Data flows and development

Event report

This session addressed the role of data flows in achieving the UN Sustainable Development Goals (SDGs), as well as potential policies enacted by international organisations and governments to ensure data flows promote development.

Ms Christine Bliss, President of the Coalition of Services Industries, began the discussion by providing statistics about the tremendous growth of e-commerce. She gave background information explaining the proliferation of cross-border data flows due to the increased popularity of mobile devices, Internet of Things (IoT), and other technologies. According to a study by McKinsey, the Internet contributed to 21% of GDP growth in the 13 largest world economies from 2007 to 2011, and by 2025, half of all economic value will be created digitally. Adoption of digital commerce is especially important for small and medium sized enterprises (SMEs), which are the backbone of developing economies. According to Bliss, cloud storage is particularly important because it can ‘close the digital divide’ between the developing and developed world, and democratise access to information. Bliss finished her introduction by citing examples of good data flow policies in Cambodia, which encourage innovation, versus bad data flow policies in Indonesia and Vietnam, which stifle innovation by enforcing data localisation requirements.

The discussion then moved to individual statements from panelists. Mr Gustavo Hector Méndez, Counsellor of the Permanent Mission of Argentina to the WTO, discussed his view on the new regulatory framework that should be provided by organisations such as the WTO to promote sustainable e-commerce. He argued that multilateral agreements such as General Agreements on Trade and Tariffs (GATT) within the WTO can ensure that developing countries are on a level playing-field with the developed world when it comes to data flow.

Mr Felipe Sandoval, Fellow of the International Centre for Trade and Sustainable Development (ICTSD), added that the interests of private industry and government are not always aligned when it comes to data flows. This divergence is particularly noticeable in Regional Trade Agreements (RTAs), which involve differing legal frameworks and market liberalisations between developing and developed countries. He argued that developing countries seeking trade deals must have strong domestic regulatory frameworks that can encourage data innovation. Likewise, developing countries can use this need for a legal framework as leverage in trade negotiations, essentially saying, ‘yes, we will liberalise our markets, but only if you help us with capacity development’. 

Mr David Weller, Head of Global Trade Policy at Google, gave the industry’s perspective about the role of data flows in trade. He walked through four main trade obstacles that the Internet has addressed: language, distance, resources, and disregard for rules. Machine translation services such as Google Translate, targeted advertising to potential customers around the world, big data analysis with minimal infrastructure, and data-based mechanisms for accountability have all addressed these four traditional challenges to trade.

The panelists then answered questions from Bliss and the audience. They discussed tangible examples of digital technology achieving the SDGs, such as the increased relevance of online education, but reminded everyone that four billion people in the world still lack Internet access. Likewise, discussions about proper regulatory frameworks highlighted the potential drawbacks of a one-size fits all model, although the role of multilateral arrangements was still appreciated. There was particular concern that by enforcing data flow rules from a top-down approach such as through the WTO, the needs of individual developing countries would be ignored, and therefore new standards must not restrict economically-beneficial data flows for developing nations.