Realising SDGs through policies enabling digital trade

Event report

[Read more session reports and live updates from the 12th Internet Governance Forum]

The session aimed to address how digital trade and ICTs can serve as tools to realise Sustainable Development Goals (SDGs) and to promote social inclusion. The panellists focused on six different areas: 1. What evidence based research reveals about the economic benefits of digital trade; 2. Digital Trade Rules; 3. Localisation Rules; 4. Users’ trust in the digital economy; 5. Business responsibility; 6. Best practices in Internet Governance.
 

1. Evidence Base

Ms Carolyn Nguyen, Microsoft USA, started by affirming that goods and services consumed currently contain inputs from different countries across the world. More than 50% of trade is digital services. Digital services are essential in traditional sectors, such as agriculture and manufacturing. For instance, technology used to measure moisture and the resulting data is important to determine how much fertilizer and peptides are needed to satisfy global demand. These capabilities allow farmers to make better decisions. ICT has impact on the SDGs.

Ms Rachel Bae, OECD, stressed that it is often cited that 10% growth in Internet connectivity can contribute 1.4% to GDP, but she argued that there is no hard data to measure this properly. There is a gap in the literature with evidence needed to prove that ICT does indeed promote and advance the SDGs. When the OECD tried to develop metrics to measure the growth impact of digital trade, it was realised that there is in fact no clear definition of digital trade. It can mean digitally ordered, platform enabled, digitally delivered goods, services, and information. The OECD is still refining the framework of digital trade.

Ms Helani Galpaya, LIRNEasia, confirmed that IT-enabled services are well documented in Asia and contribute from 7 to 10% to the GDP. ICT gave the opportunity to many who would feel normally intimidated, such as transgender people and women, to have work and part-time employment, for example in India, Bangladesh, and Myanmar. The most preeminent example is the translation platforms in Myanmar which pay $150 to $300 dollars a month, when the average national income is $80. Ms Karen McCabe, IEEE, noted that caution should be exercised in the development of the ICT so as not to increase the divide in societies.
 

2. Digital trade rules

Ms Esther Peh, Mission of Singapore to the WTO, underlined that the discussion of ICT and commerce is not entirely new, as it first took place almost 20 years ago. In the last WTO, stakeholders agreed on continuing conversations and maintaining the practice of not imposing customs duties on electronic transmissions until 2019. A second incentive aims to involve 75% of global trade members to quicken the pace of e-commerce discussions at the WTO.

Prof. Makoto Yokozawa, Kyoto University, emphasised the importance of balance between free and secure values in the discussions of digital trade. Ms Ellen Blacker, Private Sector, USA, agreed on the importance of setting up a policy framework that will allow local economic conditions to grow. Ms Audrey Plonk, Intel, stressed that understanding should be increased on how information, whether it is personally identifiable or not, may be used, sold or transferred. A lot of resistance to data flows comes from the lack of understanding. Ms Hossam ElGamal, Representing Government of Egypt, affirmed that privacy is a challenge in developing countries, where regulators are trying to encourage the progress of trade and data flow, but at the same time are concerned about citizens’ rights.
 

3. Localisation Rules

Mr Prof. Christopher Yoo, University of Pennsylvania Law School, stated that the study done by the European Centre for International European Economy (ECIPE) has estimated a loss of 1.7% in GDP based on proposed data localisation law. If there is an economy-wide localisation law, ECIPE estimated 1.1% loss to GDP. These are significant losses from the imposition of data localisation. After the implementation of the EU data protection directive in 2002, there was a 65% reduction in revenue. In data flows, business round tables come up with new business models, big data analytics, supply chain automation, digital collaboration and scalable cloud, all requiring the movement of data across data borders in a very different way, and which have been very poorly studied and often misunderstood.

In many cases, there is a loss of benefit to industry in the fourth industrial revolution. Ms Bae confirmed that data localisation is the same as introducing border controls. There are two types of localisation measures: cross-border, and data restrictions. These restrictions are applied horizontally across all sectors, and aim at personal data. There are also local storage requirements, which tend to be sector-specific in areas such as finance and health. In terms of local storage requirements, the negative impact is also across all sectors, except domestic, what might be called the data sector, or across the board competitiveness. In cross-border data restrictive measures, there was also a spill-over effect to neighbouring countries, and even if they didn’t have any data restrictions, they were impacted by their neighbours’ restrictive measures. In contrast, with local storage requirement measures, there was a very small, almost negligible impact on the neighbours. Given that the Internet is global and taking in the cost of regulation around the world, it would be to everyone’s benefit for the global economy to come together to find a homogenous solution.
 

4. Users’ trust

Ms Plonk stressed that we are going to need data to realise the potential of AI. It is not a zero-sum game where you have the data or you don’t. It either flows or it does not.  We need to be creative and think about solutions, such as having data in multiple locations. Ms McCabe underlined that stakeholders are starting to explore the possibility of ethics by design. There is a need to educate the technologists that are developing these standards and technologies about the implications of trust. There is a global initiative on autonomous intelligence systems.  This is a large body of work which aims to be looking at ethically aligned design, addressing many issues from privacy and security and ethics, even to autonomous weapons. A set of recommendations and guidelines for primarily the technical community and for policymakers are needed.
 

5. Business responsibilities

Ms Peh addressed a conscious effort and movement towards facilitation in areas such as electronic authentication, signatures, as well as paperless trading. A prime example being in customs procedures. Currently all customs procedures associated with shipment in Singapore are done online through a single window. This reduces the cost and time to prepare and process paper submissions and documentation and also allows clearance to be expedited. Businesses, particularly small ones really stand to benefit because it saves time and streamlines processes. In 2018, trade net will be upgraded to the Singapore trade platform, which will be trade map-plus in terms of features.
 

6. Best Practices in Internet Governance

Ms ElGamal concluded by stressing the relationship between governance improvements and realising SDGs. Businesses can also invest in ways to meet the SDGs. The promise of digital trade is a way to make development more possible. The regulatory frameworks just need to be adjusted to improve digital trade.

By Ana Maria Corrêa