ITC Executive Director’s remarks at the G20
Bali, 23 September 2022 – Under Indonesia’s G20 Presidency, ITC Executive Director Pamela Coke-Hamilton spoke at the Trade, Investment, and Industry Ministerial Meeting, on priority issue No.4: Digital trade and sustainable global value chains.
I thank the Indonesian G20 Presidency for inviting ITC to this meeting in the beautiful city of Bali and for the warm hospitality.
Digitalization is rapidly transforming global trade. At the macro level, WTO simulations indicate that, on average, between 2021 and 2030, global trade growth will be two percentage points higher annually because of the adoption of digital technologies.
At the micro level, MSMEs worldwide increasingly rely on digital channels to make sales, reduce operational costs, reach out to new customers and business partners, and develop or adapt to new business models. Digital trade and e-commerce enable micro-firms to trade internationally and particularly contribute to the economic empowerment of women and youth. Our global e-commerce survey shows that the share of women-owned businesses is significantly higher in e-commerce than in traditional trade.
As the joint agency of the UN and the WTO, ITC supports developing countries through technical assistance to leverage trade and investment opportunities, including in digital trade and e-commerce. Our projects help to build conducive policy environments and business ecosystems for e-commerce, handhold SMEs to help them set up online shops, strengthen their capacities and digital skills, and connect them to international buyers and business partners.
Digital trade brings both opportunities and challenges. It can be an engine for growth and job creation, but it can further widen the existing digital gap among and within countries. Therefore, we must urgently address critical issues of digital access, digital literacy, and increased participation of SMEs and developing countries. G20 members can greatly support global digital trade development; let me share a few thoughts.
First, improve digital connectivity. The pandemic has vastly accelerated digital transformation. In 2021, the digitally connected population rose to around 63%, but that still leaves 37% of the world’s population unconnected, nearly all in the developing world. There’s an urgent need to keep improving digital connectivity to ensure that countries share equally the opportunities of digital trade. G20 can help by encouraging more ICT investment for development and more connectivity initiatives to bring the unconnected population online.
Second, enhance the capacities of SMEs to leverage digital trade. For SMEs to leverage digital technologies to expand their businesses, significant challenges remain, especially as digital platforms become more concentrated and data-driven. Equitable access to digital platforms, fair treatment, transparency, and predictability of digital platforms’ rules are key issues to ensure that MSMEs have access to and can benefit from the growing digital markets. Greater participation of small businesses in digital trade also drives the demand for digital capacity and, in turn, improves the business case for further investments in infrastructure: a virtuous cycle needed to build networks.
Third, develop enabling policy environment – domestically and internationally – to ensure that digital trade works for development and SMEs. In many aspects, current global trade rules were not designed with digital trade in mind. In this regard, multilateral and regional initiatives on digital trade and e-commerce can help to provide essential policy elements such as facilitating digital transactions, ensuring consumer protection and privacy, improving digital connectivity, and addressing new issues such as data governance, platform economy, competition, and cybersecurity, all of which are needed for the development of digital trade.
We walk the talk at ITC. With our SwitchON initiative, we have set out to achieve better digital connectivity for small businesses to trade. ITC welcomes partners to join us on this journey.
We look forward to continued collaboration with the G20 in supporting SMEs and developing countries to ensure that no one is left behind in the rapid digital transformation.
I thank you, chair, for this opportunity to intervene on this important issue.