The massive cargo ship with the Vietnamese startup’s logo plastered across its side passed under San Francisco’s Golden Gate Bridge before reaching land on 20 December. 

VinFast’s rise has been rapid and it’s making leaps for the Southeast Asian nation. The company was formed in 2017 by Vietnam’s largest-conglomerate Vingroup, worth 428.4 trillion Vietnamese dong ($18 billion) as of 2021. VinFast is the first Vietnamese car maker to expand internationally and produce electric vehicles. 

VinFast’s CEO Le Thi Thu Thuy described the company as “Vingroup’s first global brand with a mission to bring the brand across borders,” in written communication with the Globe.  

“VinFast marks a significant step forward for the Vietnamese automotive industry,” she added. 

In Vietnam, the automaker is buoyed by the ubiquity of its parent company, close ties within government, and support from many Vietnamese buyers despite flaws in the product.

While the automaker’s push into the global market is groundbreaking, the company’s short history leaves experts puzzling over VinFast’s viability abroad. The enterprise has been marred by delays, erratic changes in personnel, billions of dollars in losses, and many see the vehicle as subpar compared to the competition.

Gregory Poling, director of the Southeast Asia Program at the Center for Strategic and International Studies, agreed with Thuy on the noteworthiness of VinFast’s expansion. 

“It shows Vietnam leap-frogging the value-added chain. … Vietnam would be the first and only Southeast Asian economy selling a domestic auto brand abroad with success,” he told the Globe but stated the car’s competitive viability is in question. 

“[But] nobody’s very impressed with driving the VinFast car. They’re not cheap enough to compete on cost and they’re not good enough to compete on quality.”

There’s high stakes for Vingroup’s EV arm. The financial stability of its parent company Vingroup and its chairman and founder – Vietnam’s richest man, Pham Nhat Vuong – are on shaky footing at home. 

Vingroup has enterprises in nearly every sector of the Vietnamese economy yet depends on its real-estate venture, Vinhomes, to bring in the cash. But the country’s property sector is in crisis. In an ongoing anti-corruption campaign, the government tightened laws on bond issuance spooking the market, developers are deep in debt, and the market for high-end housing is saturated. 

VinFast first moved into the international car market in July 2021, stating they’d open offices in North America and in Europe. On 29 March 2022, the company made another big announcement, it would start making vehicles in Pittsboro, North Carolina.

Along with concerns about the saleability of VinFast’s EV, the automaker is having major losses. From 2021 to 2022, VinFast lost $2.4 billion. Further, in March the company postponed the founding of its first overseas auto plant in the U.S. state of North Carolina from a July 2024 commission to an unspecified time in 2025. That’s just the latest in a spate of setbacks. 

In February, the company announced there would be delays on the delivery of its first cars to American customers and cut 80 jobs in North America – eliminating its Canadian division. There were more staff changes in March, with three US-based executives leaving the company. The leadership at the top of the company has also been unsteady, with three CEOs in the last five years. 

“VinFast focuses on leanness and flexibility to adapt quickly to the fast-paced development of the electric vehicle industry,” Thuy stated in response to the personnel shifts.

Vuong’s mammoth enterprise could be near collapse, Alexander Vuving, professor at the Asia Pacific Center for Security Studies in Hawaii, told the Globe.

“[Vuong] has built an empire where you have Vin-everything… electronics, electric cars, education, health, and everything else but the only portfolio that has produced profit for him, it’s really been real estate,” Vuving said. 

“He is now putting all of his bets on electric cars but it is not going to bring him profit for many many years.” 

Five-year-old VinFast was quick to get up and running. After the project was launched in 2017, the company built a sprawling 335-hectare auto-plant on northern Cat Hai island. By 2020, VinFast was the country’s fifth-best-selling car. 

Although Cuong Hoang Chan, an owner of a VinFast e34 in Ho Chi Minh City, noted some errors in the car’s software, he is happy with the vehicle. He mentioned “minor errors in software” including sensors showing warning signs when changing lanes at high speeds despite the car operating normally. Still, he said customer service and charging stations are easily accessible, the company makes frequent software updates, and is excited to see the company’s expansion. 

“Expanding business in the U.S. is the right step,” he said. “If you can sell a car in the U.S., you can sell it around the world. … This is just the beginning.”

The VF8, the only current model available in the U.S., was made available to customers in Vietnam in September 2022. Stalling batteries, software issues, and temperature controls have plagued the Vietnam roll out, according to a Rest of World report. 

Do Son in Hanoi owns two VinFast EVs – an e34 and the newer VF8. He said the VF8 has similar issues to what the e34 had a year ago but is happy with his vehicles and customer care when issues occur. 

“As an electric car fanatic like me, Vinfast is a company that helps me realise my dream of owning an electric car in Vietnam,” Do Son told the Globe. 

Not everyone is as bullish on VinFast’s future success or the conglomerate’s broader prospects. 

Bill Russo, head of Shanghai-based consultancy Automobility Ltd and a former Chrysler executive, said there will be a tough path ahead for the EV startup.

For Russo, VinFast’s push into the U.S. market showcases the company’s drive to tap into a large demand market. 

Although this allows the company greater opportunities to scale up, he noted some potential obstacles: the initiative is highly capital intensive, VinFast has near-zero brand recognition abroad and EV giant Tesla already controls the majority of the market. As of 2022, Tesla held 68% of U.S. sales. 

“Failure is always possible,” Russo told the Globe. “If you’re going to get a high-risk business like this to run, it’s going to be a pretty scary ride.”

VinFast’s leading option would be to offer the best value proposition, Russo explained, but Tesla is pushing down prices, making it more difficult for VinFast to provide the bargain option. Tesla has slashed prices twice this year, with higher-end models dropping by $29,000. 

Prices for the VF8 start at $49,000 compared to the cost of an entry-level Tesla at $42,990.

VinFast CEO Thuy listed high-quality products, good pricing, and “outstanding after-sales” as the VF8’s offerings to U.S. customers. 

But just 45 cars have been sold in the U.S. so far with its first California-based customers getting the vehicle on 23 March. The VF8 model is currently the only option in the U.S. and the U.S.’s Environmental Protection Agency found the vehicle’s battery range was about 80 miles less than what the company advertised. VinFast planned to offer two options for the VF8 battery. Customers could pay a higher price for the car battery included or lease the battery to cut costs. The company increased leasing prices on multiple occasions and the subscription is currently unavailable.

Some who have tested the VF8 have been frustrated by its quality and with VinFast’s wishy-washy roll-out. 

EV tester Kyle Conner posted a YouTube review of the vehicle in January.

In the video with more than 6,000 likes, Conner compliments the design but complains of what he found to be inconsistent power, voice commands which are impossible to turn off, slow charging speeds, and wrote on the comment of his video that “the noise on the highway is nearly unbearable.” The YouTuber also described an extravagant marketing campaign that for him, failed to live up to the hype.

“If VinFast put half the amount of money into engineering instead of the crazy marketing they’re doing, they may have a desirable product,” he stated. “What you would spend on this car actually makes no sense.” 

Some in the U.S. are more positive. Living about a 10-minute drive from VinFast’s future plant in the town of Pittsboro, North Carolina, resident Kyle Mullaney hopes the factory can bring more opportunities to the community. Still, he’d also heard some negative comments on the car’s quality, cost, and some are frustrated by being priced out of their neighbourhood as Pittsboro develops. Five businesses, 27 homes, and a church built in 1888 are set to be cleared to accommodate the factory. 

“One of the big things that really excites me is just the possibility that Pittsboro is going to get new businesses, new job opportunities for folks,” Mullaney told the Globe. “The problem is, the pricing that we’ve seen is not very competitive … and there’s questions about the quality.”

With only 45 of the 999 vehicles which were shipped to the US delivered to customers and a shaky value proposition, VinFast losses are likely going to continue, burdening Vingroup. 

“It is a high cash-burn proposition for Chairman Vuong,” Russo said. “The question is, does the brand have any particular value proposition to markets like the US – and the answer is no.”

Vietnam-watcher Poling said the company’s brand power and government support give VinFast and Vingroup enterprises more broadly a leg up in Vietnam, but the burgeoning efforts overseas are shaky without that cushion. 

“Vingroup is used to operate in an environment where it is a national champion and is too big to fail,” Poling said. “Outside of Vietnam, they don’t have any of those protections.”

Before there was Vin-everything, Vuong’s ambitions began in eastern Europe. 

Prior to the fall of the Soviet Union, Vuong and other high-achieving Vietnamese students received scholarships to study in Soviet-bloc countries. 

After studying in Russia, Vuong moved to Ukraine where he began a range of businesses marking his biggest success in instant noodle production.

In 2000, Vuong turned his ambitions back to Vietnam seeing opportunities in real estate after the passage of the Law on Private Enterprises began to allow non-state businesses to thrive and on the advice from knowledgeable and government sources. 

“At that time, he saw a big opportunity for our real estate,” said Vietnam-born Vuving who also received a scholarship to study in Europe in the same period as Vuong.

The land was turned into the first Vincom Center, a shopping mall that now has more than 250 locations across the country. With Vuong’s efforts, the conglomerate kept ballooning. In 2010 he was focused solely on his Vietnamese enterprises after selling his Ukraine operations to Nestle for $150 million. 

The conglomerate’s projects now mark the country from north to south, where Vietnam’s tallest skyscraper – Vingroup’s Landmark 81 – towers over the rest of Ho Chi Minh City’s skyline. 

But on home turf, it’s been a tough couple of years for Vingroup.

The Covid-19 pandemic disrupted the flow of cash into Vingroup’s tourism complexes, Vuving said, and the country’s real estate industry has taken a nosedive starting last year when the government issued a crackdown on bond issuance.

Now, many companies are struggling to repay debts and 235 property firms went out of business in the first two months of 2023. 

Xavier Jean, senior director at financial analytics firm S&P Global, told the Globe that Vietnam’s property market isn’t likely to improve anytime soon. There was a boom in the real estate sector for high-end apartments, but now the market is oversaturated causing supply and demand to tilt out of balance. 

“Developers continue to be massively leveraged entities with chronic liquidity problems,” Jean said from his Singapore office. “Things are going to get worse before they get better.”

In what some see as Vingroup’s need for an influx of capital, Singaporean real estate giant CapitaLand is in negotiations to acquire $1.5 billion in Vinhome’s assets, Reuters reported on 20 March. 

Vingroup is also in talks to sell assets of its shopping mall enterprise to Thailand’s Central Group and other companies, Reuters reported on 30 March. 

Tyler Manh Dung Nguyen, vice president of institutional equity sales at Maybank Investment Banking Group in Ho Chi Minh City said Vingroup’s looming asset sale could be going to support initiatives including VinFast. 

“I think that it’s actually quite logical in order to sell some of their assets to be able to raise cash and fund their other activities,” he told the Globe of the Capitaland negotiations. “They need the capital to build the [VinFast] plant, they need the capital to fund their projects.” 

Vuving also sees an insecure future for the company, with the potential Capitaland deal a foreboding signal. 

“This means Vingroup is in dire straits,” Vuving said of the CapitaLand negotiations.

“There are also rumours about [Vuong’s] company’s sort of collapse, just having no money. … I think that’s very close to the truth.”

Still, Vuving noted that Vingroup has widespread support in Vietnam at the highest levels. If the company is truly crashing, Vuong’s allies may come to the company’s rescue. 

However, in July 2022, there were rumours that Vuong could be on the chopping block of the country’s anti-graft campaign although no official actions against Vuong were taken. In Vietnam’s current corruption crackdown, which led to the surprise downfall of the country’s president in January, it seems anything is possible. 

“Within the Vietnamese Communist Party, there are factions, there are networks, there are people who are fighting each other. But as far as I know, [Vuong] has a very good relationship with all of them,” he said. 

“If his company falls into a financial crisis, his friends in the government will try to use government instruments to help him… It’s still a gamble. They may sacrifice you, they may not.”

The post Too big to fail? Vingroup faces headwinds at home and abroad appeared first on Southeast Asia Globe.

One key area for this was in trade and logistics. The UN Conference on Trade and Development (UNCTAD) reported an increasing trend of import demand for manufactured consumer goods in 2020. 

This number has almost doubled in the past decade and has resulted in an increasing number of shipping containers in sea ports and lines of trucks across border crossings. While delays and blockages of container traffic were well-documented at the time, many institutions learned key lessons from this experience.

Both the E.U. and ASEAN should now chart pathways for digital trade facilitation reform that enables greater trade connectivity between the two regions. Together, the blocs are home to 1.1 billion people and in 2022 were each other’s third largest trading partner after China and the U.S.

To do this, countries around the world are already turning to digital transformation to tackle systemic trade barriers by maximising the use of technology in simplifying trade procedures and automating where possible.

Among several approaches aimed at modernising trade facilitation, one proposal that frequently dominates the digital trade facilitation agenda is the implementation and use of a Single Window system.

Single Window systems create a “one-stop-shop” approach to streamline import and export procedures by funnelling documents and other data through just a single, standardised contact point, rather than multiple offices. 

These systems are already in use, but can be further improved through digitalisation. Such upgrades will help boost regional, cross-border paperless trade efficiency and competitiveness for economic growth, incentivising trade partners to become more deeply involved in global value chains.

Single Window has already helped ASEAN countries expedite cargo clearance and reduce paperwork.

Bloc leaders agreed to form the ASEAN Single Window (ASW) in 2003 to enable the electronic exchange of trade-related documents across borders and expedite cargo clearance. Today, it is a regional initiative that connects National Single Window (NSW) systems in bloc member-states with the aim of promoting economic integration.

At the national level, Indonesia, Malaysia, Singapore, Thailand and Vietnam were among the first to implement Single Window within their national jurisdiction. They integrated the ASW in 2015, and the remaining member-states joined in 2019.

So far, it is highly relevant in handling the growing share of bilateral trade, which increased from 30-37% of total ASEAN trade from 2004-2018. 

These increases in trade flows mean that companies and government bodies dealing with import/export procedures have to deal with larger volumes of paperwork. The extensive paper-based requirements, combined with their slow and complex procedures, traditionally have lent a serious burden to cross-border trade. This is where Single Window shows its value.

While ASEAN has already implemented a bloc-wide system, the E.U. is still working on the formulation of its own Single Window for customs. The European bloc on 24 October recently enacted new regulation establishing the necessary framework for digital cooperation between customs and other authorities within the region.

The regulation aims for a nine year period for the single customs system to go live by 2031. However, this might take longer than the targeted deadline.

This effort to establish the system began in 2008 with the enactment of the e-Customs Decision mandating the Commission and the member states to establish such a framework.

Despite being relatively new for the E.U., the Single Window should open opportunities for further exchange of more trade-related documents in the future within the bloc and beyond, including with trade partners such as those in ASEAN.

The two blocs marked 45 years of cooperation between two advanced regional blocs on 14 December at the ASEAN-E.U. Commemorative Summit in Brussels. There, the blocs made major commitments to strengthen economic cooperation and trade, aiming to promote “peaceful, secure, open, interoperable, reliable, inclusive and resilient digital economies.”

However, it seems that both the E.U. and ASEAN overlooked the importance of developing technical yet practical cooperation in trade facilitation efforts.

The blocs’ Joint Statement agreed on sustainable connectivity as part of the E.U. Global Gateway support. However, the key actions planned to address both digital and trade connectivity barely address the urgency of facilitation in connecting two regions.

Digital Trade Facilitation through Single Window

As the E.U. works on formulating their own Single Window, they can learn some lessons from ASEAN. 

Although the E.U. Single Window only covers customs-related documents, it remains a breakthrough with potential of expansion in the future. Every minute, more than 600 customs declarations are processed around the E.U. by more than 70,000 customs officials working in the different member states.

They not only collect customs duties and value-added tax (VAT), but are also in charge of ensuring the products entering the E.U. Single Market are safe and secure, complying with health, environmental and other standards.

The time and financial cost needed for trade could be drastically decreased with the digital transformation of custom and trade procedures. Acceleration of trade digitalisation could mitigate the consequences of Covid-19 and further harness the recovery process beyond the current crisis.

The pandemic has helped drive a faster digital transformation and underscored the importance of paperless trade, including through Single Window. This transition is likely to be a protracted and challenging process that will require tight cooperation across nations. 

Nevertheless, digital transformation has become more essential for trade facilitation in the post-pandemic world. 

The critical importance of the Single Window is here to stay.

Pingkan Audrine is a research fellow in the connectivity cluster at the EANGAGE Project. Her research interests include international trade, digital economy, data protection and cybersecurity-related policy and issues.

The content of this article and the opinions expressed in this article are solely the author’s, and do not reflect the opinion of the EANGAGE Project, its partner organisations (Konrad-Adenauer-Stiftung, the Diplomatic Academy of Vietnam and the Asian Vision Institute) or the European Union (EU) and the Association of Southeast Asian Nations (ASEAN).

This article was supported by the “Think Next, Act Next – The Next Gen EU-ASEAN Dialogue” (EANGAGE) Project funded by the European Union and the Konrad-Adenauer-Stfitung. EANGAGE is designed to nurture the next generation of researchers and thought leaders in Southeast Asia and promote better awareness of the EU’s foreign policy objectives and the EU’s engagement in the ASEAN region.

The post Digital transformation is crucial for better trade in the post-pandemic world appeared first on Southeast Asia Globe.

That same cooperative spirit was central to the December 2022 E.U. – ASEAN commemorative summit in Brussels, where leaders from the blocs touched on deepening partnerships across technical fields. To the public knowledge, space-related research was not on the agenda – but perhaps it should be in the future.

A more structured approach to mutual exploration of this ‘final frontier’ would represent a key opportunity for partnerships across the regions, supporting human connectivity, knowledge transfer, business collaborations, and increased mutual understanding between the E.U. and ASEAN. 

At present, collaboration on space research is happening on a case-by-case basis. Countries that are interested in forging partnerships between bloc members must create their own channels to do so. There is no comprehensive platform to facilitate this, making it complicated for less-developed countries. The creation of a top-down approach, as through a joint space agency, would boost cooperation between ASEAN and the E.U., enabling diverse partnerships between public and private entities.

The creation of international collaborative groups between E.U. and ASEAN would be a good starting point to enhance ties between the two regions through scientific collaboration and data exchange. Examples of collaborative groups are the China-led Asia-Pacific Space Cooperation Organization (APSCO) and the UN Office for Outer Space Affairs. 

This move could later lead to a so-called space bloc, first in ASEAN and then in partnership with the E.U. Space blocs are multinational ventures grouping several countries interested in enhancing their skills and presence in space. Examples of this level of organisation already exist and include the African Space Agency, the Latin American and Caribbean Space Agency and the Arab Space Coordination Group. 

The space race of the Cold War framed exploration as a competition between superpowers, the U.S. and the U.S.S.R. However, over the decades, the paradigm has shifted toward a more collaborative model based on scientific discovery. 

Today, the International Space Station, launched in 1998 through partnership between the U.S., Russia, Japan, Canada and Europe, is an iconic example of space projects serving as a friendly zone for cooperation.

This new ecosystem provides a new horizon for innovation through what the Italian Space Agency has called a “cross-fertilisation of terrestrial technologies with space technologies”.

The entry of more diverse actors, especially those in the private sector, has birthed a growing “space economy” that may be divided between two categories: Space-for-space and space-for-earth. In the former, the services produced are re-used for space, while in the latter they are applied on earth.  

Governments in Southeast Asia are increasingly interested in employing space-for-earth technologie, such as earth monitoring, for deforestation, security and weather forecasting, due to their ability to bring benefits in the short run, such as data collection, monitoring and communications.

Some ASEAN countries are already making forays into space, whether on their own or in partnerships with states beyond the bloc.

In 2020, the Thai government declared its aspirations to launch lunar and deep space missions, citing economic and scientific development as key goals. Though the news was met by the Thai public with a mixture of interest and disbelief, the state announced its emerging Thai Space Consortium to be specifically focused on science experiments, boosting local know-how in applications such as space weather physics.

More broadly, ASEAN states have forged bilateral partnerships to increase their reach into space, some of which have facilitated the creation of new orbital satellites. 

Vietnam and India are currently joined in a Framework Agreement for the Exploration of Outer Space for Peaceful Purposes. Since 2006, Vietnam has developed the satellites PicoDragon as well as LOTUSat-1 and LOTUSat-2, both of the latter were built in collaboration with Japan. 

Meanwhile, Indonesia has produced the LAPAN-Tubsat, also known as LAPAN-A1, which was built in Germany. Indonesia has also engaged in collaborations with the U.S. and France for projects related to agricultural development, forestry monitoring and flood monitoring. Malaysia has also produced a satellite, working in collaboration with the UK, as well as remote sensing projects with the support of South Korea.

Besides its lunar aspirations, Thailand has a long history of collaboration related to space projects. Specifically, the Kingdom is one of the founding members of the APSCO and has signed an MOU in 1998 on the Cooperation in Small Multi-Mission Satellite (SMMS) project with China, Iran, Republic of Korea, Mongolia and Pakistan. 

These partnerships run in tandem with a long-standing strategy of cooperation with space powers such as the U.S., Japan and South Korea. The Thaicom-4 (iPStar) satellite, built in partnership with the U.S., currently represents the economic boon that such partnerships can provide. Launched to provide broadband services for the Asia-Pacific region, Thaicom-4 was able to record a net profit of more than $61,274,520 (2 billion baht) for its owner company, Thaicom Public Company Limited by 2015.

These leaps into the void could be just the first of a much deeper journey.

Existing space technology with great potential for Southeast Asia include satellite constellations such as Starlink, which could be an important tool for improving connectivity in rural areas or in other locations where establishing a mobile network infrastructure would not be economically feasible. Besides helping to address the “digital divide” between such areas and their urban counterparts, increased digital connectivity could also help to actualise the concept of smart cities. This tech-infused approach to urban planning is already of great interest in densely populated regions of Southeast Asia, and is likely to only grow more significant with time. 

Just in recent months, the Philippines announced plans to open up to Starlink – possibly the first country in ASEAN to do so – while the Cambodian government is making studies of its own on how access to satellite constellations might be useful.

Satellite imagery and monitoring can represent a change maker for planning as a whole, from points as granular as fine-tuning urban waste management to those as large-scale as curbing carbon emissions and deforestation. Satellite monitoring can also be a vital tool in tracking weather to the point of quickly alerting publics to potentially disastrous natural events. Such applications could save lives in a region prone to extreme weather and other phenomena.

The Philippines already shows us the benefit of having this kind of data in the event of natural disaster. In 2013 as Typhoon Haiyan – known in the Philippines as Super Typhoon Yolanda – bore down on the island nation, satellites were used to enhance awareness and preparedness, for example through data collection and analysis to understand and predict possible natural disasters. Diwata satellites, built in collaboration with Japanese universities, deployed for data collection and enhancement of collaboration between Japan and the Philippines.

ASEAN members are not unfamiliar with major collaborations, and neither are the European Space Agency (ESA) and the different national agencies of EU members. But a more institutionalised international collaborative group between the regional blocs –  leading to a macro space bloc following the example of ESA – could represent a powerful focal point for enhancing collaboration between the two regions, leveraging on science, knowledge and data sharing.

Riccardo Corrado is assistant professor and chair of the ICT program at the American University of Phnom Penh.

The content of this article and the opinions expressed in this article are solely the author’s, and do not reflect the opinion of the EANGAGE Project, its partner organisations (Konrad-Adenauer-Stiftung, the Diplomatic Academy of Vietnam and the Asian Vision Institute) or the European Union (EU) and the Association of Southeast Asian Nations (ASEAN). 

This article was supported by the “Think Next, Act Next – The Next Gen EU-ASEAN Dialogue” (EANGAGE) Project funded by the European Union and the Konrad-Adenauer-Stfitung. EANGAGE is designed to nurture the next generation of researchers and thought leaders in Southeast Asia and promote better awareness of the EU’s foreign policy objectives and the EU’s engagement in the ASEAN region.

The post Space Economy: an opportunity for E.U.-ASEAN collaboration? appeared first on Southeast Asia Globe.

With product prices ranging from $15-$85, she is making significantly more money than most Phnom Penh citizens’ average monthly income of $290. Within months of opening up shop, she was able to leave behind her former job as a real estate agent. But unlike most black market merchants, for Miho, it is about much more than money.

“I don’t know a lot about feminism,” she said, “But I know that women should have access to freedom…Making sex toys illegal takes away freedom from women.”

While sex toys have become more accepted around the world and grown into an industry worth tens of billions of dollars, in Cambodia, this market remains unlawful. But sex toys have become more popular among the newer generations of Cambodians and black market shops have popped up to supply growing demand. 

Making sex toys illegal takes away freedom from women”

Miho, sex toy entrepreneur

Miho, one of these sex toy dealers, gave an inside look into her business. Contrasting stereotypical perceptions about types of people involved in Southeast Asia’s black markets, Miho is a young, bubbly Khmer woman. With a diverse online catalogue of different types of sex toys, as well as thousands of followers on her social media, she is one of the more prominent dealers operating in Phnom Penh today.

While Cambodian law does not overtly ban sex toys in legislation, they are generally prosecuted under Chapter 5 of the Law on Suppression of Human Trafficking and Sexual Exploitation, which bans the distribution of pornography.

Human rights groups also say the laws are unclear and unhelpful.

According to Chak Sopheap, executive director of the Cambodian Center for Human Rights, the definition of pornography under the law is vague, allowing the government to legally prosecute a broad range of behaviors of which they disapprove, particularly activities that ‘affect Khmer culture.’

“Unfortunately, the government has on several occasions used the justification of the necessity to ‘preserve Khmer culture’ or ‘the values of dignity of Cambodian women’ to control women’s behaviour,” she explained.

Despite this illegality, the sex toy market is growing in Cambodia. A new group of social media savvy entrepreneurs like Miho are finding new ways to heat up the sex toy industry anyway.

The industry mostly operates on social media. While there are no official estimates on the prevalence of the trade, there are many sellers on social media marketing the products to countless netizens. Some LGBTQ+ youth in Phnom Penh also report that it is not uncommon to receive marketing messages over LGBTQ+ oriented dating apps touting the products.

In 2020, Miho bought sex toys for herself from China, and posted about her experiences on social media. She said that when she started receiving a lot of comments and questions from her followers, she soon realised that there was a huge interest in these products despite them being a major taboo for women in Khmer culture.

While there are ways of acquiring sex toys in Cambodia, mostly by importing them directly from foreign countries, many find the process intimidating. Although there are several websites and Facebook pages purporting to sell sex toys, they rarely have information in the Khmer language and many appear to be scams.

Miho believes that Cambodians need to trust both sellers and their products. That’s why her online store features practical demonstrations and explanations in Khmer.

But the trust Miho talks about is not only limited to her role as a sex-toy seller. 

Many people who contact her seem less interested in the products, but instead are more eager to have conversations with a sex-positive woman. Some have never been able to talk to anyone about their sexuality. She regularly receives life stories from her customers. 

These stories, Miho added, are often painful. 

One 40-something-year old woman confided in her that for the last decade she had never received sexual pleasure from her husband, but contracted STDs from him after he slept with other women.

Several younger women and teenagers have told her that they were sexually harassed by their relatives, but were too ashamed to tell anybody about it until they saw her online store.

“They just need someone to talk to,” Miho said, estimating that she receives over 100 messages a day, about 70% of which come from women. Responding to all of them has become almost a full-time job. When women open up about their experiences to her, they are going against what has long been considered the ideal way for women to behave in Khmer culture.

When women open up about their experiences to her, they are resisting what has long been considered the ideal way for women to behave in Khmer culture.

A list of rules for Khmer women, known as “Chbab Srey,” has been handed down in the form of a poem attributed to King Ang Duong in the 19th century. There is disagreement about from whom and when the list actually originated.

Studying the Chbab Srey was mandatory in schools across Cambodia until 2007, and they still have huge significance in the national culture.

“Do not bring external problems into the home. Do not take internal problems out of the home,” reads one of the poem’s rules for women. This cultural norm leads many Cambodian women to feel that it is wrong for them to be vocal about their problems, according to Miho. She said that many women were nervous when they first started talking to her, but she tries to make them feel more comfortable.

But while younger Cambodians are largely enthusiastic about her work, Miho said she has seen hostility from older generations.

“You’re ruining Cambodian women,” Miho paraphrased a response she saw online. “Trying to make them more like Europeans.” 

But this criticism is nonsense, according to Catherine Harry, a Cambodian feminist activist and sex educator who was featured in Forbes’s 2018 “30 under 30 Asia” list for her work in breaking down taboos around sex.

“If you really think about it, ancient Khmer culture was heavily influenced by Hindi culture. We can’t forget the Kama Sutra when talking about sex and Hindi culture,” Harry said. “I have yet to see any reliable sources from historians that prove that Cambodian culture explicitly banned sex toys. I believe a part of it can be traced back to the French colonial times.”

In her view, much of what conservative Cambodians refer to as authentic or ideal Khmer culture was actually introduced by the French and their Christian-influenced views on sexuality.

As an example, she mentioned the country’s famous Apsara dancers, who used to perform topless, but now wear a white shirt under their jewellery.

Today, some who have taken Apsara inspired topless pictures at the Angkor temples have been investigated and even prosecuted by the Apsara Authority for disrespecting traditional Cambodian values. Harry refers to this phenomenon as “Colonial Amnesia.”

She also dismissed a commonly cited concern that public display of sex toys and other things considered pornography could increase men’s libido to the point that they committed rape. She rather thinks it is a matter of ‘male fragility.’

“I have seen many instances where men feel emasculated by their partners using sex toys because they feel insecure and they feel like they’ve been rendered obsolete,” Harry said. 

Whatever the reasons, the products remain illegal, and sex toy dealers run a risk of being prosecuted and publicly shamed. As such, Miho has a system for keeping her business underground.

Her store is entirely online, but she makes a point to not advertise on Facebook, instead preferring to use social media platforms which lean more heavily towards younger users, such as Tiktok and Instagram.

“They will decide to arrest you based on the judgement of the public,” Miho said, explaining that she does not believe the police would intervene unless enough people demanded ‘justice.’ 

Her products are all imported by land from abroad, but the specific details of this are a trade secret. Once they have been picked up, they are stored in a specially rented flat in Phnom Penh. When a customer places an order, it is delivered to them discreetly in a pink paper bag complete with a thank you note. 

With no face to face contact involved, the process is quite straightforward and the business is able to operate with few staff. While business is already booming, she hopes to expand her reach and encourage more Cambodians to explore their sexuality without shame. She even dreams of inventing her own sex toy.

Although the limited size of her operation keeps her safe, there is always a risk that police could crackdown on her.

“If I ever got arrested, I would change something about this country,” she said. “I would win the hearts of the public.” 

*names have been changed to protect sources’ identities

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As a base to grow their startup Potent, focused on producing mushroom gummies, syrups and extracts, Nicholas and his business partners chose Thailand rather than his native England. 

“Thailand is a place that is very attractive to set up a business,” Nicholas said. “But it doesn’t have a reputation for being easy to set up a business in.” 

Thailand’s economy has historically relied more on manufacturing and agriculture than research and development. Singapore and Jakarta are normally considered Southeast Asia’s primary candidates for global investors, but the National Innovation Agency (NIA) operated by the Thai Ministry of Science and Technology is determined to change that.

Led by the NIA, Thailand is developing a series of ‘innovation hubs’ in Bangkok, Chiang Mai and other major cities, clustering universities, startups and leading companies in special districts prioritising key areas of development such as the medical and financial technology sectors.

The Kingdom is in the midst of a long-term effort to stimulate innovation and attract more foreign entrepreneurs, foster homegrown talent and advance technological development. The new framework includes a special visa programme, possible tax incentives for foreign investors and incubation and acceleration initiatives to help startups like Potent.

Thailand ranks 43rd out of 132 economies on the 2021 Global Innovation Index compiled by the European Institute of Business Administration. The NIA hopes to advance its position, and also move Bangkok from 73rd to a ranking in the top 50 cities in the Global Startup Ecosystem Index published by research centre Startup Blink.

“We like to transform those areas and to make them into innovation hubs in the cities – not in the outskirts of the cities, but in the downtown,” NIA Executive Director Pun-arj Chairatana said.

The innovation hub concept is aligned with the government’s ambitious Thailand 4.0 development plan, geared to advance innovation to improve social well-being and elevate Thailand’s economy, which the World Bank classified as “upper middle income.” 

Nicholas felt confident building his business in Thailand after being accepted into NIA’s Space F initiative, an accelerator and incubator programme designed to mentor and support early-stage businesses and entrepreneurs searching for technological solutions to food-related challenges. 

Now in its third year, Space F has seeded dozens of food-tech startups by connecting them with Thai venture capitalists and the research laboratories of top universities. Programme participants retain the intellectual property of their research and development. 

For foreign entrepreneurs like Nicholas, the key benefit of an innovation hub thus far has been government-assisted access to investors, regulators and industry advisors who can streamline the process of starting a business in Thailand.

“We now have the information we need to set up in a way that is going to be effective for us,” Nicholas said. “And that is how we’ve grown, because we have access to quality information and the right people.”

Bangkok has long been a tourist centre and the city’s major real estate developers have generally invested in hotels, restaurants and commercial businesses. But the NIA urged developers to work with the agency to promote key sectors in the national interest, Chairatana said.

“We convinced all the biggest land developers in Bangkok to think about how they can balance between the so-called purely commercial things and how they can contribute to the district and long-term engagement with not only universities but also small startups and the local community,” he said.

NIA’s innovation hubs are planned as physical districts enabling entrepreneurs to cluster with universities, government institutions and leading private sector companies. Space F is situated inside Mahidol University within Bangkok’s medical innovation hub, down the street from the NIA office and the Ministry of Foreign Affairs.

Foreigner entrepreneurs also qualify for a special Smart visa programme exempting them from a work permit requiring employment with an existing business. Their proposal must meet the criteria for innovation startups in target areas including Smart electronics, biofuels and “food for the future.”

Recent Space F graduate Vanessa Techapichetvanich is the CEO and co-founder of Jamulogy, a Thai-based company developing Jamu, a traditional Indonesian health drink blending turmeric and ginger. Jamulogy conducted research into the optimal lifespan and nutritional value of herbs in its drinks and received feedback from key regional investors.

“It’s a network of people that we get introduced to, which makes mentors more accessible,” Techapichetvanich said. “It really helps us drive growth within our own startups.”

The Space F Initiative grew from a 2019 partnership between the NIA and seafood industry titan Thai Union, which originally included American company WeWork and has since transitioned to a partnership with Deloitte Consulting. 

“I think most important to the programme’s particular space is to make it more available for people outside the country,” said Tunyawat Kasemsuwan, Thai Union’s director of global innovation. “So I think letting the programme get more international is very good.”

The main challenge for Thai startups is access to high-tech equipment and laboratories for research, he said.

Another company to benefit from Space F is Profile Print, an app driven by artificial intelligence that can predict food quality and quickly analyse ingredients.

“The initiative helped pave the way to opening up the market for ProfilePrint, including introducing Thai conglomerates for us to conduct pilot trials, and expanding our market presence in the country,” General Manager Nicolette Yeo said.

All companies participating in Space F have received private investments, Kasemsuwan said, as well as 200,000 or 400,000 Thai baht ($5,600 or $11,200) from the initiative.

Dr. Agachai Sumalee of the Chulalongkorn School of Integrated Innovation said the government must provide more substantial resources to develop meaningful breakthrough technologies. He expressed concern that most of the innovations touted by Thai officials were software, applications and services but not “core technology” to produce “genuine industrial growth.” 

This shift would require a nationally coherent plan and marshalling the visions of the Kingdom’s largest corporations, he said, citing Korea and China as inspirations.

“Some of the innovation districts are attracting business and stimulating ideas,” he said. However, it “becomes hard for them to really sell the innovation, the product in practice. I think that’s where the gap is, it’s quite big and I think it will take longer time to realise this.”

To attract more businesses to integrate Thailand into their supply chains, the Kingdom also is manoeuvring to become a nexus of manufacturing, trade and logistics with its Eastern Economic Corridor (EEC), a special economic zone comprising three coastal provinces in eastern Thailand. The EEC website says the area offers expanded deep sea ports, airports and high speed rail.

Thailand cannot become a new South Korea overnight, whether in innovation or logistics, said Oliver Tian, vice president of the South Korea-based Global Robotics Cluster. He suggested Thailand invest in developing strong innovation niches tapping into the goals of larger economies, such as Japan’s Society 5.0 programme, which seeks to transition infrastructure and services into a data-driven, digital framework. 

Thailand could provide support to complement Japan’s technological transformation while benefiting from subsequent investments, he argued.

“Thailand must differentiate its innovation drives in order to compete less with the neighbouring countries,” Tian said.

While Thailand should support the necessary infrastructure for a cloud-based, data-driven economy, physical spaces and infrastructure would likely become less important for innovation in the future, as more collaborations took place across borders, Tian said.

“Innovations cannot be self-serving within a country anymore,” he said. “The global connectivity is so high that any application cannot be built for one country alone.”

The post Innovation hubs are helping invigorate Thai business appeared first on Southeast Asia Globe.

“First, become a billionaire. Then, join the public sector.”

As the archipelago works to rebuild its pandemic-ravaged economy, the jest from the entrepreneur turned civil servant took a serious turn as he called on private investment to help support Southeast Asia’s vulnerable communities and work towards sustainable recovery. 

Uno’s statement was among the opening remarks of the annual conference hosted by the Asian Venture Philanthropy Network (AVPN), Asia’s largest social investment community, matching investors and their funds with initiatives that will drive social and environmental benefit. A side event of Indonesia’s 2022 G20 Summit, the 21–24 June conference marked AVPN’s 10th year. 

The event was also a milestone for the Global Innovation Fund (GIF), a London-headquartered, nonprofit investment organisation backed by various government organisations, including the U.K.’s Foreign and Commonwealth Development Office, Australia’s Department of Foreign Affairs and Trade and the U.S. Agency for International Development. 

Southeast Asia has experienced an increase in impact investing, which involves corporate or private funds directed towards initiatives resulting in measurable environmental or social benefits. But the region’s distinct state ideologies and philanthropic cultures may not neatly fit into established Western models and standards. 

GIF’s launch is a timely symbol of what AVPN CEO Naina Subberwal Batra described as the start of “an Asian decade” of impact investing. According to the International Finance Corporation, an estimated $2.3 trillion has been invested globally since the start of the decade with the mandate of achieving positive impacts. East and Southeast Asia are the most rapid risers, upping their impact investing growth rate by 23% in 2020.

“There has always been a need for impact investment but the last few years have really given us pause for thought,” said Katie Carrasco, GIF’s head of environmental, social and governance, who leads the Singapore function. While poverty surged globally following the outbreak of Covid-19, in Southeast Asia, where some of the world’s longest lockdowns lingered, 4.3 million people entered extreme penury and 9.3 million jobs were lost. 

Emerging from a global health crisis has been a key trigger in turning investors’ attention towards portfolio additions with longer-term sustainable missions and the need to rebuild economies and communities devastated by the pandemic.

“In two years, we have seen all our sectors of life devastated,” Uno said. “It is important we take the best of these years… the innovations, the collaborations, to chart our way forward, to recover with better knowledge and sustainability.”

Singapore is capitalising on its position as a regional financial hub to steer this bandwagon. The city-state’s central bank and regulator, the Monetary Authority of Singapore, launched its first Green Bond Framework in early June to manage financial instruments designed to fund projects with positive environmental benefits. Weeks later, Temasek Trust, the philanthropic arm of government-owned investment company Temasek, launched its first Center for Impact Investing and Practices. 

The existing network and appetite for impact investing was an important factor in GIF’s decision to make the Lion City its Asian base, according to Carrasco. 

“Singapore has a great innovation ecosystem and a community of impact investors. We have key partners based here and from this angle it made sense to make this our base,” she said.

The city-state’s geographical location also makes it easier for GIF to be logistically well-connected and in tune with the demands of its stakeholders and portfolio companies.

“[One of the key challenges in Southeast Asia] is how trust-based everything is,” Carrasco said. “You really need to be present and communicate regularly. This can be a challenge for investors that are not near the work they are supporting.”

Even investors and organisations on the ground risk transferring models learnt from more mature impact investing markets in the West without understanding the idiosyncrasies of the cultures in which they want to operate. 

“The way philanthropy and social investment has been approached in the West may not work for Asia. The solutions will come from the communities within,” Carrasco said. 

While institutional corporate giving is a relatively recent concept in Southeast Asia, ingrained traditions and ideologies have helped breed a unique and long-standing culture of philanthropy. In Indonesia, Malaysia and Singapore, the concept of ‘Gotong-royong,’ meaning “carrying a shared load” in multiple Indonesian dialects, has spurred the use of pooled funds and materials to construct multiple public facilities including streets, irrigation systems and places of worship. 

State ideologies can also inspire philanthropy. Vietnam’s government has mobilised private funds to plug the gaps in public sector funding for energy, healthcare and education projects. The country is estimated to need $237 billion by 2030 to address public infrastructure requirements. The National Assembly passed its first Public Private Partnership Law on 18 june 2020. The legal framework, which came into effect from the start of 2021, aims to attract more private investment towards public infrastructure. 

International funds also face a lack of transparency when supporting governments achieve their environmental and social goals. Of the 19% of Indonesia’s national 2020 economic recovery package dedicated towards energy, 16.3% was dedicated to fossil fuels, a total of around $6.8 billion, according to the International Institute for Sustainable Development. 

A 2020 United Nations-approved payment of $103.8 million for the prevention of deforestation in Indonesia, the largest fund of its kind, raised concerns from experts. International impact funds, such as the Green Climate Fund (GCF), established in 2010 as part of the UN Framework Convention on Climate Change, questioned the integrity of how the archipelago measured its deforestation reduction. 

Hans Olav Ibrekk, a GCF board member and the energy and climate policy director at Norway’s Ministry of Foreign Affairs, pointed to the 20-year timeframe taken to measure forest-related emissions, noting in an interview with Mongabay that the GFC standard of 10–15 years would provide “higher environmental integrity.”

Chris Cattermole, ESG and advisory solutions lead at UL, an international safety and sustainability solutions provider, noted that different cultures can make measuring social impact especially challenging.

“For sure there are challenges in taking Western approaches to measuring impact in an Asian context,” he said. “For example, LGBT+ and gender data can be a lot more sensitive to collect and process in Asia… without knowledge of local (business) culture, projects may not succeed, or may not achieve outcomes Asian communities desire.”

As the trend for impact investing continues to grow, Carrasco believes this is a pivotal time for impact investment in Southeast Asia to grow: “As economies look set to account for half of all economic global output by 2050, there is huge scope for innovation that is scalable and impactful.”

In terms of meeting global standards, experts said progress is still needed. 

“Against its impressive growth rate, Asia is losing ground in regards to achieving the UN Sustainable Development Goals,” Carrasco added. “This will impact on the most vulnerable, those living on less than $5 per day, women and girls and those highly exposed to the effects of climate change.”

Governments and policy-makers need to engage with funds and private-sector organisations to drive development throughout Asia and understand the unique investing and philanthropic cultures of the region. The investment world moves fast, but according to Uno, some global trends will pervade cultures and stand the test of time.  

“I believe that there are few unstoppable trends in the world. Digitisation, sustainability, global health architecture,” he said. “These innovations will shape the next phase of Southeast Asia’s economic growth. What remains to be seen is how much investors will stake to mobilise these forces for wider social and environmental impact. 

“Government cannot do it alone,” Uno said. “Public-private partnership is the key.”

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EDF Secretariat Director, H.E Chea Kokhong, and Chairman of the Innovation and Development Investors Association, Mr. Hor Serey Vath, sat down in Silicon Valley, California with Ms. Christine Tsai, CEO of  leading international venture capital firm, 500 Global, on 16 May. Valued at over $300 billion, 500 Global’s accelerator program focuses on “markets where technology, innovation, and capital can unlock long-term value and drive economic growth.”

Their discussions centred around promotion of Cambodia’s entrepreneurial ecosystem, with cooperation, expanding new investment networks and promoting technological investment identified as key strategies for growth. The group also discussed strategies for attracting foriegn investment to Cambodia’s small and medium sized enterprises, with government incentives for venture capital firms and startups seen as promising opportunities.

Investment in sectors aligned with Cambodia’s national digital economic framework was also identified as essential to the recovery and development of the country’s economy. 

During the visit, H.E Chea Kokhong and delegates also met with startups from Singapore’s entrepreneurial ecosystem who had been chosen for the Global Launch San Francisco program. Co-organised by 500 Global and government agency Singapore Enterprise, the program provides target startups with training in Silicon Valley and facilitates their expansion into U.S. markets. Conversations focused around business strategies and experience in providing technology services and how these lessons could be applied in the Cambodian context.

Building networks with international venture capital firms and foreign startups is a major step for EDF and demonstrates the group’s forward thinking and big picture vision. This cooperation and collaboration will likely prove key in pushing Cambodia’s entrepreneurial ecosystem onto the world stage.

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The 18-year-old protagonist of science fiction film Ready Player One, directed by Steven Spielberg, had a point. His life in overcrowded downtown Oklahoma City paled in comparison to the escapism he found in the vast OASIS when he put on his virtual reality (VR) headset and transformed into the suave avatar Parzival.

Spielberg’s 2018 cult classic is set it 2045 but bears parallels to the present day, where the virtual world is making waves in the physical, fuelled psychologically by the claustrophobia of pandemic lockdowns and commercially by Big Tech backing and a highly publicised renaming by Mark Zuckerberg. The metaverse, a network of web-based domains where users can interact remotely but immersively through customised avatars, has been touted by digital investing specialist Grayscale Investments as a “trillion dollar opportunity.”

Southeast Asia’s growing connectivity and strong tech startup cultures have helped investors and entrepreneurs identify the region as a burgeoning metaverse hub. But some of Singapore’s business owners are warning that security concerns, unregulated markets and lack of governance are making virtual assets a high-stakes gamble.

A term first coined in 1982 by science fiction author Neil Stevenson, metaverse is undergoing a renaissance, one that has increased its worth to an estimated $47 billion. Already a hub for users to game, network and shop for customised avatars, the next step is a more permanent stake in the cyber-world. Sales of real estate in the metaverse topped $500 million in 2021 and investors and analytics firms predict the amount will double this year.

While a booming market in VR headsets and other futuristic hardware promises to enhance the immersive experience, a laptop or smartphone is all that is needed for basic metaverse access. 

With most countries in the region boasting almost 100% smartphone penetration, ASEAN’s connectivity has primed it for metaverse inhabitation. Earlier this year, a survey by data company Milieu Insight revealed 72% of their 6,000 respondents across the region felt positive about the prospect of “living full on in a metaverse” and carrying out everyday interactions – business deals, social networking and leisure activities such as gaming – as virtual or augmented reality experiences.

In some ways, this online world remains familiar. Digital simulations of items can be purchased, virtual clothes for your avatar, virtual furniture for your metaverse apartment. They come without the practical attributes of their physical counterparts, but with all the status and sometimes at a fraction of the price. Luxury fashion house Gucci’s 2021 entry into the metaverse, in collaboration with Belarussian company Wanna, sold the designer’s virtual sneakers for the equivalent of $12.99. 

Virtual nations are also becoming a source of pride. Metaverse Thailand – a project run by Singaporean FinTech company A PLUS – creates digital maps of Thailand’s landscapes, allowing investors to own, buy and sell a virtual piece of the Kingdom. The metaverse also plays a key role in the government’s Thailand 4.0 programme and major companies including CP Group and Siam Piwat have incorporated the metaverse as part of their business strategies. 

Indonesia Minister of Communications and Information Johnny G. Plate announced plans in March to create a metaverse ecosystem that would develop the archipelago’s economy through partnerships with international technology giants such as Microsoft, and invite key Indonesian companies in banking, hospitality and other sectors to establish a virtual presence. 

But while Singapore has consciously positioned itself as a Smart nation leader and a digital pioneer in ASEAN, the survey showed Lion City residents to be more cautious than their regional peers. Only 56% of respondents felt positive about using metaverse technology for everyday transactions.

“Like any new tech, there are going to be supporters as well as detractors,” Bell Beh reasoned. The Singaporean entrepreneur’s company BuzzAR, Southeast Asia’s first woman-led metaverse startup, announced $3.8 million in seed funding in February. 

She cited various reasons behind Singapore’s perceived caution, including “the nation’s reputation as a “financial hub [which means] fad-chasers may consider Singapore over other regions,” which could overhype and inflate the metaverse bubble.

In a sector she described as “a learning process for everyone, including myself,” Beh has banked on markets that have suffered in the physical world during the pandemic: hospitality and tourism. During 2020, BuzzAR partnered with the Singapore Tourism Board and a major hotel chain to create an augmented reality avatar of the property. The project became Singapore’s first virtual hospitality experience.

She is not the only one looking at digital simulations of bricks and mortar. Singaporean singer JJ Lin made headlines at the end of 2021 with his purchase of three metaverse-based properties costing more than $90,000.

Property developers also are turning their eyes to the metaverse. Singapore-headquartered Hatten Land is currently developing its own virtual land platform.

“Increasingly, there are more and more investors who understand and favour virtual assets,” observed Lionel Chok, Hatten Land’s chief metaverse officer. He believes increasing regulation of the physical real estate market and decline of buyer and renter demand during the pandemic have accelerated interest in virtual properties as an asset.

“There’s a generation who find themselves priced out by high costs of physical properties, especially those who have been looking for investments,” Chok remarked. These investors will be part of Hatten Land’s new virtual target market.

The nascent industry is primed for what he calls “healthy competition” between sectors.

“Today, virtual land platforms are developed by techies. There remains a valuable opportunity for established and experienced real-world land and estate developers to extend their credentials and lead in this space,” Chok said.

“It’s escapism,” said Andrew Psarianos, CEO of virtual reality training company, weARVR.one. “If you’ve got a VR headset, you can go anywhere you want to go.”

Psarianos escapes his small but airy office in Singapore’s Payar Labar district through a smooth, black headset into Multiverse, an interactive VR app. One of Multiverse’s focuses is virtual real estate and architecture. 

Psarianos can work from the white walls and high ceilings of his metaverse office or make presentations to the curved mahogany booths of a virtual conference room. There are also modern, minimalist apartments in high-rise condominiums, sparsely decorated to leave purchasers to buy and integrate their own interior decoration. The online units include a lounge with wood-panelled floorboards, a wraparound balcony and no toilet.

Available apartments retail as low as $100, paid in a cryptocurrency called Goldcoin. Cryptocurrency is a common payment for property in the metaverse, but while users can cash in on more established cryptocurrencies such as Bitcoin or Ethereum, there is currently no way to convert Goldcoin back into real tender.

“Goldcoin… has got no value at the moment,” Psarianos said. “It’s just gambling. Hopefully it’ll go through the roof.”

Whether or not the virtual property bubble will burst, Psarianos believes the real revenue lies not in the virtual property itself, but in advertising.

Strategically placed virtual billboards in metaverse neighbourhoods can build brand visibility. Businesses can reward users for association, such as a branded poster displayed on the virtual property they own. Companies also can purchase virtual outlets linked to their physical supply system, allowing users to make metaverse purchases that materialise in real life.

Metaverse real estate sales for January 2022 sales were estimated at more than 10 times the number one year previously. 

As increasing numbers of property owners turn the metaverse into an eyeball aggregator, big brands from Gucci to McDonalds are willing to pay for the eyeballs.

“Around a normal city, bus stations have got branding, shopping malls got branding, pop-ups everywhere. It’ll be the same thing with this,” Psarianos said.

Behind the metaverse’s closed doors, an illicit business is thriving. While Zuckerberg has banned sex as an approved virtual activity in his metaverse, a vanguard of pornographers, sex workers and web developers are driving a burgeoning virtual sex industry. Analyst firm Piper Jaffray predicted adult content will be a $1 billion business by 2025, the third biggest virtual reality sector.

Cybercrime against children is a concern in both private and public spaces. Psarianos related accounts of metaverse porn shops and brothels in closed, password-protected virtual rooms. In those locations, verifying the age of the real-world users behind the avatars can be almost impossible.

While some platforms have installed safety features allowing users to block other avatars, Psarianos worries harassers are easily able to log back into the metaverse using a different IP address, email account and avatar.

“You can be anyone. They create this fake everything,” he said.

Abhinandan Chillal, a Singapore-based senior cybersecurity consultant at management consultancy Sia Partners, believes regulation by an independent body would allow users to make more informed decisions about the online worlds they inhabit and their habits within them.

“It would be ideal to have metaverses assessed on safety and ethical grounds, put a rating against them and make this information available in the public domain. This would help users decide the metaverses that suit their preference and the ones that don’t,” he said.

For Roland Ong, Hatten Land’s strategic advisor and chairman of the Esports Entertainment Asia association, a greater cultural shift is needed. He advocates for a structured governance of virtual society, not unlike his experiences growing up in the Lion City.

“Parents, government and society have to work together,” he said. “[And] maybe schools? No-one has set an agenda.”

He recalled the Hao Gong Min, a civil and moral education textbook for Singaporean primary school students.

“When we were growing up, we had books that teach us to be a good citizen. But society and the school system hasn’t caught up with teaching you to be good citizens online,” he said.

In Ready Player One, life in OASIS turns out to be more challenging – and corrupt – than Watts expects. As a sequel to the film is in the works, Singapore’s metaverse stakeholders also are looking forward and making plans. While the evolving market remains a high-risk gamble, many have chosen to hedge their bets.

“It might [just] be a shiny new toy but why not look for the business opportunity?” Psarianos said. He claimed his own metaverse investment has already increased tenfold since December 2021.

“I foresee the appetite will grow,” he said. “Like any investment, you need to keep an eye on it and get out before the bubble bursts.”

The post Singapore surveys virtual property’s Wild West landscape appeared first on Southeast Asia Globe.

Singapore welcomed the first batch of vaccinated international travellers from North America and several European countries through VTL in October 2021. At that point, though, Singapore’s borders remained closed to some of its immediate Southeast Asian neighbours including Thailand. VTL with Vietnam only launched on 16 March.

Many find the region’s travel restriction policy at odds with rhetoric about a collective response. During the pandemic, ASEAN nations have retreated from multilateralism by detaching themselves from regional institutions and focusing on national policy responses including lockdowns and closed borders. ASEAN’s collective ability to address the security of member states has been tested.

The challenges presented by the pandemic have drawn the attention of global leaders to a broader category of national security: biosecurity. 

Biosecurity risks include the introduction or spread of harmful organisms to human, animal and plant life, typically from infectious diseases, deadly pathogens, toxins and biochemical weapons. 

As a regional economic leader, Singapore should shoulder more responsibility in initiatives to strengthen ASEAN’s capacity for multilateral engagement on biosecurity to implement effective prevention and response mechanisms as non-traditional threats like the pandemic have consistently tested the region’s resilience. 

However, as a rapidly growing economic and social area, Southeast Asia should have long ago developed the capacity to ensure regional self-sufficiency on a multilateral basis in times of biosecurity and public health crisis. 

As most ASEAN members continue to navigate pandemic complexities, it is time for the region to design a model that is not dependent on external input but takes advantage of shared resources and support.

With its reliance on tourism, manufacturing, international trade and labour mobility, Southeast Asia cannot afford isolationism. Brookings Institution research in 2018 found ASEAN member states have an average trade-to-GDP ratio of 119%, spotlighting a high level of economic integration.

Regional peace and stability are a premise for Singapore’s continued prosperity. Despite being the most economically developed country in the region, the Red Dot relies on neighbours for labour supply in its service and manufacturing industries, the import of natural resources and commodities to support domestic consumption and the demand for international trade due to its strategic location. These networks ground to a halt when Singapore shut its borders during the health crisis.

Southeast Asia’s inadequate regional capacity to counter the spread of infectious diseases is long-standing, yet detrimental to the region’s development. 

During the outbreak of severe acute respiratory syndrome (SARS), a viral respiratory disease that emerged in China in 2002, Singapore suffered a 0.47% GDP loss primarily in the tourism sector due to border restrictions after cases were identified there.

Existing multilateral efforts to enhance biosecurity capacity are limited and rely on external input

ASEAN was passive during the SARS crisis, unable to enforce a collective will on member states who disagreed over policies due to a lack of clear leadership. 

Much of the multilateral interaction was with ASEAN Plus Three, a coalition of China, Japan and South Korea through which the trio of East Asian powers used their existing resources and protocols to combat the disease. 

ASEAN members instead focused on developing their own policies on quarantine, international travel and work suspension to contain the virus spread within national borders.

Existing multilateral efforts to enhance biosecurity capacity are limited and rely on external input. The Southeast Asia Strategic Multilateral Biosecurity Dialogue started in 2014 as a bilateral discussion between Singapore and the United States and in 2019 expanded to include participants from Malaysia, Indonesia and the Philippines.

During informal discussions on emerging, regional biosecurity challenges, the Southeast Asian participants were concerned about a perceived lessening of U.S. interest in international programmes and global collaborations.

The initiative will require coordination from the ministries of defence, health and foreign affairs of each ASEAN member state. Diplomatic engagement is critical for governments to communicate intentions, expectations and decision-making apparatus that can strengthen input from NGOs. 

Protocols for data analytics and information-sharing, which strengthen ASEAN’s response capabilities to naturally occurring or artificial biological threats, allow transparency and consistency informing macro-policy decisions. 

In health crises, efforts to standardise vaccine recognition and cross-border movement policies will have immediate benefits for businesses and individuals in the prolonged wrestling with the Covid-19 pandemic.

Governments also will have more leverage in resisting potential dilemmas as a result of competition between the U.S. and China, which has been on display in the messy vaccine diplomacy of the past year. 

With an edge in economy, big data, digital technologies and a strong public sector and rapid policy response, Singapore has much to share with the region regarding pandemic response and continued disease surveillance. 

Instead of abandoning ASEAN and working bilaterally with more economically enriched  countries, Singapore should reinvest in ASEAN and its long-term institutional capacity to counter potential biosecurity crises.

Yutong Niu is a Women in Security fellow at Pomona College in California and a former research intern at Pacific Forum, a Honolulu-based think tank focused on the Asia-Pacific region.

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The menu, designed by celebrated Hawaiian chef Kaimana Chee, debuted the world’s first “cruelty-free” chicken nuggets, made not from farm-reared livestock, but lab-grown from animal cells.

On beds of maple waffles and fluffy Chinese bao, the unassuming tidbits made Singapore the worlds’ first country to approve the sale of cultivated meat and marked a business breakthrough for American entrepreneur Josh Tetrick and his company Eat Just, the brainchild behind the meat.

“Everyone enjoyed it. Some of them even wanted more,” recalled Reyel Shah, 1880’s Food and beverage manager. “It took me days before I got my first bite.”

Government backing and growing awareness of food sustainability has set the table for a host of domestic companies to follow Tetrick’s recipe for commercial success. For this small island heavily reliant on imports for its food supply, lab-grown meat is a hungry new market that could be vital in feeding Singapore’s post-pandemic economy.

“Food insecurity and sustainability are among the most significant global challenges in the 21st century,” said Christine Amour-Levar, CEO and co-founder of HER Planet Earth, an NGO that assisted the Eat Just Singapore launch. “Simply put, our current food system is harming our health and our planet.”

Her warning is echoed through worldwide spending. A surge in the alternative proteins sector is expected to reach at least $290 billion by 2035, with up to a tenth of all meat, eggs, dairy and seafood cultivated by food technology. An edible space race has won financial backing from tycoons including Bill Gates, Richard Branson and giants from the traditional food industry such as Tyson, Cargill and Bell Food Group.

In Singapore, this shift comes with an extra sense of urgency. The diminutive island lacks arable land and is reliant on import for more than 90% of its food. Disrupted supply chains during the pandemic have highlighted the need for greater food security and turned up the spotlight on the government’s objective to fulfil 30% of the city-state’s nutritional needs within the decade. For Armour-Levar, this requires an openness to new technologies.

“This ‘30 by 30’ goal starts with leveraging existing industry segments and by being receptive to innovative solutions in the alternative protein space especially,” she said.

State investment company Temasek has fed this demand, pumping more than $5.4 billion (SGD 8 billion) into the agritech sector. Eat Just has announced Singapore as its main Asia hub and potential global manufacturing base and ploughed some of its recent $170 million funding into a Singapore factory. Additionally, Singaporean contract development and manufacturing organisation Esco Aster was granted approval in September 2020 to start production of the cultivated chicken.

According to a statement from the Singapore Food Agency (SFA), the appetite for alternative proteins is still unsated. 

“Many companies in this space have identified the unmet needs of consumers in Asia,” the government body confirmed. “Singapore’s support of innovation and R&D will help accelerate the growth of local alternative protein sectors.”

Among these is Shiok Meats, which used cellular technology to develop the world’s first cultivated shrimp, lobster and crab prototypes in 2019, 2020 and 2021 respectively. They are targeting the regional market “to make Asia’s local and loved dishes,” according to group CEO and chairman Dr. Sandhya Sriram.

SFA’s approval of Tetrick’s chicken was a nod that they were moving in the right direction.

“Eat Just is excellent news for all companies working on delivering cruelty-free and sustainable seafood and meats, not just in Asia but worldwide,” Sriram said.

Yet in a cautious food regulatory market, Shiok Meats is still in the R&D phase three years after its inception, with a target to commercialise in 2023.

Companies producing novel food products are required to conduct and submit safety assessments according to SFA standards. The agency has also worked alongside A*STAR, a statutory board under the Ministry of Trade and Industry of Singapore, and Nanyang Technological University to launch Future Ready Food Safety Hub (FRESH), a public-private partnership platform, in early 2021.

“Alternative proteins are at the forefront of food science innovation. Nevertheless, food safety must be a principal consideration,” warned Dr Tan Lee Kim, director-general (food administration) and deputy CEO at the SFA.

Eat Just’s own Singaporean success was overshadowed by previous stumbles in the race to market.  Two years before his 2020 Singapore debut, Tetrick was confronted by inspectors from the Dutch SFA for sneaking a package of lab-grown meat into the Netherlands, hoping to beat the arrival of an upcoming European regulation.

“Tetrick is aggressive,” remarked noted Keri Matwick, doctor of food philosophy at Nanyang Technological University.  “His desire to be first in the market appears greedy.”

Eat Just’s successful navigation of the Singapore regulatory landscape could be a token of redeemed credibility. The SFA confirmed that products such as Tetrick’s typically undergo three rigorous levels of safety assessment: the individual elements, the process and the final product.

“We encourage food innovators to engage SFA early to facilitate the regulatory approval process,” Tan advised.

For products that have reached the market, there is also the issue of accessibility. Shiok Meat’s proto shrimp costs around $5,000 per kilogram to produce.

“There is a cautionary tone about whether high price will deter consumption,” noted Matwick. “The media is noting that most people won’t be able to afford eating cultured meat on a regular basis.”

However, Shah believes this exclusivity is what makes lab-grown food an ideal fit for his 1880 customers and a discerning Singaporean market.

“We are critical in our consumption, but we are willing to pay for it,” he said. “[We are] known as one of the most expensive cities in the world. I think it’s wise [for] something like that to be in Singapore.”

Despite their glitzy arrival into the Lion City, many cultivated meat companies aim to lower their prices. Shiok Meats’ goal is to make its shrimp 100 times cheaper by the time they commercialise. As they enter the mainstream, they will meet new competition from the old kids on the block. Plant-based meats are an established entrant in the local food scene and Singapore’s market grew at a steady 7.4% last year, even during the height of the pandemic in the country.  

It is possible that in the future, live animals will no longer be needed”

Dr. Jaipal Singh, executive director of the Society for the Prevention of Cruelty to Animals in Singapore

“Cultured meat will have a harder time being accepted as ‘normal,’” Matwick suggested. “Plant-based foods align closely to a vegetarian ethos and are easier to conceptualise.”

The necessity of live animal cells in the production process of lab-grown meat could be hard for some consumers to stomach. 

Dr. Jaipal Singh, executive director of the Society for the Prevention of Cruelty to Animals in Singapore, said safeguarding the welfare of the animals should be a key consideration throughout the process, “for instance, if a biopsy is performed, it can be done under a local anesthetic.”

Singh said he believes the faster technology evolves, the greater the potential to end animal suffering in factory farms. 

“It is possible that in the future, live animals will no longer be needed, or at least only in very small numbers,” he explained. “Since only very small numbers of animals are required, it would be possible to provide high levels of welfare and no effort should be spared in this regard.” 

Shiok Meats is covering both bases by combining its cultivated seafood with plant-based ingredients to create hybrid products.

“Whether plant-based or cultivated, all of us are working towards feeding the expected 10 billion population by 2050,” Sriram said. “There is competition. “[But] we call it a ‘healthy’ competition.”

While Tetrick’s chicken leaves no doubt over who came first in Singapore’s alternative protein race, the question is what follows. 

The government has allocated $44.3 million (SGD 60 million) toward an Agri-Food Cluster Transformation Fund to support new food innovations, while the SFA has partnered with A*STAR to develop the Singapore Food Story R&D programme. One of its key themes is supplementing Singapore’s nutritional needs through future foods such as alternative proteins.

Cultivated meat never made it onto the permanent menu at 1880, despite a short-lived collaboration with e-commerce platform FoodPanda beginning on Earth Day in April through which consumers in the club’s vicinity could order a selection of chef Chee’s Eat Just dishes. Instead, the company’s lab-grown food is now available at another high-end restaurant celebrating local cuisine: Madame Fan. 

A mainstream alternative proteins market is unlikely to appear overnight. The shift is more likely to echo Shah’s own experience when he finally got to sample a cultivated nugget.

“It’s like an acquired taste,” he mused. “The first bite was something to think about. [Then]… you begin to like it, you know?”

Attention to local tastes, regulatory structures and targeting more accessible prices will help accelerate the still nascent food innovation economy. The technology and investment Singapore has pumped into this already meaty market has given it a first bite of the pie.

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