Digital trade negotiations- understanding non-participation (National board of Trade – Sweden)

Arguments

Digital trade is at everybody’s doorstep and it’s happening within borders.

Supporting facts:

• Many developing countries are joining the JSI.

Topics: Digital Trade, Global Trade

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Building negotiating capacity and knowledge should happen step-by-step.

Supporting facts:

• Long-term knowledge and capacity building can occur through regional to global extensions and through developmental cooperation.

• The use of dialogues and non-binding principles can propel growth in regulatory capacity.

Topics: Trade Negotiations, Capacity Building

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It is possible to create a global regulatory framework for digital economy issues

Supporting facts:

• Alignment or common ground exists between different approaches suggests a potential for a common regulatory framework

• Example of e-commerce law where there’s been 30 years of coalescing around the regulation

Topics: Trade rules, Regulatory frameworks, Digital economy

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Privacy protection online might be seen differently by countries but it’s fundamental for trust in e-commerce

Supporting facts:

• In the EU, privacy is a fundamental right

• All agree that protecting data online and privacy is important for the trust in e-commerce

Topics: Privacy, E-commerce, Online trust

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Possible to apply trade rules treatment to data flows

Supporting facts:

• There are two main approaches to data flows: the EU’s and the CPTPP approach

• If protectionist measures are removed from the equation, these two approaches are very similar

Topics: Data Flows, Trade rules

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The U.S. did not withdraw from the negotiations, but withdrew their proposals on three articles due to an ongoing internal consultation

Supporting facts:

• The U.S. indicated that they are undergoing an internal consultation as to the balance that those provisions have embedded in them

• The U.S. did not leave the room

Topics: U.S., Data Localization, Negotiations

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The negotiation process is challenging and requires participation from all stakeholders

Supporting facts:

• Every member that has joined has had the opportunity to propose their provisions

• Overall a set of 40 plus or perhaps closer to 60 different proposals on the table

Topics: Negotiations, Stakeholders

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The importance of finding a balance between meaningful rules that support business trade and ensuring legitimate regulatory purposes

Supporting facts:

• The EU developed their position as regards international data flows at around 2018

• Stopping all international trade can lead to loss of jobs and poor economy

Topics: Digital Economy, Businesses, Regulations

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Digital trade is not only for big platforms, but for everybody in the economy, including SMEs

Supporting facts:

• SMEs need digital trade for their processes, designs, etc

• SMEs would find it painful if certain things were not insured as they cannot find it in their local market

Topics: Digital Trade, Economy, SMEs

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Report

The Joint Statement Initiative (JSI) is gaining recognition as a crucial platform for promoting digital trade, reducing inequalities, and supporting economic growth. Developing countries are increasingly realizing the importance of participating in the JSI as digital trade continues to expand.

Implementing digital trade rules can greatly benefit countries in various ways. These rules provide a framework for conducting digital transactions seamlessly, thereby supporting a country’s internal digital economy and facilitating frictionless digital trade. To achieve success in trade negotiations, it is essential to gradually build negotiating capacity and knowledge.

Long-term knowledge and capacity building can be fostered through regional to global extensions and developmental cooperation. Additionally, the use of dialogues and non-binding principles can enhance regulatory capacity growth. This step-by-step approach ensures that countries acquire the necessary skills and expertise to effectively negotiate digital trade rules.

Knowledge building plays a pivotal role in the development of digital trade frameworks. An illustrative example is the model e-commerce law introduced by UNCITRAL in 1996. This law played a significant role in helping countries establish their initial e-commerce frameworks. This demonstrates how accumulating knowledge and building frameworks over time can facilitate the agreement on trade negotiations.

There is a strong potential for the establishment of a global regulatory framework for digital economy issues. Despite different approaches, there is alignment and common ground between diverse perspectives, indicating the possibility of creating a common regulatory framework. Over the past three decades, discussions on the need for regulations in the field of e-commerce have shown a convergence of ideas, suggesting the likelihood of such a global framework.

Protecting data and privacy online is pivotal in fostering trust in e-commerce. While countries may have varying views on privacy protection, the consensus remains that safeguarding data and privacy is crucial. In the European Union (EU), privacy is considered a fundamental right, underscoring the significance of data protection in the digital sphere.

Data flows follow two main approaches—the EU’s approach and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) approach. Despite their differences, it is possible to apply trade rules treatment to data flows if protectionist measures are eliminated. The removal of such measures reveals that the two approaches fundamentally share similarities.

The application of trade rules to Artificial Intelligence (AI) is currently challenging. AI is still in the experimental phase, and numerous uncertainties surround its use. Different countries are experimenting with AI legislation, making it difficult to establish concrete trade rules for this emerging technology.

During negotiations, the United States withdrew its proposals on three articles but remained engaged in the discussion. The US indicated that it was internally consulting in order to strike a balance regarding the provisions embedded in the proposals. This highlights the ongoing nature of negotiations and the willingness of countries to actively participate.

The negotiation process itself is complex and requires involvement from all stakeholders. Every member participating in the JSI has the opportunity to propose provisions, resulting in a diverse set of proposals on the table. The challenge lies in finding common ground and achieving consensus among the various stakeholders involved.

Finding a balance between meaningful rules that support business trade and ensuring legitimate regulatory purposes is crucial. Halting all international trade can have detrimental effects on job opportunities and the overall economy. Therefore, it is crucial to establish regulations that facilitate trade while also meeting legitimate regulatory objectives.

The EU has well-defined regulations concerning the international flows of personal data, provided that privacy is protected. This underscores the EU’s commitment to striking a balance between digital trade and privacy concerns. Lastly, digital trade is not limited to big platforms alone; it is also vital for small and medium-sized enterprises (SMEs) in the economy.

SMEs rely on digital trade for various processes and designs. Inadequate insurance in certain aspects can impede SMEs’ ability to find alternative solutions within their local markets. In conclusion, the Joint Statement Initiative (JSI) holds immense potential for promoting digital trade, reducing inequalities, and supporting economic growth.

Developing countries are increasingly recognizing the value of participating in the JSI as digital trade continues to expand. Implementing digital trade rules, fostering step-by-step negotiation capacity and knowledge building, establishing a global regulatory framework, protecting data and privacy, addressing data flows and AI, and engaging stakeholders are all crucial elements for ensuring the success of the JSI.

Furthermore, finding the right balance between trade facilitation and regulatory objectives is vital. The EU’s robust regulations on international data flows and the importance of digital trade for SMEs further emphasize the benefits and significance of the JSI.

Arguments

The US recently dropped demands in the joint initiative on e-commerce

Supporting facts:

• The decision was made in the context of the joint initiative on e-commerce

• The demands that were dropped relate to data localization and data governance

Topics: e-commerce, Data localization, Data governance

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Developing countries are not participating in digital trade rules due to their lack of regulations and understanding of the paradigms of those regulations.

Supporting facts:

• The US, who shaped the global digital trade paradigm, has abdicated from top positions due to implications to their domestic regulation. EU’s digital laws and regulations do not correspond to their digital trade positions internationally. Additionally, countries do not have defined regulations and are unaware of the paradigms of those regulations.

Topics: Digital Trade Rules, Developing Countries, Regulations

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The EU protects its agrarian interests but asks African countries to adopt rules set by US big tech.

Supporting facts:

• The EU has a long history of agriculture and still maintains protectionist policies in international trade.

• A push is being made for African countries to join the JSI and adopt rules set by US big tech.

Topics: trade negotiations, technology

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The current system of trade negotiations is biased towards the interests of the developed countries.

Supporting facts:

• The interests of developed countries come before those of developing countries, particularly those in Africa.

• Trade negotiators are seen as serving their domestic interests first.

Topics: trade negotiations, developed and developing countries

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Report

The US recently dropped demands in the joint initiative on e-commerce, specifically related to data localization and data governance. This decision has raised questions about its motivations, particularly regarding African engagement in the negotiations. Developing countries face challenges in participating in digital trade rules due to a lack of regulations and understanding of the paradigms behind them.

This hinders their ability to shape the rules to their advantage and fully engage in discussions. Furthermore, the lack of capacity building for digital trade negotiations and the difficulty in repurposing digital market connectivity pose additional barriers. The absence of fundamental concepts such as fairness, transparency, and data sovereignty in discussions on digital trade rules is highlighted, along with the EU’s protection of its agrarian interests while expecting African countries to adopt rules set by US big tech.

The perceived bias towards the interests of developed countries and the influence of big tech lobbies in shaping trade rules further underscore concerns about equitable representation. The failure to address African countries’ development agenda and the unclear regulations surrounding AI in relation to digital trade rules are additional points of contention.

Overall, the dropping of demands by the US and the challenges faced by developing countries illustrate the need for a more inclusive and equitable approach to digital trade negotiations.

Arguments

Lack of global representation in digital trade negotiations is problematic

Supporting facts:

• If discussions are not held at a global level, we risk having a fractured approach, leading to silos.

• Countries might have to adopt rules not suitable for their development level or priorities.

• Representation across the development chain and regions builds legitimacy in negotiations.

Topics: Digital trade negotiations, Global Representation, Policy Interventions

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Digital trade negotiations need capacity building across different government ministries

Supporting facts:

• Digital trade issues are moving from the trade towards other agreements, necessitating a new mindset

• Development cooperation needs to be cognizant of this shifting landscape

Topics: Digital Trade, Government Ministries, JSI Negotiations

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Early stages of JSI negotiations were intensively fast-tracked leading to challenges

Supporting facts:

• The pacing and facilitation of JSI negotiations, especially in smaller groups, were intense and fast-tracked, leading to challenges

• Negotiations need to change their pace or format to deal with ‘parked articles’

Topics: JSI Negotiations, Geneva, Digital Economy

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Emma Savenborg noted the importance of U.S. data localization and its impact on digital economy

Supporting facts:

• Articles in the agreement are deemed important for businesses to trade

• Next phase negotiation might hold more controversial issues

Topics: U.S. data localization, Digital economy

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Report

The lack of global representation in digital trade negotiations is problematic as it can lead to a fragmented approach and the adoption of rules that may not be suitable for countries’ development level or priorities. Without adequate representation across regions and the development chain, the legitimacy of negotiations can be undermined.

This issue is particularly notable in Africa where limited resources and challenges related to the digital divide hinder participation in digital trade negotiations. However, it is important to note that this lack of participation cannot be solely attributed to being a Less Developed Country (LDC), as there are other factors at play such as a lack of skills in areas like hard infrastructure, regulatory capacity, and negotiation capability.

Limited resources also force countries to make difficult policy choices and the absence of global rules in areas beyond trade can discourage participation. To address these challenges, capacity building is crucial across different government ministries involved in digital trade negotiations.

As digital trade issues go beyond trade agreements, a new mindset is required in development cooperation to ensure all relevant ministries are equipped to handle the complexities of such negotiations. The early stages of Joint Statement Initiatives (JSI) negotiations have been characterized by intense and fast-paced discussions, which have resulted in challenges.

It is suggested that negotiations should consider adjusting the pace or format to address these challenges, particularly when progress is delayed or second phases of negotiations are necessary. This presents an opportunity to refine and optimize negotiation processes. The politicization of JSI negotiations is detrimental as it impedes progress and obstructs constructive discussions.

When negotiations become overly politicized, it hinders the exploration of productive ideas and compromises essential for successful negotiations. Emma Savenborg has emphasized the importance of U.S. data localization and its impact on the digital economy. Certain articles in the agreement are considered crucial for business trade, and more controversial issues may arise in the next phase of negotiations.

Savenborg advocates for active engagement in negotiations to enhance understanding and build trust among stakeholders. Learning from observing can be a beneficial approach during negotiations. Regional agreements are seen as a valuable learning experience informed by global-level discussions. The idea is that regional dialogues can benefit from insights and discussions at the global level, enabling better-informed decision-making.

Overall, the lack of global representation in digital trade negotiations, challenges faced by countries, the need for capacity building, the intensity of JSI negotiations, the politicization of negotiations, the importance of U.S. data localization, and the value of engagement and regional agreements are key points highlighted in this summary.

These insights shed light on the complexities of digital trade negotiations and provide valuable considerations for improving negotiation processes and outcomes.

Arguments

African countries’ reluctance to engage in the digital economy and Joint Statement Initiatives (JSI) is due to unfulfilled promises made at previous negotiations like the Doha round.

Supporting facts:

• African countries view their presence at the WTO through the lens of a development agenda, central to which are the promises made at the Doha Round.

• African countries insist that the issues important to them are already in the Doha agenda and should be resolved before new negotiations start.

Topics: Digital Trade, WTO, African States, Joint Statement Initiatives, Doha Round

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The insistence of African nations for a multilateral trade system and observes of the WTO rules.

Supporting facts:

• African countries stressed on the importance of preserving multilateralism and following WTO rules.

• They regard negotiations outside the purview of the WTO, such as the JSIs, as violating the concept of multilateralism.

Topics: Digital Trade, WTO, African States, Multilateralism, Trade Negotiations

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African countries are facing infrastructural and capacity challenges in engaging in the digital trade of the digital economy.

Supporting facts:

• A digital divide exists with different African states being at different levels of preparedness for the digital economy.

• Issues of infrastructure and lack of appropriate regulatory frameworks are primary among these challenges.

• Many African countries feel disadvantaged and unprepared to negotiate on these issues.

Topics: Digital Trade, African States, Digital Divide, Infrastructure, Capacity Building

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African countries have the urgency to negotiate their own digital regulations.

Supporting facts:

• Negotiating digital regulations at the regional level has always been part of the AFCFTA agenda.

• The protocol being negotiated aims to promote the emergence of African-owned e-commerce platforms at various levels.

• The surge in e-commerce and the rise of the pandemic brought to the forefront the importance of the digital sector.

Topics: Digital regulations, AFCFTA, African Union

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The protocol will be critical for achieving Africa’s economic e-commerce agenda and addressing the digital divide.

Supporting facts:

• Digital economy is relevant for all countries and it’s highly important for the African continent.

• The digital sector surge and the pandemic have further emphasized the importance of e-commerce on the continent.

• The protocol is expected to harmonize some of the trade rules to advance regional integration.

Topics: Digital divide, E-commerce, Digital economy

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AU member states should participate in all international forums where e-commerce and digital trade negotiations or discussions are happening

Supporting facts:

• Participation does not only entail participation in the WTO, but also in other forums where these conversations are happening

• A unified approach would provide better developmental outcomes that capture Africa’s overlapping challenges for different government mandates

Topics: Digital trade, E-commerce, International negotiations

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There is a gap in terms of the information during the negotiation process

Supporting facts:

• During the discussions, not everyone is invited to the table, causing information disparity

Topics: Negotiation Process, Regulators’ Paradigm

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Lack of trust exists among negotiators from the African countries

Supporting facts:

• African countries do not believe they are negotiating in good faith due to past experiences

Topics: Negotiation Process, Developing Countries

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African countries feel there has been no meaningful engagement in the negotiation processes

Supporting facts:

• It’s difficult for African countries to engage when other’s interests are elsewhere

Topics: Negotiation Process, Developing Countries

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Report

African countries have expressed reluctance to engage in the digital economy and Joint Statement Initiatives (JSIs) due to unfulfilled promises made during previous negotiations, particularly the Doha Round. They argue that these unmet commitments must be addressed before introducing new negotiations.

African nations emphasize the importance of preserving multilateralism and adhering to the rules of the World Trade Organization (WTO). They view negotiations outside the scope of the WTO, such as the JSIs, as a violation of the concept of multilateralism.

One major challenge for African countries in digital trade is the digital divide. Different African states face varying levels of readiness for the digital economy, with infrastructure issues and a lack of appropriate regulatory frameworks being the primary obstacles. Consequently, many African countries feel disadvantaged and unprepared to negotiate on these issues.

In response to these challenges, African countries are urgently seeking to negotiate their own digital regulations under the African Continental Free Trade Area (AFCFTA). They aim to promote the emergence of African-owned e-commerce platforms and address the digital divide. The AFCFTA digital trade protocol is considered crucial for advancing Africa’s economic e-commerce agenda.

This protocol is expected to harmonize trade rules and facilitate regional integration. Furthermore, it is believed that the AFCFTA digital trade protocol could have a positive impact on Africa’s e-commerce and digital economy. African Union member states are encouraged to participate in all international forums where e-commerce and digital trade negotiations take place, as a unified approach would yield better developmental outcomes that consider Africa’s overlapping challenges.

In terms of regulations, a one-size-fits-all approach is not considered effective for e-commerce regulations in Africa. Instead, a flexible approach that considers development capacities, digital readiness, and national contexts is advocated. African countries argue that taking these factors into account would result in more tailored and appropriate regulations for the African context.

The analysis also reveals disparities in information during the negotiation process, where not everyone is invited to the table, leading to gaps in knowledge and understanding. This underscores the need for better information sharing and inclusion in the negotiation process.

Moreover, a lack of trust exists among negotiators from African countries. Past experiences have led the African nations to doubt the good faith of negotiations. This lack of trust hinders meaningful engagement in the negotiation processes and calls for rebuilding trust and confidence among the participants.

To address these challenges, there is a need for increased capacity building for negotiators. Although there are initiatives to support negotiators, the presence of mistrust undermines the confidence of African countries in the effective representation of their voices. Strengthening the capacity of negotiators would help ensure a more informed and influential African presence in trade negotiations.

In conclusion, African countries are facing various challenges in engaging in the digital economy and Joint Statement Initiatives. The unfulfilled promises from previous negotiations, the emphasis on preserving multilateralism, the digital divide, and infrastructure and regulatory obstacles are all factors contributing to their reluctance.

However, negotiations at the regional level, such as the AFCFTA digital trade protocol, are seen as critical for advancing African e-commerce and addressing these challenges. The analysis reveals the need for tailored and context-specific regulations, increased information sharing, trust-building, and capacity building to effectively represent and address the concerns of African countries in the digital trade arena.

Arguments

Digital trade can be an effective tool to promoting greater inclusiveness

Supporting facts:

• Recent work at the OECD highlights that growing digital connectivity leads to more domestic and more international trade across countries at all levels of development

• Emerging digital technology is crucial for sectors such as agriculture, manufacturing etc.

Topics: Digital trade, Inclusiveness, Development

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Growing divergences in regulatory approaches risk further fragmenting the global digital economy

Supporting facts:

• Regulations are creating network systems that limits the global and borderless characteristic of internet

• The growing digital regulations are region specific which might lead to fragmentation

Topics: Digital trade, Global economy, Regulatory approaches

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Creating a global framework for digital trade is extremely important

Supporting facts:

• Internet is global and borderless and regulations should follow the same

• A global framework can avoid region specific network systems

Topics: Digital trade, Digital regulation, Global framework

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The complexity of issues in digital trade agreements is vast

Supporting facts:

• From the perspective of both developed and developing countries, understanding artificial intelligence and other aspects of the digital economy are a major challenge

• The vastness of these issues could lead to a siloed approach

Topics: Digital Economy, Artificial Intelligence, Trade Agreements

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Non-participation in digital trade negotiations by some countries makes them rule-takers, not rule-makers

Supporting facts:

• If you’re not at the table you’re a rule taker not a rule maker

• The dangers that this brings in all of this where countries might have to accept regulations that do not cater to their level of development or priorities

Topics: Digital Economy, Trade Agreements, Global Negotiations

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The legitimacy of global trade negotiations is threatened by lack of sufficient representation

Supporting facts:

• Negotiations will not be truly global or multilateral if a major portion of the world is missing from the decision making process

• Representation across the board creates legitimacy for negotiations

Topics: Global Negotiations, Trade Agreements, Digital Economy

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Lack of appropriate domestic policies can hinder international negotiations

Supporting facts:

• If countries don’t have a privacy and data protection regulation, it might be difficult for them to negotiate these issues on an international action or in different trade agreements

Topics: Domestic Policies, International Negotiations, Trade Agreements

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Digital trade being at your doorstep, which is a point observed not only in Africa but also in other OECD countries

Supporting facts:

• The African countries are negotiating their own digital regulations

• The AU protocol on digital trade to harmonize trade rules and promote African owned e-commerce platforms

• No global rules currently exist on digital trade

Topics: Digital Trade, OECD, AFCFTA, Trade Negotiations, Regional Integration

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The idea of digital trade for Africans, with rules created by Africans keeping developmental aspects in mind

Supporting facts:

• The AU is pursuing rules to regulate the digital sector

• The AFCFTA protocol to promote e-commerce and address the digital divide present in Africa

Topics: Digital Trade, African Union, Trade Regulations, Development

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Digital trade needs a holistic approach and knowledge building.

Supporting facts:

• Infrastructure and skills are important to the development of digital trade.

• Digital trade rules are not the only focus; work on aligning digital regulatory frameworks decreases friction and aids agreement on common rules.

Topics: Digital Trade, Economy, Global Trade

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Negotiating capacity, technical capacity, and implementation capacity need to be improved.

Supporting facts:

• Challenges of limited human and technical resources hinder the ability to seize opportunities in digital solutions and participate in the negotiations actively.

• Assistance via development cooperation can aid in gaining knowledge and implementing rules effectively.

Topics: Trade Negotiations, Digital Trade

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Growth in understanding the disciplines of digital regulatory frameworks is necessary.

Supporting facts:

• A learning curve can be walked gradually in terms of digital trade-related laws and their enforcement.

• The African free trade agreement serves as an example of starting regional and then expanding to continental and global levels for building up negotiating capacity.

Topics: Digital Trade, Regulatory Frameworks, Trade

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The need for more informal coordination on technologically challenging new issues

Supporting facts:

• Some of the mechanisms that we’re seeing in the digital economy agreements include non-binding rules. However, countries show a willingness to sit together and discuss these topics.

• The African continent has already laid a lot of policy groundwork for these discussions. Hence, the negotiations are not starting from scratch.

Topics: Digital Trade, E-Commerce, WTO Negotiations, AI and Trade, Digital Identities, Inclusion of SMEs

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There’s a lack of understanding and trust in what trade policy makers actually do

Supporting facts:

• Emma Savenborg pointed out that trade policy makers are no longer in the driver’s seat and must learn to adapt

• Trade policy makers are often viewed as potentially jeopardizing other regulations in negotiations

Topics: Trade Policy, Regulation

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There’s a large imbalance between the percentage of aid for trade that goes towards digital trade and the percentage of the economy that digital trade constitutes

Supporting facts:

• 0.4% of aid for trade goes to things considered digital trade

• Digital trade represents about 25% of the economy

Topics: Digital Trade, Aid for Trade

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Global regulatory frameworks rather than trades, regulatory frameworks, is important

Supporting facts:

• Mentioned that there’s a need for a global regulatory framework that can accommodate different approaches to data flows.

Topics: Global Regulation, Trade

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Artificial Intelligence needs special attention or exceptions in the context of trade rules

Supporting facts:

• He suggested discussing whether we need trade rules with special exceptions for artificial intelligence.

Topics: Artificial Intelligence, Trade Rules

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Report

The analysis focuses on the topic of digital trade and its implications for inclusiveness and development. It highlights recent work at the OECD, which has found that growing digital connectivity leads to increased domestic and international trade across countries at all levels of development.

This indicates that digital trade can be an effective tool for promoting greater inclusiveness. Emerging digital technology is also highlighted as crucial for sectors such as agriculture and manufacturing. It is believed that digital trade can significantly contribute to economic growth and development in various industries.

However, the analysis also raises concerns about the growing divergences in regulatory approaches to digital trade. It argues that regulations are creating network systems that limit the global and borderless characteristics of the internet. The increase in region-specific digital regulations poses a risk of fragmenting the global digital economy.

To address these concerns and maintain the global and borderless nature of the internet, it is argued that creating a global framework for digital trade is extremely important. The internet is seen as a global and borderless entity, and regulations should follow the same principles.

One significant issue highlighted is the low participation and engagement from developing countries in digital trade negotiations. This lack of involvement makes these countries rule-takers rather than rule-makers. Participation from African nations in discussions on digital trade at the World Trade Organization (WTO) remains low, and no low-income country currently has a digital trade chapter in their Regional Trade Agreement (RTA).

This lack of representation exacerbates the potential risks of accepting regulations that do not cater to their level of development or priorities. The analysis also emphasizes the complexity of issues in digital trade agreements. Understanding artificial intelligence and other aspects of the digital economy are identified as major challenges for both developed and developing countries.

It is argued that a siloed approach to these issues could hinder effective negotiation and implementation of digital trade agreements. Non-participation in digital trade negotiations by some countries is seen as a factor that makes them rule-takers instead of rule-makers.

The legitimacy of global trade negotiations is threatened by the lack of sufficient representation across the board. Lack of appropriate domestic policies is identified as a hindrance to international negotiations. Without privacy and data protection regulations in place, countries may struggle to negotiate these issues effectively on an international level or within different trade agreements.

The analysis highlights the unique challenges and opportunities for digital trade in Africa. The African Union (AU) is pursuing rules to regulate the digital sector and promote e-commerce. The African Continental Free Trade Area (AFCFTA) is seen as an opportunity to establish global rules of the game.

The AU protocol on digital trade aims to harmonize trade rules and promote African-owned e-commerce platforms. Currently, there are no global rules on digital trade, and the need for such rules in Africa and other OECD countries is emphasized. Digital trade is viewed positively as a means of promoting African development while considering the continent’s unique challenges and priorities.

The idea of digital trade for Africans, with rules created by Africans, is seen as a way to bridge the digital divide and ensure inclusivity. The analysis also suggests bringing AFCFTA discussions into global multilateral platforms as a means to establish global rules for the digital economy.

The harmonization of trade rules and multilateralizing regionalism is seen as a necessary step towards creating a supportive global trade environment. It is argued that a holistic approach to digital trade is needed, which includes infrastructure development, skills training, and alignment of digital regulatory frameworks.

Digital trade rules alone are not enough; efforts to decrease friction and agree on common rules through aligning regulations are imperative. Improving negotiating capacity, technical capacity, and implementation capacity is seen as paramount to fully seize the opportunities and benefits of digital trade.

Assistance via development cooperation is highlighted as a means to enhance knowledge and effectively implement digital trade rules. The analysis also emphasizes the need for growth in understanding the disciplines of digital regulatory frameworks. A gradual learning curve is encouraged in terms of digital trade-related laws and their enforcement.

Starting at regional and expanding to continental and global levels can help build negotiating capacity. The analysis identifies the need for more informal coordination on technologically challenging new issues in the digital economy agreements. The African continent is mentioned as having already laid groundwork for such discussions, which means negotiations are not starting from scratch.

Flexibility in international trade rules is recognized as necessary to accommodate the varying situations of different nations. However, it is also recommended to have some binding rules to prevent excessive uncertainties. The lack of understanding and trust in what trade policy makers actually do is seen as a challenge.

Trade policy makers are often viewed as potentially jeopardizing other regulations in negotiations. This lack of understanding undermines effective decision-making in trade policy formulation. Furthermore, it is highlighted that there is a large imbalance between the percentage of aid for trade that goes towards digital trade and the contribution of digital trade to the economy.

Given that digital trade represents about 25% of the economy, more attention and funding should be allocated to support its growth. The analysis concludes by emphasizing the need for a global regulatory framework that balances diverse country approaches to issues like data flows and privacy protection.

This lack of global consensus on how to regulate the digital economy underscores the importance of creating such a framework to provide convergence and facilitate trade. Additionally, trade language is recognized as playing a crucial role in managing the flexibilities of different approaches to data flows and in sanctioning protectionist measures.

It is seen as a useful tool in ensuring that all approaches to digital trade work based on international rules. Finally, the analysis mentions the need for special attention or exceptions in trade rules for artificial intelligence. This indicates that the unique challenges and complexities presented by artificial intelligence require specific considerations in trade rule formulation.

To summarize, the analysis highlights the potential of digital trade in promoting inclusiveness and development. It raises concerns about the divergent regulatory approaches that risk fragmenting the global digital economy. The importance of creating a global framework and increasing participation from developing countries in digital trade negotiations is emphasized.

The challenges and opportunities for digital trade in Africa are discussed, along with the need for a holistic approach, capacity-building, and a balanced regulatory framework. Flexibility in international trade rules, understanding of trade policy makers’ role, and the need for more support for digital trade are also highlighted.