 | Issue: | Latin America II 2000 |
| Article no.: | 2 | |
| Topic: | Electronic Commerce and Trade | |
| Author: | Allen Miller | |
| Title: | Client Executive | |
| Organisation: | Texas State Government, E.D.S. | |
| PDF size: | 16KB |
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Article abstract
Electronic commerce and the Internet are impacting the worlds economy at exponential rates. Some forecasters expect business-to-business electronic commerce to exceed US$ 1.2 trillion by 2003, and the online retail market is projected to reach US$ 80 billion by 2002. Electronic commerce is contributing to increased productivity and growth in virtually every sector of the economy, and nowhere is the potential for growth more vibrant than in Latin America.
Full Article
One wonders, however, whether the analysts making these predictions are considering the trade aspects of electronic commerce. While some countries have promoted an open and non-regulatory environment, other countries have introduced trade barriers to slow the growth of competition and to protect national incumbents. The cross-border commitments that were taken by countries in the Uruguay Round simply do not support the extent of global trade predicted by many of the analysts. Trade and electronic commerce are inextricably linked, and the future growth of electronic commerce is increasingly dependent on progress in the trade arena. Electronic commerce is not possible unless it can provide underlying goods and services cross-border. Driven by ever-changing technology, global and cross-border electronic commerce is in constant flux. Several components of the trade agenda are relevant to electronic commerce. First is the telecommunications infrastructure over which electronic commerce is conducted. The WTO plays a significant role in this sector, liberalising the infrastructure so that it is efficient, accessible and affordable. While the positive benefits of past liberalisation efforts have already been felt, it is important to continue to push vigorously for further liberalisation and for full implementation of prior commitments. Once the appropriate telecommunications infrastructure is in place, a number of related policies are needed to provide the proper environment for the development of electronic commerce. These policies, which constitute a second component of the electronic trade agenda, have been receiving much attention for some time. Dealing primarily with the establishment of trust in areas such as privacy, encryption, authentication and content, these policies have so far been dealt with effectively outside the formal trade agenda. Finally, a third component necessary for the development and growth of electronic commerce is an open and nurturing environment within each industry sector. In many areas, laws, policies and regulations constitute barriers to electronic commerce. In most cases, the barriers are not specific to electronic commerce. Rather they are endemic to the industry sectoral environment itself, but they disproportionately affect electronic commerce. The industry sectors represent the greatest challenge to the robust growth of electronic commerce. For the most part, commitments in the Uruguay Round did not represent extensive liberalisation, but rather a codification of existing law. Many sectors had few, if any commitments. For electronic commerce to thrive, services must be allowed to cross borders electronically. The problem is that many of the underlying services themselves may not be permitted across borders. Failure to allow cross-border services electronically stifles the growth of electronic commerce. Conclusion In this regard, continued WTO Services Negotiations are critical. Only through extensive and wide commitments across a broad spectrum of industry sectors can the development and future of electronic commerce be assured. Without these commitments, electronic commerce risks being relegated to a series of fragmented unconnected national markets. In summary, electronic commerce and trade are inextricably linked. Progress cannot be made in electronic commerce without corresponding progress in the trade arena.
