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IGF 2017 - Day 2 - Room XXVII - OF48 Digitalization and International Trade

 

The following are the outputs of the real-time captioning taken during the Twelfth Annual Meeting of the Internet Governance Forum (IGF) in Geneva, Switzerland, from 17 to 21 December 2017. Although it is largely accurate, in some cases it may be incomplete or inaccurate due to inaudible passages or transcription errors. It is posted as an aid to understanding the proceedings at the event, but should not be treated as an authoritative record. 

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(Captioner standing by for Webex audio feed)

>>  TORBJÖRN FREDRICKSSON:   . . . with the Internet policy world and that will be followed by comments from the different stakeholders and representatives on the panel and hopefully there will be sometime also for interaction in this session; but I recognize that the time is not on our side, I would say. So, let me start ‑‑ also, if there are any remote participants, you should be aware that we have the possibility to pose questions online.

So, let me start with the information in column (?) report.  This is the flagship report that is published nowadays every second year and this one was released in October this year so it's still relatively fresh and you will find the summary of the report out there but the full report is available online, of course.  And this year we were fortunate to have the financial contribution from UK government, which makes me particularly happy, proud to have Ambassador Braithwaite with us this morning.

So the message that we're bringing out with this report really is that we are on the cusp of a new digital committee.  We have paid a lot of attention in ANTA to the growth of e‑commerce, but we see that the technological developments here are really much broader based and we see that this has important implications for virtually all of the sustainable development goals which forces us to give more attention to this area, not least in the context of our various development initiatives around the world.

And we know the areas that are affecting this, through the increased use of automation, robotics, increased use of artificial intelligence, the Internet of Things, data-driven cloud computing, et cetera and the message.  From the report is most importantly that these changes are transformational.  They will influence all countries in different ways.  They influence it by creating new opportunities but also new risks and challenges.  And the report highlights some of these different things but the most important message, really, is that the impacts of the digital transformation will very much depend on the readiness of countries to deal with them, both to harness the opportunities that are created for connecting entrepreneurs, small businesses with new markets; new business models that will enable nor people to engage in global value chains; but also to cope with the challenges.  And we will touch upon some of them in this morning's presentation.

More importantly, it also means that in order to raise the preparedness or the readiness to deal with the digital transformation, we need a concerted, holistic and cross‑sectoral as well as multistakeholder approach to policymaking.  It is very difficult for governments to cope with the rapid speed at which the digital economy is evolving and therefore it's very important that governments at the national level but also at the regional and global levels have good interactions with the other stakeholder groups, with the private sector, with the civil society, technical and academic community as well as with different players among the international organisations.

In the report we highlight some of the numbers that really testify to the growth and the rapid speed at which the digital economy is evolving; but at the same time we highlight that the lack of statistics on this phenomenon is really a problem and this is particularly acute in developing countries.

Although we see that there are various official statistics available and some private sector data that are coming up with various estimates, we can see that, for example, global Internet traffic is expected to be about 66 times higher in 2019 than in 2005.

We know that about 100 million people at least are employed only in the ICT services sector.  We have seen rapid growth in ICT services during a period when trade has really not grown very fast. 

And perhaps what's more interesting from a development perspective is that, if you look at where all the new entrance on to the Internet and potentially also in the (?) of e‑commerce and other forms of digital economy transactions, most of them are coming from the developing countries.  So, 90% of the 750 million people that went online for the first time between 2012 and 2015 were from developing countries, led then by India and China.

But while we are seeing this rapid growth we also know that there are major gaps.  Still 50% of the world is still not online and in the least developed of the countries there is only one in six that are actually using the Internet right now.  And not only between countries, we have large gaps within countries.  We have the familiar gender gap, we have gaps between rural and urban areas.  We have gaps between the larger and the smaller firms.  And while micro and small businesses stand to gain a lot from increased digitalisation, being able to perhaps circumvent the middleman and being able to connect directly end‑to‑end to clients, they are the least prepared.

And they often doesn't have good knowledge of how to make use of the digital opportunities.  From the trade perspective, then, we document many different ways in which the Internet can enable more inclusive trade, basically, allowing more stakeholders, more players, more enterprises to connect to markets.  And we also are seeing this ‑‑ you know, this tendency towards micro tasks that can be delivered online that were simply not possible before you had the kind of Internet connectivity that we are having today.

Digital technologies is enabling us to cut and streamlining supply chains.  At the same time that means also that those that control the supply chains gain even more power over those supply chains.  And what we are seeing is for companies that want to engage in e‑commerce or rather if companies want to find customers when customers increasingly look for their good and services online, if you are not online, you become increasingly invisible in the market as a whole.

And that has potential big implications for economic opportunities, economic growth and development.  We also stress, however, that digitalization does not remove all barriers to trade. Many of the traditional barriers to trade will still remain.  If you do;t have the productive capabilities in a country, having access to the markets will not help you unless you have the goods and services that will be marketable in the market.

The report also highlights the jobs and skills challenges related to digitalization and we highlight four different ways in which digitalization is expected to influence the labor markets.  The first is that we will see the growth of many new jobs and occupations that were simply not there.  You have examples of e‑commerce platforms that are pure‑play; they only work when you have the internet functioning.

You have the production of various ICT goods, like printers, servers, chips, what have you.  That is likely to expand.  You have also new jobs related, for example, data analysis and various Big Data‑related activities.  And the like.  At the same time, a number of jobs will disappear as a result of automation.  And there are some studies reciting from the ILO, for instance, that are quite alarmistic, looking at Southeast Asia, highlighting that in the Phillipines, maybe up to 90% of the business process outsourcing jobs are at risk due to automation.  They are not saying that all of them will be gone but they are potentially affected by automation.  This can be seen in a number of labor‑intensive activities, textile and clothing, small‑scale manufacturing and others.

The third area is that the conditions of work will be affected.  We can expect more competition and therefore ‑‑ and more people potentially supplying services in the market, which will lead potentially to a greater risk for a race to the bottom at the global level.

And finally, we will see that more work will involve digital skills.  It' not just confined to the ICT sector or the digital sector; but even a lorry driver will, for instance, be expected to be able to manage a GPS.  You will see that the ICT is creeping into more and more activities around the world and across sectors. 

So this will require a different type of skill sets.  We see that the countries will increasingly need to develop at the base of this pyramid the digital user skills.  That will be needed for people to find a job; but also to take advantage of the opportunities as a citizen in the evolving society.

There will also be a need for more digital specialist skills that are actually producing ICT‑related goods and services.  And then at the top of the pyramid we see what we call e‑business skills which is really the ability to transform digital skills into business opportunities; being able to transform the business models of a company.  Often it is not enough to introduce ICT; you also need to adapt the way you do things to take advantage of these ICTs.

We also are noting, for instance, that we already have big gaps in the market for certain skills.  There is about an estimated 1 million cybersecurity job vacancies right you in the world and this is expected to grow another 50% until 2019.

Then there are other areas such as data scientists, which are in short supply right now but it is increasingly important for all sectors to take advantage of this.

This is the theme and chapter five of the report that I think will be most discussed in today's discussion.  We highlight that, as more and more trade activities go from offline to online, it means that when governments start negotiating further trade policies in these areas, they will give increasing attention to the role of data flows and all digital transactions; digital trade, digital services.  And that means that it becomes increasingly important for governments to understand not only how trade works but also how the Internet works.

And here we are highlighting some of the critique that has been expressed by various stakeholder groups to the way that trade negotiations that have dealt with data flows have been received. 

One of the cultural clashes here is that trade negotiations are very much done in a government‑to‑government, state‑to‑state fashion; whereas the Internet discussion, policy developments are much more multistakeholder. 

So, what we are looking at here, mostly when we meet at the IGF, we have a lot of Internet policy expertise in the room.  Maybe not so much trade policy expertise in the room.  And when we were last week in Buenos Aires for the ministerial conference on WTO, then we had lots of trade policy expertise but not so many representatives of the Internet community.  This is one of the things we raised in the report:  How can we bridge this gap between these two worlds?

Finally, the report looks at the multi‑faceted policy challenge here.  E‑commerce digital transformation in the evolving digital economy, really requires this cross‑cutting interaction between the different stakeholders at national, regional and global levels.  We are highlighting the need for better statistics, better measurement in this area.

It's very hard for governments in developing countries to come up with good policies if they don't know exactly what's going on in the economy.  And, as you are aware, very few developing countries collect relevant statistics on, for instance, on how many enterprises are using the Internet, how are they using the Internet for e‑commerce and so on.

And when we look at how developing countries cope with this, we are a bit concerned, to say the least.  It's a fast‑moving digital economy.  We have tremendous gaps in the extent to which countries and enterprises are ready to engage in this and benefit from it.  And at the same time dealing with it is a huge challenge because of the cross‑cutting nature of policymaking.  At the same time, we see that the amount of assistance that is devoted to this area, for instance, in the context of aid for trade, is declining.  It has dropped from about 1.2% ‑‑ sorry ‑‑ 3% about a decade ago to only 1% today.  And we see this is going in the wrong direction. 

So, we also call on the development community to see how we can scale up our support in different ways to developing countries in this area, to cope with both the challenges but also be able to seize the advantages.

And our e‑Trade For All initiative which I will not go into here, but is also seeking to make our combined efforts more effective.

And we have now 27 international organisations joining forces under this umbrella.  And there is also a strong private sector element to that, which is called the Business for e‑Trade Development.  And let me end with this commercial slide to call your attention to the next e‑Commerce Week, that will be held in 2018, which will be focusing specifically on the development dimensions of digital platforms, where we think we can continue this dialogue here in Geneva for a whole week.  We will have also a lot of parallel platforms, so if you areInterested, let us know, the Secretariat. 

This year we will also have in parallel with the e‑commerce week the second session of the intergovernmental group on e‑commerce and the digital economy which is a very important opportunity now for member states from all parts of the world but in particular the developing countries to engage in experience‑sharing and discussions about the many critical issues that they are facing to prepare for the digital economy.  And that wraps up my presentation.

And I would like to ask Bill to take over.

>> WILLIAM DRAKE:  Thank you very much.  Good morning, everybody.  Well, as somebody who has been involved to varying degrees with trade policy and digital networks since the 1980s and involved with the multistakeholder Internet governance processes since the late '90s, I am kind of really pleased to see that an organization like UNCTAD, that has a historic mission of helping developing countries participate more effectively in the world economy, is interested in the question of how do we begin to bring together people from the Internet and trade communities to work more effectively.  And I want to speak just a little about that and then we will go to the panel to offer further thoughts on this topic.

You know, the bottom line here is this is a process point that I am going to be speaking to and it is not really a question of whether or not one favors or doesn't favor any particular kind of digital trade outcome.  The question is on a procedural point:  Can we find ways, do we need to find ways to bridge the gaps that exist between these two communities?  And I would argue indeed that we do.  And that argument is articulated, as Torbjörn said, in the report.  A brief historical context:  If we go back to the early 1980s, you have the development of an expert community, a community of expertise and practise that was very focussed around these questions of electronic networks and how they impact international trade.  There were various types of debates going on at that point around transborder data flows, around the evolving nature of the services economy; and the question of whether or not one should begin to reimagine a lot of the traditional fields like telecommunications as involving traded transactions, rather than jointly provided services as they had historically been regulated under ter ITU instruments and so on.

And that expert community that came together included both people who had material interests in the outcomes but also people who did not; simply trade policy expert the, academics and so on.  They had, I think, a demonstrable impact on the outcomes of the Uruguay round and thinking about how to think about trade and services in a network environment and the development of the whole notion in the general agreement on trade and services of a network‑based delivery of services, et cetera.

And what's interesting to me is that, as we moved from the world of private, proprietary networks running over a proprietary platforms towards the Internet environment of a more open and globally‑integrated infrastructure, that community really didn't continue to engage on the Internet side of the discussions.  And at the same time it became very difficult to bring trade discussions into IG spaces. 

I remember during the WSIS negotiations when I was very involved in the civil society coalition, that we tried on a number of occasions to get language put into some of the declarations and the outcomes of the WSIS about trade and they were consistently sort of pushed aside by people who thought that shouldn't be there. 

So, in consequence, we had this kind of situation where we have had two different communities that have been increasingly, over time, taking on more and more the issues around digital commerce, electronic commerce over the Internet, from very different perspectives, based in completely different institutional environments, with different modes of operation and so on, who are not communicating effectively, not engaging with each other very much.  And I think that this is problematic in the contemporary context. 

As we have seen in the past five years, this sort of slow movement of negotiations around global electronic commerce in the WTO have meant that a lot of the energy has moved into preferential trade agreements such as TISA, TTP, TIPP, bilateral agreements and so on.  And the WTO process has been quite bottled up.

Now, at the meeting that Torbjörn just came from in Buenos Aires it happened that governments try to pursue a two‑track approach now dealing with the digital trade issues.  On the one hand you have an agreement to continue to work on some of the issues in the context of the existing framework of the WTO and the different groups that are gathered around that.  But there was also a joint statement on the part of 70 countries, including over 20 developing and transitional countries, a number of Middle Eastern countries and so on, that said we want to enhance the work of the WTO on global electronic commerce with an eye towards future negotiations on trade‑related aspect of electronic commerce; and they're beginning a process in the first quarter of the new year, to begin to take these issues on.

This will be a self‑run group; not an official WTO body.  Probably more formalized, though, than the traditional informal friends of processes in the WTO.  But they clearly have the intention to drive these things forward. 

Now, whether or not anything can actually result on a broad‑based, multilateral basis in the WTO, particularly in the context of a single undertaking, where you' trading off concessions on Internet issues for concessions on you know access to the market in textiles or bananas or whatever.  I don't know whether that will happen or we will end up instead with a plural lateral agreement that involves essentially those governments willing to engage on these issues.  Either way, it is clear the trade community is looking to move further toward establishing binding treaty obligations with regard to commerce over the Internet and the flow of information and data over the Internet.

And so, the question is, then, can we do this effectively?  Can governance do this effectively without the engagement of people who come from the Internet governance stakeholder communities?  I would argue:  No.

But the problem is that people coming from those environments tend to have a really different outlook, a really approach to the way one does things.  If you come from the iStar community, the ICANN or the regional Internet registries or even those of you involved in the IGF, the approach in those contexts has been peer to peer, fully equal footing participation by all parties. 

So, civil society people sit at the table next to people who represent multi billion‑dollar corporations and next to people from ministries and so on and engage in a process of discussion, reasoning, arguing and so on and  do so in a manner that is very transparent, involves a lot of remote participation from people around the world with a real bottom‑up kind of approach.  And this is really fundamentally very different from what goes on in the trade world.  And so, people in that community have become increasingly critical of what's going on in the trade community.

Mention was made about the Global Commission on Internet Governance chaired by former Swedish Prime Minister Carl Bildt.  It came out and said that the way the trade community is engaging on these issues, that historically had been part of the Internet governance landscape, whether it's encryption, censorship, transparency, data localization and so, on was problematic because of the closed nature of these processes.  And there have been other groups that have made similar sorts of pronouncements.  Moreover, people from the Internet communicties have problems with substantive outcomes that have happened from the preferential trade negotiations with issues like privacy, intellectual property and so on.

So, the worry is that the trade process could go forward on an intergovernmental basis with people who are skilled at trade negotiations but who are not deeply embedded in a holistic understanding of the Internet and the way the Internet works in a ‑‑ in the global information economy.  But beyond the economy, also as a fundamental catalytic force for socio economic development. 

So, the idea is here from our standpoint, we need to begin to build bridges; we need to be able to find ways to expand the interface these these two groups.  And there are different opportunities to do this. One of these is, at 10:40 today we have a new dynamic coalition on trade and the Internet, which will be meeting in room 12, which is going to start to talk about how trade issues can be dealt with in the context of IGF and related processes.  There is the UNCTAD e‑Commerce week that Torbjörn mentioned.  And I will also mention that I am working on a project for the World Economic Forum.  We will have a workshop later today at 3:00 p.m. on data localization and barriers to cross‑border data flow, in which context I make an argument that we need to broaden the process out essentially pursuing three parallel tracks of activities.  That work should be done in informal, normative governmental settings where you can reach agreements, I would argue, more easily than in the context of high‑intensity trade negotiations around treaty commitments; but yet you can also, if you have proper surveillance of the extent to which parties live up to commitments and so on and reporting, et cetera, you can encourage movement towards some shared focal points. 

A second track of activity that would involve multistakeholder processes where we could try to bring together all of the parties including those that don't support certain types of trade outcomes, to have a more inclusive dialogue that could inform and feed into the trade process;

Then thirdly, a track of existing trade processes, but hopefully done in a more open manner.  In particular, I would argue, while government ‑‑ and I will stop:  Governments will always tell you who are involved in trade negotiation, that you can't do the trading of concessions for market access in an open public space.  That, you know, if Country A is saying I will open my market and financial services in exchange to access to your market in bananas, you don't want to do that in public.  But there is no reason in my mind why the design of the rules of the game that shape those overarching market access commitments can't be done in a more inclusive, more open manner.

So, we believe that, trying to boot up this kind of conversation would be really important; and I would argue:  Data localization and barriers to data flow are a good place to try to start that conversation because this is an issue set on which you think people from the Internet and the trade communities may have some shared interests with regard to preserving an open Internet as much as possible.  So I stop there and we turn to our panel for further thoughts.

>> TORBJÖRN FREDRIKSSON:  Thank you, so much, Bill.  Let me turn to Ambassador Braithwaite.

>> JULIAN BRAITHWAITE:  Torbjörn, thank you very much.  I was going to start off where Bill had ended up, really, which is with this culture clash between the multistakeholder Internet governance communities and the intergovernmental trade communities. 

And I'd also like to pay tribute to Torbjörn and the work UNCTAD does actually in bringing people together more than I think almost any institution I know.  And I deal with every institution in Geneva.  All the way from the World Economic Forum to the WTO. 

I will perhaps make three points by way of introduction.  I think, first of all, it's worth remembering the founding principles of the Internet remain as relevant today as they always have been:  Openness, freedom and security.

And that should be our starting point.  And the second point is that actually the lack of intergovernmental rules is one of the reasons why the Internet and the digital economy have taken off.  Next year we will celebrate the Twentieth anniversary of the e‑commerce work program in the WTO.  It has gone nowhere. 

And it is a good thing, I would posit.  Because when it was introduced in 1998 we still had dial‑up and Facebook and Uber; and much of sort of extraordinary exploitation of the Internet as a commercial and economic proposition, hadn't even been thought of.

Meanwhile, we have seen the investment the multistakeholder model in that period which has actually provided a framework through WSIS ‑‑ the network created allowed us to bring together all of those essential to the development of the Internet and its exploitation in those years.

Third point, this point about 50% of the world's still not connected:  The extension of the Internet in the digital economy still largely rests in the hands of domestic policymakers.  

I think it is important to underline that.  This is about what governments do all around the world in terms of things like telecom regulations and deregulation and about a regulatory environment that is pro‑competitive and that encourages investment and about social educational policies that build capacity and personal opportunity.  That is actually what matters; not the intergovernmental rules or what the multinational companies do.  If you want to really want to extend the Internet, those are the things that matter.

So, what is the multilateral role of the trade community in all this?  Does it have one at all?  And I think we can point to the work that, for example, UNCTAD's work on capacity‑building, e‑trade facilitation.  The e‑trade foreign initiative. That's been very valuable.  Clearly there is a role for rules that for increase trust and security for cross‑border e‑commerce.  And in particular there's the point that Bill made:  What we can do to prevent the fragmentation of the Internet, prevent the data localization, the barriers to data flow, often driven by well‑meaning public policy initiatives to, if you like, in ‑‑ regulate public policies in noneconomic fields on the Internet.  You know, child protection online, privacy, all of these drive well‑meaning people towards data localization. 

And those are people who don't deal with the economic consequences or unintended consequences of those policies.  And you need to have a framework that doesn't lose sight of the enormous unintended economic consequences of pursuing well‑meaning public policies in other areas online which would lead to localization and fragmentation on the Internet. 

To conclude, I think there is a culture class between the multistakeholder model and intergovernmentalism.  It is actually now worth tackling this and ensuring the trade community and the rules of trade do address the challenges of digital trade.  But I think, actually, the positive thing of coming out of what was otherwise a very disappointing conference in Buenos Aires last week, is actually this flexible pluralateral process where so many states have come together to look at what rules there should be in the trade system to underpin digital trade but to do so in a flexible way.

And I think, one of their, again, their Best Practices founding principles should be to do so in a way a bit alien the way the WTO normally works and to bring in actually the very self‑same stakeholders so essential in the development of the Internet today.  Thanks so much.

>> TORBJÖRN FREDRIKSSON:  Thank you so much, Julian.  And thank you for participating here.  This illustrates also why Geneva is a good place to have this dialogue:  Because we have people like yourself that actually deal with both the Internet issues and the trade issues.  You don't find that in any other cities, among the government representatives.  So I think that we have in Geneva a unique collection of institutions that can bring a very valuable perspective to these issues.  Thank you so much.  Let me now turn to from Tarek Kamel from ICANN.

>> TAREK KAMEL:  Thank you very much for the invitation.  Good morning, everybody.  I want to build on what Bill and what Ambassador Braithwaite have said and and start by sharing observations with you a few observations for the overall internet system governance that is affecting the debate of today. 

The first fact is that technology is evolving very fast from the Internet of things, to blockchain, to artificial intelligence and even the current technologies that we have known for many years are also taking us forward very fast.

This is the second fact:  That this is affecting different sectors.  Not anymore the Internet sector but different services sector.  For example, we see that very clearly in the transport sector and inn the financial sector as well as in the tourism sector.  We call it the uberisation of the economy.  It is not in just one sector but it is covering different sectors.

The fact is the technology evolution is much faster than legislation‑making machines in any government or any Parliamentarian environment.  I hope you agree with me on that as such (chuckling), as such. 

The fourth fact:  The next 2 billion Internet users are coming from what we say Global South:  From India, China, Africa and different parts of the world.

How does this affect the governance model of the trade and the Internet and trade services and the Internet?  All of these observations affecting the evolution of that is definitely a good question.

Ambassador Braithwaite has said the clash between the multilateral environment and the multistakeholder environment ‑‑ and I want to soften it a bit, that there are some interfaces and there are some bridges that are starting to be built between these two different environments. 

In ICANN, for example, we are, for twenty years now, almost two decades, practicing the multistakeholder model as a decisionmaking process in a technical remit (?) in a limited technical remit (?), which is the technical coordination of technical identifiers, specifically the domain names; and in cooperation with the RIRs and in the iStars (?).  

It's working,  it's working well, to a great extent.  I am not saying it's perfect but it definitely has evolved over the years, it has delivered the IANA transition process within the last two years in a global process that was really very Inclusive.  And, with a deadline, it has delivered the new gTLD program with the internationalised domain names.  And we have seen the community has come up with a new governance model that empowers the community that provides additional accountability as well for the operation of ICANN and that makes sure that the global communities really has oversight as much as possible. 

It is definitely not without challenges.  Because sometimes decisionmaking in a multistakeholder process takes time.  And globalization in the multistakeholder process is also definitely an issue.  To be completely inclusive from different parts of the developing world in complex issues is definitely not an easy thing.

But it shows, definitely, that ,still, there is a need for newcomers to come in; there is a need for further capacity‑building programs that we are doing for newcomers and the government advisory committee as well as in the domain name constituencies from the underserved regions in a demand‑led engagement.

Where is the bridge and interfacing really coming in that?  It's not only in the decisionmaking process of naming and addressing; but we see that new challenges in the Internet governance arena are touching on ICANN's remit and therefore we are involved in automatic issues.  Privacy and data protection have been mentioned. 

So we see a challenge when it comes to GDPR when it comes for ICANN to be included really in the debate and ensure that the contracted parties that are running the Domain Name Systems over the world and in Europe are really compatible with the new regulations in Europe and elsewhere when it comes to privacy and data protection. 

We see it in jurisdiction.  More and more voices are asking for a domain name resolution, dispute resolution based on different jurisdictions.  We see it in cybersecurity.  For example, debates that are happening in different parts of different fora with the DNS and intellectual property.

So I would claim that there is a growing need to build these bridges, as Bill has rightly said.  ICANN has been trying as much as it could to demonstrate how do we participate in discussions in other fora, international fora that exist within our realm and how we invite as well within the GAC and the other constituencies, global fora to participate in the discussion and decisionmaking process.  So it needs effort and it needs investiment, but I think the multistakeholder process definitely has its attractions and is taking us forward.  Thank you.

>> TORBJÖRN FREDRIKSSON:  Thank you so much, Tarek.  And I must commend the speakers so far for keeping to the strict deadline we have to work under.  And I think this privacy protection of data is most important.  It is not just related to the trade only; it crops up in human rights and other policy areas also discussed here in Geneva.

And I think we should keep in mind here that this data protection issue is hard for all countries, even developed countries.  But in many developing countries, more than half developing countries, there is no data protection in place. 

Okay.  Let me now turn to civil society stakeholder participants here, Anriette ;and then I will go to Marietje.

>> ANRIETTE ESTERHUYSEN:  Thank you very much Tobjörn.  I would like to comment in two areas, looking a little bit at the processes that have been discussed then reflections on the report itself, which is a very valuable piece of work.  I think the processes, there are concerns, I think, from a civil society perspective.  Lack of transparency is one. 

The trend ‑‑ the collapse of international negotiations actually increases that; and that so many e‑commerce and digital trade agreements are done bilaterally, with small clubs of countries, just reduces that transparency.  And bill has already mentioned that.

There is also the issue of the lack of inclusion.  We had the recent issue of civil society being excluded in Buenos Aires.  But even at national levels, e‑commerce or policy development, it tends to be very limited and particularly in developing countries, those practitioners, the small businesses, those people looking for economic opportunities through the digital economy, are not at the table. 

And then there is also, with these preferential trade agreements, there is the risk that sometimes developing countries are pushed into accepting practices or agreements that don't allow them to be flexible in how they respond to local economic contexts.  So they get tied into practices which could, in fact, have a negative impact at a later stage.  Then, I think ‑‑ Tarek has  mentioned data protection.  I think there is a trend in these processes not to look at that adequately.  Again, in LDC's, the data protection needs of citizens are not affected ‑‑ considered.  When they are considered, it is usually the data protection interests of large multinational companies.

And then I think the other trend which is a concern in these processes is that critical Internet‑related areas of policy and regulation are not adequately integrated, like network neutrality; anti‑market regulation that would ensure more competitive practices; lower barriers to entry and addressing the fact that so much of the digital economy is relying on huge monopolies.  We have platform companies on the Internet which are the largest monopolies we have ever seen and so much of the digital economy is actually depending on them.  But to what extent are they also a barrier to more diversification and more opportunities in developing countries.

But I think some of you have touched on this:  On the report itself, I want to just share some comments from David Souter, who is from ICT for Development Associates.  A consultant who works this is this area, works with ABC, has a column called Information Society For All.  He also does work with UNCTAD.  And he had some very useful reflections on the report.

I think the first thing is that not everything is going digital.  So, when we look at the digital economy, let's look in the context of how it impacts the existing economy.  We have had comments on job losses.  But is the existing economy being strengthened?  Is it able to adapt?  So, looking at that connection is important.

Secondly, there are domestic and international contexts and we need to look at regional contexts as well.  Is digital trade cross‑border with inner region or is it generally north‑south?  Are economic regions being strengthened through this?  Africa, for example, there is very little cross‑border digital trade.

Thirdly, the digital economy is not a panacea.  I think that the report does highlight that.  And there is actually a risk of more exclusion.  And least‑developing countries could potentially fall behind with this transition.  But that does not mean that they can ignore it.  That means they just have to tackle it, find ways of addressing it and not being further excluded.

And then, fourthly, policy intervention also needs to look at trade and skills in ICTs.  And I think that has been highlighted as well.  So for policymakers, they need to look at broader cotext, not just the e‑commerce commerce.  What are the human and institutional capacities that will strengthen that. 

Then he also talks about not underestimating the pace of change.  So, just going forward he make I think useful discussions:  Look at positives and negatives.  Deal with data deficiency.  We still don't know enough, actually, about what the impacts are and that is why this report is important. 

And then:  Understand what is happening.  Talk with multiple actors about what the impact is.  And then unpacking the detail.

So I think we still tend to come at this in a way where we have certain assumptions about where the world is going, where technology, where the Internet is going.  But to really understand how this is affecting economies that are already contrained, we actually need a lot more detailed research. 

>> TORBJÖRN FREDRIKSSON:  Thank you, Anriette.  Pass on our thanks to David as well.  Marietje, you are the next panelist.

>> MARIETJE SCHAAKE:  Thank you very much.  Good morning.  I hope there's time for your questions as well.  So I will try to be brief. First of all, let me thank the initiators of this panel.  I think it's very important to look at how to bridge the gap between the worlds of trade, foreign policy, and diplomacy.  In fact, it is the work I am involved with in the European Parliament. 

And just to zoom out for a second and look at the moment in which we are meeting and talking about these important topics.  I think the multilateral system, universal principles and values and rights as well as openness are under extraordinary pressure.  And we need to really see that bigger picture in order to understand what our priorities should be.

I want to echo what Anriette said about the fact at the WTO meeting but also the GCCS in India.  Civil society participants were not given visas, were not accepted.  And I asked parliamentary questions about it and I was happy to see the European Commissioner for Trade pushed back against that as well.  It only goes to show that it is not a given, to even have a multistakeholder model.  I mean, here is the norm, idea and a broadly shared principle but it's not globally.  We should understand that it is still a battle, if you will.

So, my comments are are obviously from a EU‑centric point of view.  I am a member of the European Parliament so I look at ways in which the EU can lead in this space.

And I think that the participation of many, including civil society in trade discussions as well as transparency have significantly improved over the past couple of years.  The EU is really showing what can be done to create more inclusiveness as well as multistakeholderism in this.  You will see this also in the Trade For All strategy, which is the blueprint or the framework that the European Commission works with; and also when we look at the digital agenda, I think it is clear that the EU is a normative rulemaker.  When you look at enshrining net neutrality and law, when you look at the general data protection regulation, when you look at tax rulings being scrutinized and refined, you really see that there is a normative way in which the EU looks at what should be done as a set of rules in the digital economy.

So, when I started looking at what the EU's position should be on digital trade rules, it was also very much about the relationship between what we do domestically, how it reflects internationally and also what happens in nationally and reflects on us in the EU, which is not entirely domestically, but you know what I mean.

It's true, as Tarek said, that digitalization is moving very fast and the democratic decisionmaking at least in no way can keep up.  And I don't think authoritarian decisionmaking can either.  So it's important to think in terms of principles and frameworks where innovation has space but where principles are reserved.  I think it is essential to recognize how much size matters; how much standardization in a significant market can impact the way global standards look.  How important it is in this moment in time to put the public interests first in looking at that and to recognize that it's also globally skilled companies increasingly involved in setting norms, in dictating through their terms of use, the choices they make, the choices their algorithms make.  What is acceptable speech and what is not?

So, it is really important to know that we are not as policymakers, as public policymakers, the only ones looking at ruleses, looking at norms.  There's a lot of de facto norm setting already.  A lot of rules are already evolving even without public or democratic intervention.

So the question is really:  Can we be rulemakers or are we going to be forced to be ruletakers?  And the importance of standards also in trade cannot be underestimated.  We have to look at how we avoid that weakest links in the Internet of Things devices poison entire systems.  We need to push back against forced data localization which hinders trade but certainly enables authorities to look at the data of citizens, often for control and repression.

So, what I have been working on recently and I was glad there has been a broad majority in the European Parliament supporting this, is to call for an EU strategy on digital trade rules where we make very clear that protectionism is undesired but data protection is entirely legitimate.  So, it requires companies that want to do business in the EU to respect European rules and it also looks at what is needed for adequate protection in third countries before we can engage in trade agreements.  We also call for the criteria to more predictable and transparent so they are not arbitrary.  There are other areas where the EU is taking the lead.  We are sharpening the rules on the exports of surveillance technologies and are assessing those exports for the potential of human rights violations and companies that would risk violating human rights through exporting encryption ‑‑ sorry, surveillance systems, would not get a license if the human rights risk is considered too grave.  On the other hand we want to remove encryption as a control technology from dual‑use lists because it actually helps people protect their data and should not be controlled the same way, as, say, a weapon or a surveillance system.

To conclude, I think digitalisation is going very, very fast.  It is not a matter of whether we can stop or facilitate this kind of trade.  It's happening.  It's happening with or without, you know, our engagements in many ways.  But what we can and should do is see how we can ensure this trade happens in a framework of rules that are looking at fundamental principles like fair competition, like universal human rights, like access for those in developing countries and inclusiveness et cetera, et cetera.

So, I would also appeal to those of you in civil society and those in the so‑called multistakeholder community that are assembled here, to think about how you yourself can be a part of bridging the gaps between these different worlds and looking at how we can develop a positive agenda for rules‑based trade that impacts a digital economy.  Very often it is almost a clash of those looking to strengthen rules and those who are very, very much against trade rules or against trade agreements.  And I think it's unfortunate because I frankly see a lot of potential.  But it would benefit our ability to have legitimate trade rules, our ability to do the right thing, based also on technical knowledge.  We could really benefit from more engagement from policymakers and from a stronger cooperation between people in the tech‑specific work, Internet governance community and in the trade world.  Thank you.

>> TORBJÖRN FREDRIKSSON:  Thank you so much, Marietje.  As I said, there is not much time for interaction in this session, this open forum.  What I would like to see is if there are a few people that would like to make like a thirty‑second point.  Let's see if there is ‑‑ I see Richard. I can see you clearly over there.  Let's take these three comments.  I encourage you so we don't mess up the next session which is starting very soon after ours finishes.  So, try to be very brief and succinct in making your point.  Richard, you can start.

>>  RICHARD:  Thank you, Tobjörn. I just want to stress that what happened in Argentina, is that 60 activists actually were prevented entry by the Argentine the government.  WTO, in my opinion, didn't complain much about that.  So much for multistakeholder.  I believe that these discussions should take place in UNCTAD, not WTO, because UNCTAD is more much open and also it's focussed on development. 

And don't kid yourselves, this pluralateral things ‑‑ you have our brochure; I've handed it out to everybody here ‑‑ that's just America first ‑‑ and we know the outcome of that.  You have seen it.  It is ACTA, TPP, TTIP and Tisa [phonetic].  Now, the people pushing for rules in WTO, many of the 44 ministers and 70 countries that applied to that are actually violently opposing any form of discussion in other UN forum bodies.  That is I think very strange.  Why do people want binding rules in WTO when they refuse discussion in much more open UN forums.  Something's wrong here. 

Bill, you said that trade negotiations at some point have to be closed when you're trading bananas against whatever.  Well, as you know very well as an experienced negotiator, it's not win‑win negotiations that are closed, it is win‑lose.  Yes, I have to stop.  Well, what we need as a preliminary step is global data protection rules ‑‑ I think most people here would agree to that.  But also, it was mentioned, global antitrust mechanisms.  Until we have those, there is no way we're going to have equitable trade rules negotiated anywhere, in particular not in the closed system that is the WTO. Thank you.

>> TORBJÖRN FREDRIKSSON:  Thank you so much, Richard. And the gentleman over here, please introduce yourself.

>>  AUDIENCE MEMBER:  Yes. this is Milton Mueller, at the Georgia Institute of Technology, Georgia Internet Governance Project.  Two quick points. when we talk apartment civil society position, there is no "the civil society position"; there is a serious debate going on in the civil society and it is a debate, not a fight, about the value of trade in ‑‑ and open, free flows of information.  We need to just face that fact and have an open and honest discussion of the merits and demerits.

The other point I want to make ‑‑ to ask Bill about:  Is it actually a good thing to bring the Internet stuff into the trade negotiations?  In effect, trade control and the digital economy is Internet control.  And for those of us who are kind of against Internet control, it's maybe stacking the deck against free flow, to put it into a trade context where it does get stuck with banana tradeoffs and labor immigration, all kinds of things.  Is that the right strategy to do that.

>> TORBJÖRN FREDRIKSSON:  Thank you very much. Parminder, please.

>>  PARMINDER:  Thank you so much, first, a process point.  I am coming from Buenos Aires WTO.  And I see a lot of people here speaking about the issues why it ‑‑ that there should be trade rules.  There were very cogent arguments by developing countries why there shouldn't be trade rules at this point.  And I see this point a little underrepresented in this room.  And on that count, I will take a little longer to express my point of view.  Not too long, though.  The first point I wanted to raise ‑‑ thank you for excellent information ICT, Information Economy Report.  But, as we have seen in other areas of economy, agriculture, industrialization and now digital industrialization, it is first that a culture learns to do agriculture then gets into trade about agriculture goods.  First the country industrializes then gets into international trade about industrial goods. 

So, would UNCTAD like to look at digital industrial policies of how developing countries should first digitally industrialize, strengthen their economies, digital economies, and then talk about digital trade rules.  Because that comes first.  And UNCTAD is supposed to give that alternative discourse, whether it should be talking about the role of public infrastructure in digital economy, public digital infrastuctures and public data infrastructures, in which India has done a lot of work. EU has done some work. 

For example, in industrialization it was always necessary to have public infrastructure roads, ports, banks, and all.  And for digital economy also, we need public digital infrastructures, which is not talked about at all.  The protection that infant industry requires, what about it?  And we talked a lot about flow of data, free flows of data.  Why shouldn't we be talking about free and equal access to data because access to data as a resource is important and talking about data ownerships as we talk about data flows. 

Another question is that:  A lot of people on the panel spoke about why we should hurry to make rules on the digital economy, binding rules on the digital economy.  In this same building, there is a CSTD Working Group on enhanced corporation, where people are talking about making institutions for making binding rules for the digital society.  How it not opposes making rules for digital society and developing countries are asking for the rules.  And at the WTO there is a reversal, not says make rules for the digital economy; and the South opposes making rules for the digital economy.  Which means that not want to frame everything through a trade lens, which is a typical definition of neoliberalism.  Thank you and that, I think, should be balanced. Thank you and apologies for a long intervention.

>> TORBJÖRN FREDRIKSSON:  It wasn't that long.  So, thank you very much for that contribution.  I am very conscious of the time.  Let me just thank the interventions.  I'm going to let Bill have one word to respond to Milton.  And then, just on the comment made by Parminder here about UNCTAD.  UNCTAD is not a direct party to what goes on in WTO, but we see that this e‑commerce and trade are related to digital economy is growing fast.  Our main concern is to make sure that stakeholders inside the developing countries have as fair a chance to take advantage of what is happening now, which means that we will put the focus on strengthening all of the various policy areas that are needed to be able to take advantage and benefit from digital trade or e‑commerce. 

The pure trade policy dimension, we are not intervening on that one.  It's up to member states to decide whatever they want to do?  If member states agree to move on, we will support developing countries in that process.  If member states decide to postpone or not take it up at all, then we will help developing countries in that context as well.

I just wanted also to flag, because there have been references to the consumer protection and competition policy, here at UNCTAD we have now three governmental groups of experts that all have a bearing on what we are talking about today.  We have the intergovernmental group of experts on e‑commerce and digital economy.  We also have another IGE on consumer protection that will deal also with e‑commerce in that context and a third one dealing with competition policy and law, which is highly relevant also for this discussion.  Just for your information.  And, as you rightly pointed out, the discussion can also be brought into ‑‑ even more, perhaps in the context of the CCD (?) that has also this interface between development and technologies. 

Let me give Bill just a final comment on whether this is a good idea and then I will actually not open up for all of the panelists in the interests of time.

>>  WILLIAM DRAKE:  There is another panel in five minutes.  We have to go.  Real briefly, Milton, my view is to the extent that the trade agreements begin to work on Internet issues, it will be better to have a freestanding agreement.  So I would rather see an agreement on digital trade that is not interwoven with all the other stuff.  It worries me when in Tisa and in other environments you have good people saying "I will allow openness in my country in exchange for . . . " or, conversely,  when people say "Well, there's stuff in this agreement on other issues that I really don't like, like giving corporations the right to sue governments, or whatever, so therefore I oppose the whole thing," and that precludes the bit helpful to Internet openness.  My point is that I think the issues should be dealt with in a separate kind of agreement.  That's my view. 

Parminder, I don't think everybody was saying here we should hurry up and have digital trade agreements.  I think we were talking about the process by which ‑‑ this is going forward and the process in which we can engage on it. If the world did what I am suggesting, I think, actually, things would move a little slower because you have to have ‑‑ to get multistakeholder engagement and so on would require broader deliberation, broader interaction and would not be a rush towards agreement.  So, anyway, I stop.  Thank you.

>> TORBJÖRN FREDRIKSSON:  So, with that, I would like to extend a big "Thank You" to all of the panelists.  We cannot solve all of the problems, but I think our brief intervention here triggered inspiration for continuing the dialogue in other context and UNCTAD is ready to engage in that.  Thank you very much and a big applause for the panel.

(Applause)

(Session concluded at 10:00 a.m.)

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