The World Trade Organization (WTO) Council for Trade in Services considered efforts by governments to help businesses and consumers increase digital capabilities and reduce the digital divide. WTO members also discussed trade concerns related to transparency, 5G communications networks, pre-installed software, satellite operators and cybersecurity, the organization reported on Tuesday (07.07.2020) in a release.
During the Council meeting on 1 July 2020, a group of governments proposed a discussion, in the context of the Work Programme on Electronic Commerce, on “the challenges and opportunities for the provision of digital services and the activities of governments aimed at achieving better digital inclusion"including by providing assistance to micro, small and medium-sized enterprises (MSMEs) and developing countries to enable them to increase their participation in services exports. All members welcomed the proposal as a positive contribution to the Work Programme.
Many developed countries presented their ongoing programmes to increase digital capabilities. Some highlighted improving connectivity, mastering digital tools and enhancing international cooperation as essential to enable “the transition from being buyers to suppliers in international trade in services.” Among the challenges, Developing countries identified infrastructure limitations and the need for access to data.
On the COVID-19 pandemic and its implications for trade in services, some WTO members stressed the importance of sharing experiences, including trade facilitation measures adopted to address the crisis and promote economic recovery. Several members recalled a recent report by the WTO Secretariat, which highlighted an increased reliance on online services in the wake of the crisis, particularly in sectors such as retail, health, education, telecommunications and audiovisual, due to consumers adapting to social distancing measures and suppliers expanding their operations online.
Members acknowledged that the crisis has highlighted the urgent need to address disparities in digital connectivity. Referring to the moratorium on the imposition of Customs duties on electronic transmissions, which members renewed in December 2019, the African Group said the pandemic underscores the importance of collecting tariff revenues on such transmissions.
Many members stressed the importance of creating enabling conditions for trade in services, including open trade policies, to enable a sustained and socially inclusive post-COVID-19 recovery, and highlighted the need to avoid restrictions in areas such as cross-border data flows that could undermine economic recovery.
WTO members highlighted a number of trade concerns, including:
- Measures related to 5G in Australia: China has expressed concern about Australia’s measures on 5G telecom projects, arguing that these measures prohibit Chinese companies from participating due to unreasonable, non-transparent and discriminatory requirements. Australia responded that its 5G network requirements are “fully consistent with WTO rules and foreign companies are welcome in the country.”
- Measure by Russian fixed satellite operators:The United States argued that a Russian measure on the allocation of radio frequency bands for foreign satellite operators violates Russia's relevant commitments under the General Agreement on Trade in Services (GATS). Canada and the EU echoed these concerns. Russia said it was not aware of the measure creating difficulties for foreign suppliers.
- Russia's software pre-installation measure: The United States has expressed concern about a Russian measure on software pre-installation, arguing that it violates Russia's GATS commitments in several services sectors. Canada, the EU and Japan echoed this concern. Russia stated that the measure does not prohibit the pre-installation of foreign software and does not contain discriminatory provisions.
- The United States and Japan also reiterated their concern about the China and Vietnam's cybersecurity measuresThese concerns were echoed by Canada, the EU and Chinese Taipei.
The Council for Trade in Services is responsible for facilitating the operation and promoting the objectives of the General Agreement on Trade in Services (GATS, for its acronym in English). Open to all WTO members, the Council oversees the work of four subsidiary bodies: the Committee on Trade in Financial Services; the Committee on Specific Commitments; the Working Party on Domestic Regulation; and the Working Party on GATS Rules. The Council for Trade in Services reports to the WTO General Council.
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