Low labour cost is the main attractiveness in Asia. Though the rate is increasing it is still low compared to other western economies. Low defensible labour costs, which have traditionally been a source of competitiveness, are neither impressive nor sustainable. On the other hand, many ASEAN countries are less responsive to technological changes. They fail to accelerate the pace of transformation needed to sustain their manufacturing advantage. Some ASEAN countries still rely on basic manufacturing. Their rates of value addition are significantly less than those in the more advanced industrialized economies.
THE GLOBAL MANUFACTURING SYSTEM IS REFORMING TOWARDS TECHNOLOGY THROUGH INDUSTRIAL REVOLUTION 4.0. TECHNOLOGIES LIKE ROBOTICS, ARTIFICIAL INTELLIGENCE, NANOTECHNOLOGY AND BIG DATA HAVE BEEN INCORPORATED IN INDUSTRIAL REVOLUTION 4.0. NOW THE QUESTION ARISES, WILL THE ASEAN COUNTRY BE CAPABLE TO ADOPT THIS TECHNOLOGY? WON’T IT INCREASE THE RATE OF UNEMPLOYMENT AND WHAT ARE THE CHALLENGES?
New technology must be adopted and workers must be upskilled to handle them. Failure to do so will certainly result in the loss of manufacturing investments and jobs.
The UN’s International Labour Organization has identified Vietnam, Cambodia, Thailand and Indonesia as having the highest number of workers at risk from automation.
On the other hand, leading countries like Singapore, Japan and China are ranked 2nd, 16th and 25th in the list respectively according to the report of World Economic Forum’s (WEF’s) for transforming production systems in the Industry 4.0.
However, in ASEAN, the deployment of 4IR technologies has mostly been undertaken by multinational corporations and larger local enterprises.
Therefore, ensuring that small and medium enterprises participate in such transformation and that the whole labour force is up skilled, will be key to achieving a more inclusive and broad-based growth. On the other hand, it is difficult for small and medium enterprises to cope with the changes and competing with big industries.
Sanjeedah Akhter Priya
Jahangirnagar University
