E-commerce – By South Centre
Perhaps the clearest indication of the growing importance of e-commerce in the global economy is the rapidity with which internet use has grown and spread during the last decade. E- commerce, however, also includes media such as the telephone, television, fax, and electronic payment, among others. Revenues from this sector are expected to surpass an astonishing $1 trillion in the year 2003.
Because of the significance that e-commerce has in the global economy, the Second Ministerial Conference in Geneva in 1998 wrote the Declaration on Global Electronic Commerce. The declaration calls for the establishment of a work program to examine “all trade-related issues relating to global e-commerce, including those identified by Members.” The declaration also stipulates that by the Third Ministerial Conference in 1999, the General Council will have had to have written a report on the progress of this work program. The WTO bodies responsible for investigating the effect of e-commerce on global trade are The Council on Trade in Goods, The Council on Trade in Services, The Council on Trade-Related Intellectual Property, and The Committee on Trade and Development.
The 1999 progress report notes that most e-commerce transactions are already covered under the GATS or GATT. However, there are ambiguous areas: are books that are delivered in digital form considered goods or services? What about software taken off the internet? The WTO must agree on ways to deal with these items, either by creating law that combines the GATS and GATT, or by creating new law.
As it stands now, there are few barriers to e-commerce. However, some WTO members, such as the U.S. and the E.U., fear that with continued growth in this sector of the economy, trade restrictions will be created. They also anticipate a plethora of policy issues that the WTO will eventually have to face, such as taxation on e-commerce transactions, and security and privacy of the transactions.
While many developed countries want to ensure that there will be no future barriers to e- commerce, because they often are the providers of services that are delivered electronically, developing countries worry that ensuring the openness of e-commerce will exacerbate the technological gap between them and developed countries. They fear that they will become solely consumers of e-commerce goods and services, rather than providers. Some countries also oppose the idea of open e-commerce for nationalistic reasons, preferring to regulate the flow of foreign goods, services, and culture into their countries.