Cloud Computing Is the Missing Link in Regional AI Ambitions

Harmonising cloud standards and rules must be a priority for Apec.

- Wendy Cutler and Shay Wester

Tariff hikes and strategic competition have dominated headlines, but a quieter issue risks being overlooked, one that is just as consequential for economic growth and business opportunity: how countries govern the infrastructure powering the digital economy.

Cloud infrastructure has become the plumbing of the modern economy.

Trade flows today are no longer shaped solely by tariffs, ports, or Customs procedures. Increasingly, they depend on secure, trusted cloud computing systems.

These systems underpin how firms scale and how workers stay productive. They also shape how citizens access information, healthcare, and education—services increasingly delivered online.

Yet, regulatory fragmentation is holding back progress. Inconsistent rules and standards across economies are slowing cloud adoption and raising costs for business.

Take a mid-sized logistics company operating in several countries. Just to use the same cloud-based supply chain platform, it must navigate separate data localisation laws, obtain multiple cyber-security certifications, and dedicate significant resources to compliance across markets.

Smaller businesses face similar hurdles, but lack the resources to manage them. Such challenges are even steeper for digital start-ups, which depend heavily on cloud services.

This fragmentation effectively raises the cost of innovation and expansion, creating an uneven playing field for less-resourced firms.

These barriers don't just affect individual companies. When cloud adoption stalls, digital transformation across entire economies is jeopardised.

According to the Asian Development Bank, cloud adoption contributes between 0.25 per cent and 2.23 per cent of gross domestic product across 10 Asia-Pacific Economic Cooperation (Apec) economies—a wide range explained in large part by differences in regulatory environments.