During a meeting of the Council for Trade in Services, a group of governments proposed a discussion on “the challenges and opportunities for digital services delivery and governments’ activities aimed at achieving better digital inclusion,” in light of the growing importance of online services during the COVID-19 crisis.
WTO members raised trade concerns about measures related to transparency, 5G communications networks, pre-installed software, satellite operators, and cybersecurity.
The World Trade Organization (WTO) Council for Trade in Services considered governments’ efforts to help businesses and consumers increase digital capabilities and bridge the digital divide. WTO members also discussed trade concerns related to transparency, 5G communications networks, pre-installed software, satellite operators, and cybersecurity.
During the 1 July 2020 meeting of the Council, a group of governments proposed a discussion, in the context of the Work Programme on Electronic Commerce, on “the challenges and opportunities for digital services delivery and governments’ activities aimed at achieving better digital inclusion,” including by providing assistance to micro-, small and medium-sized enterprises (MSMEs) and to developing countries to enable them to increase their share of services exports. All members welcomed the proposal as a positive contribution to the Work Programme.
Many developed countries presented their ongoing programmes for increasing digital capabilities. Some highlighted improving connectivity, mastering digital tools, and enhancing international cooperation as essential to enabling “the transition from being buyers to suppliers in international services trade.” Among challenges, developing countries identified infrastructural constraints and the need to have access to data.
On the COVID-19 pandemic and its implications for trade in services, many WTO members highlighted the importance of sharing experiences, including on trade facilitating measures adopted to address the crisis and promote economic recovery. Several members recalled a recent report by the WTO Secretariat, which highlighted a greater reliance on online services in the wake of the crisis, particularly in sectors such as retail, health, education, telecommunications, and audio-visual, due to consumers adjusting to social distancing measures and suppliers expanding their online operations.
Many members recognized that the crisis has brought to the fore the urgent need to address disparities in digital connectivity. In reference to the moratorium on imposing customs duties on electronic transmissions, which members renewed in December 2019, the African Group said the pandemic underscores the importance of collecting tariff revenue on such transmissions.
Many members highlighted the importance of creating conditions conducive to trade in services, including open trade policies, to enable a sustained and socially inclusive post-COVID-19 recovery, and stressed 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:
- Australia’s 5G-related measures: China raised concerns over 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 that foreign companies are welcome in the country.”
- Russia’s fixed satellite operators measure: The US argued that a Russian measure concerning 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 having created any difficulties for foreign suppliers.
- Russia’s software pre-installation measure: The US raised a concern about a Russian measure on the pre-installation of software, 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 any discriminatory provisions.
The US and Japan also reiterated concerns about China’s and Viet Nam’s cybersecurity measures. These concerns were echoed by Canada, the EU, and Chinese Taipei. [WTO News Release] [Trade in Services on WTO Documents Online]
The Council for Trade in Services is responsible for facilitating the operation and furthering the objectives of the GATS. 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.