A Paradigm Shift Toward an Open Platform Economy in Asia - Mobilizing AIIB Resources for Cross-Border Cooperation in the Region

Abstract

The Asian economy has been driven by competing exports to other regions for many decades, and cross-border coordination and cooperation within the region has been scarce. Meanwhile, a platform economy that hinges on multi-sided market is gaining traction where production factors come together to breed creative services and innovation within an intricately connected ecosystem. To establish a viable ecosystem, countries in the region should embrace the value of “openness and collaboration,” by nurturing an open-minded attitude, forming social and human capital, and expanding digital network in the region. Also, greater investment should be made in developing human resources, software, and coordinating legal framework and legacy regulation, in addition to educational and financial reforms. These challenges cannot be effectively met with existing institutions with a traditional bureaucratic governance structure. The newly established AIIB can play a pivotal role and a daunting task in engaging these forward-looking efforts and facilitate a new growth paradigm shift that fully utilizes the network effect in Asia. By way of mobilizing resources in regional, longer-term investment in the region, the AIIB can unleash a floodgate of new opportunities for Asian ICT and Fintech companies to build high-tech open platforms and create lucrative markets. This can be backed by the member country’s commitment to cleaning up legal and regulatory barriers and setting up competitive open API (Application Programming Interface) standards for more diverse and active transactions among potential participants in the expanded market.