The globalization of the internet and the flow of data across borders have led to the digitization of economies, with every sector of the economy now relying on the internet and data to conduct business. Governments, business, and civil society in the developed and developing world can use these technologies to improve the quality of economic growth, create new jobs, strengthen social inclusiveness, and improve governance.
The globalization of the internet and the ability to move data across borders is also transforming the nature of international trade. This is happening in five key areas:
- Businesses can use the internet (particularly digital platforms) to export. This is a particular opportunity for small and medium-sized enterprises (SMEs) and businesses in developing countries to use these platforms—and the comprehensive set of ancillary services they provide—such as online payment mechanisms, to reach consumers globally.
- Services can be increasingly traded online, particularly IT, professional, financial, and education services. New digital services such as cloud computing have also been developed and are becoming crucial business inputs.
- Data collection and analysis is allowing new services (often also provided online) to add value to goods exports.
- Global data flows underpin global value chains.
- The growth of digital technologies such as 3D printing and M2M communications is further complicating the nature of trade transactions, with implications for regulatory co-operations and changes to established trade related principles like rules of origin.
In 2016, Brookings launched the multi-year Digital Economy and Trade Project to scale up new research and engagement with key stakeholders on these digital economy and trade issues. The project is led by Senior Fellow Joshua P. Meltzer, who is based at Brookings in Washington, D.C.
The work of the Digital Economy and Trade Project is focused on three key areas:
- Examination and policy advice for governments surrounding how to develop a regulatory environment to maximize the opportunities of the internet and data for economic growth and engagement in digital trade.
- Analysis, research, and engagement on the development of international trade rules and norms to support digital trade.
- Improving the understanding amongst regulators of the impact of regulation on digital trade.