G7 Trade Ministers’ Digital Trade Principles

In news:

• The Group of Seven wealthy nations agreed on a joint set of principles to govern cross-border data use and digital trade.

What are the Digital Trade Principles?

• Open digital markets: Digital and telecommunications markets should be competitive, transparent, fair, and accessible to international trade and investment.
• Cross-border data flows: To harness the opportunities of the digital economy and support the trade of goods and services, data should be able to flow freely across borders with trust.
• Safeguards for workers, consumers, and businesses: Labour protections must be in place for workers who are directly engaged in or support digital trade, providing decent conditions of work.
• Digital trading systems: To cut red tape and enable more businesses to trade, governments and industries should drive forward the digitization of trade-related documents.
• Fair and inclusive global governance: Common rules for digital trade should be agreed and upheld at the World Trade Organization.

 

About Group of Seven:

• The G-7 or ‘Group of Seven’ includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.
• It is an intergovernmental organization that was formed in 1975 by the top economies of the time as an informal forum to discuss pressing world issues.
• Initially, it was formed as an effort by the US and its allies to discuss economic issues.
• The G-7 forum now discusses several challenges such as oil prices and many pressing issues such as financial crises, terrorism, arms control, and drug trafficking.
• It does not have a formal constitution or a fixed headquarters. The decisions taken by leaders during annual summits are non-binding.
• Canada joined the group in 1976, and the European Union began attending in 1977.

 

G7 Digital Trade Principles:

• • Open Digital Markets: Digital and telecommunications markets should be competitive, transparent, fair, and accessible to international trade and investment.
  • Cross Border Data Flows: To harness the opportunities of the digital economy and support the trade of goods and services, data should be able to flow freely across borders with trust, including the trust of individuals and businesses.
  • Safeguards for Workers, Consumers, and Businesses: Labour protections must be in place for workers who are directly engaged in or support digital trade, providing decent conditions of work.
  • Digital Trading Systems: To cut red tape and enable more businesses to trade, governments and industry should drive forward the digitisation of trade-related documents. 
  • Fair and Inclusive Global Governance: Common rules for digital trade should be agreed and upheld at the World Trade Organization (WTO). 

 

Significance:

• Middle Ground: The deal sets out a middle ground between highly regulated data protection regimes used in European countries and the more open approach of the United States.
• The deal envisages removing unjustified obstacles to cross-border data flows, while continuing to address privacy, data protection, the protection of intellectual property rights, and security.
• Liberalise Digital Trade: The agreement reached by the elite global group is considered to be significant as it could liberalise hundreds of billions of dollars of digital trade.
• Enabling cross border data flows and clarifying the framework for processing and storing data will be required to further expand the contribution of digital exports.