Asia Foundation or its funder.