Liew Weihan, CEO of Mainspring Technology Ltd, answers questions right before the opening ceremony of the Tsinghua PBCSF Belt and Road EMBA Program for Southeast Asia on May 11, 2017 in Beijing.
In response to the Belt and Road Initiative, technology and funds from China will help Southeast Asia develop its own mobile internet sector, said Liew Weihan, CEO of Mainspring Technology Ltd, an online media company based in Jakarta, Indonesia.
"The next decade will be a golden era for the internet in Southeast Asia, most notably Indonesia, Malaysia, Vietnam and the Philippines," predicted the Malaysian-Chinese in an email reply to chinadaily.com.cn on Thursday. He started up his own business in 2012 in Indonesia, the world's fourth most populous country with 260 million people, after working three years with venture investor Nokia Growth Partners in China, four years with Microsoft and three years with Boston Consulting Group.
He explained that as mobile internet penetration and GDP per capita increase, Southeast Asia, like China before it, will see a proliferation of internet-based services that disrupt consumer industries as diverse as finance, shopping, automotive, media and entertainment.
The number of internet users in Indonesia just surpassed 100 million people in 2017 and is expected to double over the next five to 10 years, according to Liew.
World Bank predicted Indonesian GDP in 2016 to grow by 5.1 percent year-on-year from 2 billion in 2015 and will grow by 5.3 percent in 2017, according to indonesia-investments.com. Accounting firm Deloitte also predicted in an investment guild released in March that the country's economy will grow by an average of 5.2 percent in the next five years.
Liew is among the early birds who know there are big worms in the internet sector in Southeast Asia. He tapped the Indonesian market with a web game and later moved to news aggregation. His company's BaBe news app, similar to China's Toutiao, has been downloaded more than 10 million times in Indonesia and Malaysia. Mainspring Technology gained its Round A and Round B financing of tens of millions of dollars from China-based venture capital including the Gobi Fund and Fosun Kinzon in 2013 and 2014.
"We are a direct beneficiary of the Belt and Road Initiative as our technology, capital, and experience are all from China," Liew told chinadaily.com.cn on May 11at Tsinghua University in Beijing.
Likewise, the initiative will propel the growth of the entire internet sector across Southeast Asia in three ways, Liew said.
He said the initiative can help bridge the gap between Chinese technology developers and local companies in Southeast Asia that can apply these technologies to the needs of each local market. Liew added that the Chinese internet industry has made tremendous technological strides in the past two decades, producing not just local giants but a vibrant ecosystem of startups building a leading edge and world class technology.
The initiative will help with financing needs, not just through State-owned investment funds such as the Silk Road Fund, but also by giving more exposure to fast growing Southeast Asian startups and markets to Chinese and global investors, adding that the actual amount of venture capital available to Southeast Asian startups is miniscule compared to that of Silicon Valley and Beijing.
Many Southeast Asian countries are perpetually trying to catch up on basic internet infrastructure, as the problem is especially acute in large archipelago countries with widely dispersed populations not connected by land. The initiative can help accelerate the development of such basic infrastructure and facilitate the spread of internet access to small towns and rural areas, where more than half the population still resides, he said.
While the picture for the sector is rosy and more Chinese tech companies are willing to join the bandwagon, talent might be a key challenge facing these companies.