31 May 2016

TiSA Ministerial Global Industry Statement on Digital Trade

TiSA Ministerial Global Industry Statement on Digital Trade

GLOBAL INDUSTRY URGES TRADE MINISTERS TO ADVANCE A DIGITAL TRADE AGENDA IN TiSA NEGOTIATIONS

Industry associations from around the world representing a multitude of sectors urge the Trade Ministers gathering in Paris, France, on the 1st of June 2016, for the next Trade in Services (TiSA) Ministerial, to advance a digital trade agenda in the ongoing negotiations in order to combat the increasing trend of digital protectionism.

The promotion and preservation of internet openness and cross-border information flows must be actioned as a matter of priority. Time is of the essence if we are to leverage the momentum of recent significant developments. The Trans-Pacific Partnership which includes, for the first time, comprehensive trade arrangements in support of Internet and digital services was concluded on 15 October 2015. In Nairobi, Kenya, expansion of the Information Technology Agreement (ITA II) was agreed in December 2015. After the second edition in twenty years time of the G7 ICT Ministerial in Takamatsu, Japan, last April and ahead of the G20 Leaders Summit in Hangzhou, China where the digital economy will occupy a strategic place on the agenda, it is imperative that this forum further advance the global digital trade agenda.

Digital trade is the new sea lanes and containers of trade. Trade is no longer possible without the flow of data and digitally deliverable services. Today’s world is entering in a new era of digital globalisation and innovation. The Internet is transforming how the world trades whilst similtaneously, boosting trade growth.

Despite recognising the strategic importance of digital trade, many WTO countries, paradoxically, are now requiring or promoting the localisation of data and information, and therefore digital goods and services. Such moves undermine the concept of modern digital trade. Recent studies indicate this trend raises costs for local firms, curtails economic growth, harms productivity in numerous sectors, and creates inefficiencies in global value chains. The WTO must challenge this trend of digital protectionism.

Global openness in the areas of telecoms and e-commerce and pressure against localisation is needed for WTO members to seize the opportunities of the Internet. If WTO members desire to seize the opportunities of the Internet, they must develop ambitious new disciplines related to telecoms, e-commerce and combating forced localisation. This approach would not prevent WTO members from pursuing legitimate public policy objectives such as national security, cybersecurity, consumer protection and privacy policies – as stated in the Article 14 of the General Agreement on Trade in Services (GATS). With this fundamental understanding, negotiations should proceed.

The upcoming meeting in Paris provides an opportunity for Trade Ministers to elevate digital trade as a global economic priority at the WTO – together with other international institutions such as the G7, G20, APEC, and OECD. Ministers are urgently encouraged to strongly support new trade disciplines in TiSA to combat digital protectionism which is recognised as one of the biggest threats for 21st century trade.

TiSA Members, all sharing a like-minded vision for the future of world trade, must lead by example. The world’s largest advanced economies must resist measures that isolate their own markets through forced localisation policies and actively work to encourage other governments to do likewise.

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