Digitrade Digest #18

US EU Trade and Technology Council, UK- Australia FTA, FTC has new regulator

The Digitrade Digest delivers the latest developments in global digital trade right to your inbox every week. To get the news as it happens, follow us on Twitter @DigiTradeDaily

Africa

Ghanaian president: U.S. support of AfCFTA key to Africa’s transformation

Insidetrade: During an event hosted by the U.S. Chamber of Commerce, Akufo-Addo called on Africa and its trading partners to abandon old models and “establish a sustainable, strategic partnership based on trade and investment cooperation.”

Africa’s “economic relationship with the developed economies of the world,” he said, has long been based on the export of raw materials and the import of “manufactured products and technologically advanced services,” as well as on the provision of aid “ostensibly to help lift Africans out of poverty” -- but which has served neither “giver” nor “receiver.”

“As much as Africa needs to move away from the mindset of dependence and aid, the developed world likewise must abandon the mentality of charity to the poor Africans,” he said.

US

US, EU establish trade and technology council to compete with China.

The Hill: The United States and the European Union (EU) on Tuesday formally established a Trade and Technology Council (TTC) to coordinate on critical technology issues such as developing semiconductors, researching emerging fields and securing supply chains.

The TTC was established as part of the U.S.-EU summit held Tuesday in Brussels and is intended to serve as a vehicle to compete with China on emerging technology issues.

The nations committed in the official summit statement to driving “digital transformation that spurs trade and investment, strengthens our technological and industrial leadership, boosts innovation, and protects and promotes critical and emerging technologies and infrastructure.”

Biden’s Federal Trade Commission pick is an energetic critic of Big Tech

PBS: The selection of legal scholar Lina Khan to head the Federal Trade Commission is seen as signaling a tough stance toward tech giants Facebook, Google, Amazon and Apple. Khan was sworn in as FTC chair just hours after the Senate confirmed her as one of five members of the commission on a 69-28 vote.

Khan has been a professor at Columbia University Law School and burst onto the antitrust scene with her massive scholarly work in 2017 as a Yale law student, “Amazon’s Antitrust Paradox.” She helped lay the foundation for a new way of looking at antitrust law beyond the impact of big-company market dominance on consumer prices. As counsel to a House Judiciary antitrust panel in 2019 and 2020, she played a key role in a sweeping bipartisan investigation of the market power of the tech giants.

House Democrats seek to recoup constitutional authority in GSP, MTB renewal bill

Insidetrade: The House Science Committee this week approved the “National Science Foundation for the Future Act,” the lower chamber’s counter to the Endless Frontier Act, which was the centerpiece of the Senate’s China bill. House Foreign Affairs Committee Chairman Gregory Meeks (D-NY) has offered up the “Ensuring American Global Leadership and Engagement,” which has similarities to the “Strategic Competition Act,” another major piece of the Senate-passed legislation.

Crapo and Wyden’s language renewing GSP and MTB is very similar to the language House Democrats have proposed, Kind said, pointing to one difference over free flow of data requirements for GSP beneficiary countries. Kind said Ways & Means Democrats believe it would be difficult to enforce such requirements with least-developed nations, so they were thinking about including language requiring reports on the matter instead.

Blumenauer pointed to “very strong” concerns about some finished goods that benefit from GSP tariff breaks. He suggested that some finished goods could receive duty-free treatment under GSP even though more than half of their makeup could be inputs from China, “which is not what GSP is about.”

On broader issues, including stronger environmental requirements and other Democratic priorities, Neal said the trade subcommittee would have “ample time” to review how its proposals compare to the Senate’s.

The “Generalized System of Preferences and Miscellaneous Tariff Bill Modernization Act of 2021” would extend GSP through Dec. 31, 2024 and provide retroactive benefits, Ways & Means Democrats said in a statement. “The GSP is an outdated program that inadequately addresses serious labor violations, omits criteria related to the environment, lacks needed transparency, and fails to meet the standards of our more recent preference programs,” they added. “This legislation modernizes the program’s eligibility criteria by adding an environmental criterion and updating the labor criteria. It adds new criteria on human rights, rule of law, anti-corruption, and equitable economic development. It also adds new annual country eligibility reviews and transparency requirements while enhancing public access and participation in the program.”

UK

UK-Australia FTA negotiations: agreement in principle

GOV.UK: Australia and the United Kingdom commit to ambitious commitments that will increase opportunities for digital trade across all sectors of the economy, while also ensuring world-leading standards for personal data protection and for legitimate public policy objectives. These will include strong rules on data flows and the prohibition of unjustifiable data localisation requirements to create a more certain and secure online environment and support increased growth in digital trade between Australia and the United Kingdom. It will also include provisions to ensure the recognition of electronic contracts and signatures and legal frameworks on electronic transactions that facilitate ecommerce.

In digital trade, the UK is becoming more like the US than the EU

NewStatesman: Many UK businesses struggle to export their digital innovations, and it’s partly due to a lack of international consensus on digital trade. The government has made ambitious statements about putting digital trade at the heart of the post-Brexit strategy, making the UK a “leading global voice” and “the intellectual driving force” behind digital trade, in the words of International Trade Secretary Liz Truss.

But the government is yet to set out a clear strategy, says Beatriz Kira, senior research and policy officer at University of Oxford’s Blavatnik School of Government: “There's a lack of data, a lack of analysis, and a lack of participation and transparency in terms of which groups have access to the decision-making process.”

This has not stopped the UK from negotiating trade deals with digital provisions. Its trade deal with Japan, as well as application to join the 11-nation Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), contain commitments on digital trade.

These commitments suggest the UK could align itself more closely to the US vision of digital trade, which prioritises the free flow of data and the protection of intellectual property. The EU’s approach puts citizens’ data rights first, but there is “a lot the UK has to lose in terms of not being aligned with the EU”, says Kira.

WTO

The Case for Ambitious Services Market Access Commitments as Part of the WTO Joint Statement Initiative on E-Commerce

ITI: Technological advances have not only greatly enabled trade in an increasing range of services sectors, but reliable services have become essential inputs to enable trade in goods. However, despite the growing economy-wide importance of global services trade, a wide gap remains between applied regimes and international commitments on services market access, while meaningful market access restrictions persist in important sectors. Beyond creating a necessary underpinning for modern rules-based digital trade, the establishment of binding market access commitments in the context of JSI negotiations that expand upon those in the General Agreement on Trade in Services (GATS) would directly contribute to the broader and more equitable distribution of benefits stemming from policies that promote open digital trade, and, in many cases, is necessary for firms to realize any benefit from rules-based commitments.

Big Tech

China isn’t the issue. Big Tech is.

NewYorkTimes:  What prompted my eye rolling was how tech companies have responded to a recent flurry of activity that could profoundly alter life for America’s tech superstars, and all of us who are affected by their products. Several Democrats in Congress have proposed new laws to crack down on big technology companies. And the new chair of the Federal Trade Commission, Lina Khan, has advocated for aggressive enforcement of monopoly laws to stop what she sees as big tech companies preying on consumers.

Those steps could unravel the status quo in technology, or not. We’re in a messy phase that makes it tricky to predict what Congress, states, courts and government enforcers might do to change the rules for tech companies — and whether it will do more good than harm.

But powerful corporations and people who support them aren’t grappling with the nuances. Publicly at least, they have responded as they often do, by essentially implying that guardrails on some U.S. technology companies create the conditions for China to take over the world. Somehow. Don’t ask how.

Here’s what an official at NetChoice, a group that represents Google, Facebook and Amazon, told The Washington Post about the crop of Big Tech regulation bills: “At the same time Congress is looking to boost American innovation and cybersecurity, lawmakers should not pass legislation that would cede ground to foreign competitors and open up American data to dangerous and untrustworthy actors.”

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The Digitrade Digest is a weekly publication of the Digital Rights Program at Public Citizen.