Over the past twenty years, digital technologies have brought deep transformation to our industries and economies. They have contributed to U.S. economic growth and competitiveness. More recently, digital tools and technologies have enabled resilience amidst the disruptive impact of the COVID-19 pandemic, allowing people to connect, communicate, work, shop and learn virtually. Digital transformation is likely to only accelerate, as policymakers look for ways to strengthen economic resilience and boost economic recovery in a post-pandemic world.

The Biden Administration has a unique opportunity to help foster a digitally led global economic recovery. A concerted and coordinated strategy involving stakeholders such as the private sector and international partners will be critical to the success of American digital leadership. To make the most of this digital opportunity, policymakers must prioritize the pursuit and alignment of sound digital policies both domestically and internationally.

To shed light on these policy dynamics, BCIU spoke with David Weller, Director of Economic and Trade Policy at Google. David is a trade and tech policy guru with over 20 years of public and private sector experience working at the confluence of the Internet and trade policy.  “Many companies – in sectors ranging from manufacturing to agriculture to financial services – would describe themselves as digital companies that fundamentally rely on data and computing to operate and innovate,” says Weller. “In short, today the digital economy is the economy.”

Here is Weller’s take on three digital trends to watch that are certain to attract the attention of policymakers in 2021:

A growing lifeline for small businesses

Throughout the COVID-19 pandemic, digital capabilities have been central to economic resilience, allowing companies to keep workers employed and diversify customer bases through e-commerce. A recent survey of U.S. small businesses found that a third of US small businesses say they would have closed all or part of their business without digital tools. “In that same survey,” says Weller, “40% of small businesses said they were using digital tools to find new customers during COVID, including customers outside the United States.”

“While in the past, businesses may have been encumbered by the tyranny of geography – your economic fate being largely determined by your zip code – today, digital technologies and trade help break down those barriers and democratize commercial opportunities. That’s all the more important in the middle of this crisis,” says Weller.

Protectionism on the rise

At the same time that digital tools and services are more globally available and important than ever before, many governments around the world are turning inward and pursuing paths of protectionism. “Over the past several years, we’ve seen a real uptick in digital protectionism as well as lack of global cooperation on digital policies,” says Weller. “Some governments are asking themselves, should we build walls around our digital space in the interest of developing our domestic industry?  Others are struggling to address risks and harms but are coming up with solutions that don’t consider broader ramifications or the reality of interdependent economies.” These trends threaten our ability to reap the benefits of digital transformation and trade to spur economic recovery and growth. They are also contributing to a decline in Internet openness (as can also be seen in a recent survey by Freedom House finding that digital openness and digital human rights have declined in recent years).

Solutions and hope for cooperation

While some are sliding towards ‘beggar thy neighbor’ digital approaches, others are thinking about how to make national digital policies interrelate and interoperate across jurisdictions, including the movement of data, content policies, and tax regimes. “There is a growing understanding that we must extend the traditional principles of the international trading system into the digital economy to seize its benefits.  Non-discrimination, rules-based market access, transparent regulation, and due process will all be critical — just as those principles were critical in the pre-Internet world.”  At the same time, trade policy alone cannot ensure that trade — digital or otherwise — will deliver benefits equitably.  “Digital trade policy needs to be paired with other efforts — including affordable broadband access and digital skilling efforts — to ensure that digital trade delivers benefits for all communities.”

Ultimately, governments, the private sector and other stakeholders must work in partnership not only to address common digital policy challenges, but to expand the incredible benefits of digital technologies. “The pandemic makes it more clear than ever that we need to work together, across borders, to address the challenges and seize the opportunities from digital transformation– and avoid being starry-eyed digital optimists or jaundiced pessimists,” says Weller.

If you want to learn more about BCIU, please visit us at www.bciu.org and sign up to participate in our programming. 

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