Australia looks set to kick off a series of talks that could welcome in a new era of data sharing between developed and developing nations, with clear acknowledgement that multinational companies and those working across borders are struggling to deal with data and workflow gaps.
As part of the talks, held at the World Trade Organization (WTO), collaboration could take place to find new ways to improve cross-border trade. The flow of corporate data is near the top of the wish list.
Trade Minister Simon Birmingham, who is due to meet with his counterparts at the World Economic Forum (WEF) currently in progress in Davos, Switzerland, is leading the talks. Once the participants agree on some basic details, they will start to flesh out a strategic framework that is likely to include topics such as the better standardization of invoices, the carrying and measurement of data across borders and where data gets stored, particularly from a sovereignty perspective.
One of the key issues listed as an obstacle for digital trade being able to grow is cross-border compliance, which has been a regular topic of discussion at the WEF. The forum itself released a report this week that said: ‘Cross-border e-commerce has generated trillions of dollars in economic activity in recent years and continues to accelerate.’ It also noted: ‘The ability of data to move across borders underpins new business models, boosting global GDP by 10% in the last decade alone.’
However, the WEF was quick to point out that ‘outdated regulations’ could easily cause a problem, especially because of ‘fragmented governance’ and ‘strict data localization policies.’ This refers to the number of countries that maintain a policy of prohibiting the storage of data outside their borders.
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The WEF has railed against this issue at a time when protectionist measures in some key countries threaten to make it even more prevalent. This led Birmingham to tell the Australian Financial Review that there is a ‘need to avoid the introduction of a whole new range of non-tariff barriers to trade,’ which he said ‘could impede the ability of businesses to cross borders.’
Birmingham cited a report compiled by the Hinrich Foundation, which said that there is major potential for Australia to make the most of a growing digital export capability. This could grow 210% in the next decade and boost the Australian economy by an extra $200bn.
Australia’s leading of such measures is likely to see reinforcement at the G20, which will next take place in Osaka, Japan. Japanese Prime Minister Shinzo Abe said that WTO processes on data sharing should be top of the list for discussion, and he expects to prioritize them.
Many heads of enterprises and think tanks have welcomed the move. Institute of International Finance (IIF) President Tim Adams noted that this kind of development could bring data policies in line with the 21st century. Adams said that ‘our politics are really still situated in a 20th-century view of industrial [goods trade]’ and added that this will need adjustments to cope with the demands of changing markets.