MC12: last chance to prove the WTO is still relevant to a global multilateral order?

The World Trade Organization’s 12th Ministerial Conference will be critical to prove that the trade body can bring multilateral dialogue back on the agenda and deliver on global challenges.  

If the 12^th ministerial conference is to be a success, it should be the impetus to securing an inclusive and sustainable recovery, powered by impactful digital trade outcomes. We call on Europe and our international partners to:  

• Make permanent -or at least extend- the Moratorium on Customs Duties on Electronic Transmissions
• Sign a ministerial declaration in support of the multilateral E-Commerce negotiations.
• Bring together an energised set of countries to drive towards both a product and geographical expansion of the Information Technology Agreement (ITA3) and a geographical expansion of current ITA agreements.

Cecilia Bonefeld-Dahl, Director-General of DIGITALEUROPE, said: 

“The 12th Ministerial Conference comes at a critical moment to put the WTO on the right reform path. We cannot afford another setback. We must move forward by making the Moratorium on Customs Duties on Electronic Transmissions permanent -or at least extend it-, providing political support to the JSI negotiations on and work towards an ITA3.

Thanks to the enthusiasm of the co-convenors, negotiations on E-Commerce have been making steady progress. If we are to come to an agreement on some of the more challenging chapters, we need strong political stimulus in the form of a ministerial declaration at MC12.

The appointment of Director General Ngozi Okonjo-Iweala was a much-needed injection of optimism and energy in Geneva. Her leadership represents an unmissable chance to put multilateral trade under the spotlight and contribute to an inclusive and sustainable economic growth.”

DIGITALEUROPE’s top recommendations for the WTO’s 12^th ministerial conference

Securing the Moratorium on Tariffs for Electronic Transmissions 

For more than two decades, WTO members have maintained the Moratorium preventing the use of customs duties on electronic transmissions, keeping at bay heavy border tariffs and burdensome procedures. 

Letting this moratorium expire without renewal or making it permanent would not only constitute an unprecedented setback at a time when the relevance of the WTO hangs in the balance. In practical terms the expiry would: 

• seriously jeopardise the privacy, intellectual property and security of citizens, workers and consumers globally; 
• significantly increase costs to businesses and introduce needless economic strain, which would disproportionately affect SMEs who rely on the moratorium to grant them access to and use of digital tools, and;
• prove counterproductive to all participating members, including developing countries, facing far greater costs to their economies than any revenue the measure might generate at the border. 

We therefore call on all WTO members to make permanent -or at least extend- the Moratorium.

Advancing the E-Commerce negotiations 

Negotiations on a new E-Commerce multilateral agreement are crucial to alleviating global barriers to the free flow of data. Those barriers constrain cross-border trade, impeding innovation and access to the most advanced technologies at an affordable cost. A DIGITALEUROPE study conducted by Frontier Economics showed that international alignment on free flows of data could bring €2 trillion worth of growth to Europe by 2030, or 1.5 per cent of GDP per year. It would also add 700,000 highly skilled jobs. 

Ensuring that the WTO can produce straightforward E-Commerce rules will allow digital technologies to drive the recovery and future economic growth, for Europe and for global partners.  

In December 2021, the co-convenors of the JSI on E-Commerce published a joint statement. We welcome the progress and text consolidation achieved so far and applaud the co-convenors’ commitment to secure convergence on most issues by the end of 2022.

Now, we call on participants in the plurilateral initiative to sign a ministerial declaration at MC12 that:  

• reaffirms their commitment to advancing the negotiations.
• sets a clear target-date to work towards the conclusion of these negotiations, and; 
• lays out an ambitious workplan with clear steps

Expanding the Information Technology Agreement  

So far, the current ITA, following its 2015 expansion, has brought around US $50 billion in tariff savings on ICT sales globally each year, adding approximately US $190 billion to global GDP.  

We call for more governments to become signatories of this WTO tariff-busting success story that has already delivered for the global digital economy and the people who rely on it. 

It is clear to us that expanding product and geographical scope of the ITA should go hand-in hand with the reinvigorated E-Commerce negotiations from MC12 onwards. At the same time, enforcement of existing commitments remains our goal.

In the words of WTO DG Dr. Okonjo-Iweala, who spoke at the ITA Symposium in September, celebrating its 25-year anniversary, in which DIGITALEUROPE participated:

“The WTO is about people. The ITA is proof of this: it has increased people’s purchasing power, created jobs, and enhanced access to new technologies.”

MC12 serves as a unique opportunity to bring together an energised set of countries to drive towards both a third expansion (ITA3) and a geographical expansion of current ITA agreements.