Panel: E-Commerce Crucial For Development, Some Eager To Negotiate At WTO

The United Nations Conference on Trade and Development (UNCTAD) and its annual weeklong event focused on electronic commerce inspired a group of World Trade Organization members to launch a roadmap for e-commerce last year. This week, at the start of the fourth UNCTAD E-Commerce Week, a panel commented on the importance of e-commerce discussions at the World Trade Organization, even as some of the WTO membership disagrees on a new negotiating mandate.

UNCTAD E-Commerce Week is taking place from 16-20 April.

The Friends of E-Commerce is a group of WTO members pushing for discussions at the WTO on e-commerce. At the last WTO Ministerial conference in December, 71 countries signed a joint statement [pdf] announcing that they would start “exploratory work together toward future WTO negotiations on trade-related aspects of electronic commerce.”

The Friends of E-Commerce are: Kenya, Nigeria, Sri Lanka, Pakistan, Kazakhstan, Moldova, Montenegro, China, Mexico, Colombia, Costa Rica, Argentina, Uruguay, Chile, and Guatemala.

Anusha Rahman Khan, minister of state for information technology and telecommunication in Pakistan, said the last five years have seen phenomenal change in Pakistan. The digital economy is a reality of the 21^st century, and of the 4^th industrial revolution, she added.

​Countries aiming to develop their economies cannot ignore that digital is the way forward, she said. She also remarked on the fact that the young generation in developing countries must become IT freelancers, use the technology for producing wealth, and not confine themselves to only being Facebook and Tweeter users.

Internet disrupted industry and forced companies to adapt, said Tudor Ulianovschi, minister of Foreign Affairs and European Integration of Moldova, and president of the UNCTAD Trade and Development Board. Internet and e-commerce are a new reality that allows for a greater role for micro and small and medium-sized enterprises (MSMEs) in the international trading landscape, he said.

Moldova, a small landlocked economy, is now a digitally transformed country through e-government reform in the country, he said. Moldova now has universal access to high speed broadband and the government played a crucial role in the establishment of infrastructure and services, he said.

A number of measures have been taken in Moldova to facilitate e-commerce, including simplified customs procedures, urgent delivery system, logistics facilities, and support for cross-border e-commerce facilitation, said Ulianovschi.

Chinese Ambassador Zhang Xiangchen underlined the need to have in-depth knowledge and full awareness of e-commerce from a development perspective. E-commerce, he said, is offering developing countries opportunities to catch up and reach the global marketplace, and they need to embrace this opportunity.

He remarked on the booming Chinese e-commerce sector, but said there are many challenges to be overcome in developing countries, such as the lack of regulatory frameworks, means for online payments, lack of infrastructure, and digital gaps.

Xiangchen said a two-week workshop on e-commerce will take place in May in China, gathering experts from developing countries.

Jose Luis Cancela Gomez, Uruguayan ambassador in Geneva, said Latin America is still facing numerous challenges to take advantage of e-commerce, even if countries in the region are aware of the important role that e-commerce can play for development.

Revisiting the Roadmap, WTO to Collaborate with Others

WTO General Council Chair Junichi Ihara, the Japanese ambassador, said it would be a good idea to revisit the Friends of E-Commerce roadmap [pdf]. Japan is not a member of the group, but is among the signatories of the joint statement from the December Ministerial.

Important developments have taken place in WTO, he said, but despite an active discussion during the December Ministerial Conference, the outcome was not significant, and “rather disappointing.”

The seven-point roadmap, launched at the 3rd UNCTAC e-commerce week last year, is useful for developing countries, he said. However, the criteria of the seven points suggest elements to be considered in the future of WTO negotiations on e-commerce, and include different actors and factors, but they are not clearly delineated, he explained. For example, the criteria do not establish the role of governments, the private sector, the relationship between domestic policy and international rules, and the possibility of collaboration between the WTO with other international organisations, he said.

In many developing countries, some IT services and infrastructure are provided by private companies, and financed through foreign direct investment, Ihara said, adding that it is important for developing countries to improve their investment environment. In particular, countries have to consider the appropriate competition policy and regulatory measures.

Other areas, such as consumer protection, prevention of cybercrime, or payment solutions are all trade-related, and “the WTO cannot handle them with enough competence and expertise, so there should be more collaboration among relevant international organisations,” he said.

The Need to Win the Trust of Developing Countries

In the audience, someone asked if the issue of digital divide, the need for harmonised data protection, and the need for a global antitrust authority were addressed in WTO discussions, which are closed.

Amb. Xiangchen said there are two different levels of discussion at the WTO on e-commerce. One is the 1998 work programme on e-commerce, and alongside this there is the work set out in the joint statement on e-commerce. The second session of the exploratory work is taking place this week, he said, adding that there are currently no formal negotiations on e-commerce at the WTO.

Many developing countries are still reluctant to join the discussion on e-commerce, he said. They do not know in what way they can deal with the digital divide and their concerns are valid, he said. It is important to understand how to engage developing countries to join the discussion, he added.

According to Ihara, in addition to the 71 signatories of the joint statement on e-commerce, 20 other countries joined for the first session of the exploratory work.

The digital divide, data protection, and antitrust policy are difficult issues, he said, but they all can be put on the table for discussion. Japan is dealing with the digital divide by providing assistance to developing countries. The WTO has limited expertise in some issues and the discussions should be more focused on issues directly related to international trade, he said. “WTO is not almighty,” he said. “We have to be humble on this.”

 

Image Credits: Catherine Saez