The world needs a new approach to allow data flows to cross borders as freely as necessary and possible in a global digital economy, according to the United Nations Conference on Trade and Development (UNCTAD).
In the Report on the Digital Economy 2021, published on 29 September, UNCTAD asserts that the new approach should help maximize the development gains, ensuring that those benefits are equitably distributed and minimizing the risks and damages.
It should also enable global data sharing, develop digital public goods, increasing trust and reducing uncertainty in the digital economy.
The report notes that the new global system should also help prevent further fragmentation of the Internet, addressing political challenges which presents the dominance of digital platforms and reduces existing inequality.
“It is more important than ever to embark on a new path for data governance and digital governance,” says UN Secretary-General António Guterres in his foreword to the Report. He adds: “The current data landscape is fragmented and we risk missing out on the value that could be derived from digital technologies and creating more room for substantial harm related to privacy breaches, cyber-attacks and other risks.”
In that line, the New UNCTAD Secretary-General, Rebecca Grynspan, says: “We urgently need a renewed focus on achieving global digital and data governance, developing digital public goods, increasing trust and reducing uncertainty in the digital economy. The pandemic has shown the critical importance of global health data sharing – the issue of digital governance can no longer be postponed.”
New body
For the reasons stated above, UNCTAD proposes the formation of a New UN Coordinating Body, focused on the assessment and development of global digital and data governance, with the necessary skills to do so. Its work should be multilateral, multidisciplinary and include multiple stakeholders.
There is also a need to seek to remedy the current under-representation of developing countries in global and regional data governance initiatives.
The body should function as a complement and in coherence with national policies. and provide sufficient policy space to ensure that countries with different levels of readiness and capacity can benefit from the data-driven digital economy.
The report notes that the current global context is characterised by divergent approaches to data governance, particularly by the three main players: United States, China and the European Union (EU).
He explains that the US approach focuses on private sector control of data, the Chinese model emphasises government control of data, while the EU favours individual control of data, based on fundamental rights and values.
In that sense, the Director of Technology and Logistics at UNCTAD, Shamika N. Sirimanne, says that “the absence of a global data governance framework hampers countries’ ability to reap the benefits of the digital economy.” It also hampers their ability to protect individuals’ privacy from data use by both the private sector and government, and to address concerns related to law enforcement and national security.
Data gap
The report warns that A gap is emerging as the data-driven digital economy evolves, leaving many developing countries to become mere providers of raw data to global digital platforms., while they have to pay for the digital intelligence generated from their data.
The The United States and China are the pioneers in leveraging data, according to the report. They account for 50% of hyperscale data centers in the world, the highest rates of 5G adoption, 70% of leading artificial intelligence (AI) researchers, and 94% of all funding for AI startups.
The two countries also account for around 90% of the market capitalization of the world's largest digital platforms, and during the pandemic their profits and market cap values have increased enormously.
For the world's seven largest digital platforms, between October 2019 and January 2021, share prices increased by between 55% (Facebook) and 144% (Apple).
As the race for leadership in technological developments to gain economic and strategic advantage continues, global digital platforms continue to expand their own data ecosystems and increasingly control all stages of the global data value chain.
Therefore, the report says, it is becoming increasingly difficult to consider regulations of cross-border data flows without also taking into account the governance of digital corporations.
“We need a new regulatory framework covering both economic and non-economic dimensions, and that it can work for countries with different levels of digital readiness,” concludes the Director of Technology and Logistics at UNCTAD. (UNCTAD's Digital Economy 2021 Report)
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