Competitiveness and Innovation Archives

Trade Conference Focuses on Inclusive Global Economy

Published on December 3, 2019

Amid backlash to increased international trade and rising populism and protectionism across the globe, the Institute of Human Rights and Business (IHRB) held a conference on December 3 in London entitled Next Generation Trade: Building a Principled, People-Centred Global Economy. USCIB Vice President for Corporate Responsibility and Labor Affairs Gabriella Rigg Herzog and Senior Director for Investment, Trade and Financial Services Eva Hampl represented USCIB.

The conference focused on the issue of building a principled, people-centered global economy, and highlighted issues including climate, the future of work, the multilateral trading system, inclusive trade, and data and technology.

USCIB is very active in the space of trade and investment, as well as corporate responsibility and business and human rights.

“With an increasing public focus on international trade, it is imperative for the business voice to be heard in a variety of fora, emphasizing the message that trade and investment are vital contributors to economic growth and development,” said Hampl.

USCIB continues to believe that the World Trade Organization (WTO) is a pillar of the multilateral trading system and that the value of this trade institution cannot be overstated, and its continued existence is critical.

Stakeholders at IGF Seek to Avoid Fragmentation of the Internet

Published on December 3, 2019
L-R: Barbara Wanner, USCIB (moderator); Ben Wallis, Microsoft; Jane Coffin, Internet Society; Alex Cooke, Government of Australia; and David Gierten, OECD

The fourteenth Internet Governance Forum (IGF) wrapped up on November 29 with an invigorated call from stakeholders for an Internet governance mechanism that preserves the IGF’s multistakeholder model and expands its institutional capabilities, amid warnings from UN and German officials about the potential fragmenting of the Internet. USCIB Vice President for ICT Policy Barbara Wanner attended the four-day IGF in Berlin and reported from the field.

German Chancellor Angela Merkel, who formally opened the IGF on November 26, warned of the crippling effect of growing nationalism that will increasingly fracture the Internet. “The [digital] infrastructure has become the very core of our global economy… [but] there are some who remain in their little bubble and do not actually exchange views with people who are of a different opinion and that is one of the challenges that we face in this overall development of the Internet,” she said.

United Nations Secretary General Antonio Guterres offered a similarly dire outlook, telling the IGF audience that the today’s “accessible, free, secure and open Internet is at risk of fracturing along three intersecting lines … a profound digital divide, a social divide and a political divide.”

According to Wanner, Merkel and Guterres concurred that a comprehensive dialogue involving all stakeholders – citing the IGF as a model – can help to prevent such fragmentation, as this approach best ensures a healthy and thriving digital economy that can realize the Sustainable Development Goals (SDGs), connect the unconnected and bridge the digital skills gap. “The Internet must not and cannot be shaped only by governments alone because the basic issues revolving around the Internet have an impact on each and everyone’s life, and this is why we need a multistakeholder approach,” Merkel said.

“Against this backdrop, USCIB members who spoke in various workshops highlighted the importance of digital transformation by sharing business best practices and case studies that demonstrate how business’ digital innovations have improved people’s lives and livelihoods, created new commercial and employment opportunities and provided cultural connections,” said Wanner. “Their messages as workshops speakers and in bilateral meetings with UN officials and various government delegations also emphasized the importance of the multistakeholder model in considering the complexity of digital economy issues. In this regard, USCIB members reaffirmed their support for an adequately funded “IGF-Plus” architecture for Internet governance, proposed by the UN High-Level Panel on Digital Cooperation (HLPDC).”

Joining Wanner were members from Amazon, AT&T, CCIA, Disney, Facebook, Google, ITI, Microsoft, Verisign and Verizon.

OECD Turns to Practical Implementation of AI, Privacy Guidelines

Published on November 25, 2019

“Practical implementation” was an underlying theme at the recent discussions of the OECD Committee on Digital Economy Policy (CDEP), according to USCIB Vice President for ICT Policy Barbara Wanner, who reported from the field. The meetings took place November 18-22  at OECD headquarters in Paris. Wanner reported that having devoted more than a year to crafting the Council Recommendation on Artificial Intelligence, CDEP delegates and stakeholders discussed a paper outlining guidance on the implementation of the AI Recommendation, as well as the complementary AI Policy Observatory.

In a similar spirit, the Privacy Guidelines Expert Group (PGEG), which was convened to advance the mandated five-year review of the 2013 OECD Guidelines Governing the Protection of Privacy and Transborder Flows of Personal Data (the “Privacy Guidelines”), held a workshop on November 18 to explore the practicalities of operationalizing international cooperation in enforcement of privacy protections as well as consider the impact of AI on personal data protection and implementation of the Privacy Guidelines.

“Under the auspices of Business at OECD, USCIB members stepped up at the November CDEP meetings, intervening to underscore the importance of interoperability of privacy regulations to build trust and facilitate cross-border data flows for economic growth and prosperity,” said Wanner.

Citing Business at OECD’s Guiding Principles for the Review of the 2013 Privacy Guidelines, Wanner emphasized, “a consistent global approach to privacy will help companies of all sizes comply with [privacy laws], expand their commercial activities, and in turn grown their national economies with related employment benefits.”

Concerning implementation of the OECD’s AI Principles, Barry O’Brien (IBM Ireland), who chairs the Business at OECD delegation to the AI Experts Group, applauded the OECD’s proposed practical guidance as “building on the excellent work on the AI Principles and promoting the adoption and implementation of trustworthy AI.”

USCIB members actively shaped the development of the AI Recommendation as participants on a special AI Experts Group and are currently feeding business input to the PGEG.  USCIB members also made influential interventions concerning the proposed CDEP Program of Work and Budget 2020-2021 (PWB), work on online platforms, and key topics under the purview of the Working Party on Communications Infrastructures and Services Policy (CISP), such a draft report on price baskets for bundled communication services.

Joining Wanner were USCIB member representatives from Amazon, AT&T, CCIA, Comcast, Deloitte & Touche, Facebook, Microsoft and TMG Legal.

Hampl Weighs In On WTO Discussions on E-Commerce

Published on November 19, 2019

The sixth negotiating round of the Joint Statement Initiative (JSI) on E-Commerce is taking place at the WTO in Geneva this week. The JSI is negotiating a plurilateral agreement on digital trade, also referred to as the WTO E-Commerce Agreement. USCIB Senior Director, Investment Trade and Financial Services Eva Hampl is on the ground in Geneva this week on behalf of USCIB and members in support of this important initiative at the WTO, which attempts to write global rules on digital trade.

The JSI started out with seventy-six WTO members and as of this week that number has risen to 81, with Indonesia being the latest to join the plurilateral effort. Issues discussed this week include customs duties, access to internet and data, business trust, capacity building, legal issues, and market access.

“This will be the final round before the WTO General Council meeting taking place December 9-11 in Geneva. Negotiations are expected to resume in the new year at a similar pace, with an eye toward an outcome by MC12 in June 2020,” stated Hampl.

Earlier this year, USCIB issued recommendations on the E-Commerce negotiations, reflecting member priorities, including issues like data flows and localization. USCIB is actively engaging with governments involved in the negotiations in Geneva through various efforts, including the Digital Trade Network and the International Chamber of Commerce.

On Thursday, November 21, USCIB is supporting a side event by the ICC on the Moratorium on Customs Duties on Electronic Transmission (E-Commerce Moratorium), which is currently expiring at the end of the year. The panel will discuss the implications of not extending the moratorium, including in the context of the recent OECD Report. At this time, fifteen WTO members have proposed to extend the Moratorium until MC12 in June 2020. In order for an extension to be possible, unanimous support is required.

Donnelly Pushes for Strong Investment Protections at UNCTAD

Published on November 19, 2019

USCIB Vice President Shaun Donnelly led a small but vocal team of international business representatives at the November 13 annual High-Level Experts Group on International Investment Agreements (IIAs) at the UN Conference on Trade and Development (UNCTAD) in Geneva. In a room dominated by developing country and NGO reps and academics, Donnelly was the sole business speaker on the opening keynote panel. Donnelly also joined a French business delegate on the key follow-up panel on “Reforming Investor-State Dispute Settlement (ISDS).” Other panels included business representatives from USCIB’s BDI colleagues (German industry group) and from the World Economic Forum (WEF).

“In both my presentations, I emphasized a business view on the need for strong investment protections to help reduce risk and mobilize much-needed foreign direct investment (FDI) flows,” said Donnelly. “With limited public finance and official development aid resources, FDI is key to global economic growth and progress toward the UN Sustainable Development Goals (SDGs). Furthermore, strong IIAs are key to mobilizing FDI. In turn, strong ISDS provisions are essential to effective IIAs.”

According to Donnelly, on the ISDS panel, he was able to rebut a European Commission official who was pitching, as they are in multiple fora these days, their proposal for a standing multilateral investment court to replace the well-established ISDS arbitration system.

“UNCTAD can be a challenging organization, often promoting unhelpful non-market views, but in the investment area it offers a unique opportunity for good dialogue with developing country officials and a platform to confront unhelpful EU initiatives,” he added.

Domain Name System Abuse: A Hot Topic at Recent ICANN Meetings

Published on November 19, 2019

The Internet Corporation for Assigned Names and Numbers (ICANN) wrapped up six days of annual meetings on November 7 in Montreal, Quebec, which featured, at times, heated debate about the roles of ICANN and the contracted parties in mitigating domain name system (DNS) abuse and related security problems. According to USCIB Vice President for ICT Policy Barbara Wanner,  who attended the meetings in her capacity as the Business Constituency’s (BC) representative to the Commercial Stakeholder Group (CSG), while security threats and the way the ICANN community tracks, reports, and mitigates them have always been an important focus of ICANN’s work, attention to this issue has intensified in recent months amid reports of sharp increases in phishing attacks and studies estimating that the cost of global cybercrime reached approximately $600 million in 2018.

“ICANN’s Business Constituency (BC), of which USCIB is a member, highlighted profound gaps in DNS abuse mitigation throughout the week’s meetings with the ICANN Board, senior ICANN staff, and other constituencies and the need to clarify definitions of abuse and aggressively enforce against offenders,” said Wanner.

According to Wanner, participants at ICANN 66, the organization’s Annual General Meeting, continued to advance discussions about the building blocks of a model to enable third-party access to nonpublic domain name system registration data for legitimate purposes that would comply with EU General Data Protection Regulation (GDPR) and other privacy regimes. The draft model may be finalized as soon as December, more probably in early 2020, following receipt of legal advice from the European Data Protection Board (DPB).

The meeting also continued to explore how to evolve ICANN’s multistakeholder model to improve its efficiency and effectiveness as part of the FY 2021-2025 Strategic Plan as well as other DNS management issues.

Wanner’s role as BC representative to the CSG has enabled greater input to policy discussions at the CSG executive committee-level on behalf of USCIB members and facilitated important meetings with senior ICANN officials and other key constituencies.  USCIB member representatives from Amazon, AT&T, BT Americas, CenturyLink, Facebook, Google, Microsoft, and NBC Universal were present in Montreal and actively contributed to all policy discussions.

Focus on Sustainability, New Technologies at 2019 World Trade Symposium

Published on November 11, 2019

USCIB once again sponsored the World Trade Symposium this year November 6-7 in New York. The Symposium, hosted by Finastra and programmed by The Economist Events, brought together researchers, government officials and private sector leaders to discuss “Trade in an Uncertain World.” According to USCIB Assistant Policy and Program Manager Daniella Goncalves, several themes emerged throughout the Symposium, including the impact of new technologies on trade and investment, the need for greater interoperability of new technologies, the importance of sustainability to trade and investment and the continued importance of free trade.

Political uncertainty took center stage during the event’s discussions. The rise of populism and protectionist policies, as well as perceived lack of efficiency and productivity in multilateral fora, were identified as threats to be addressed. Many participants expressed the need to reform multilateral institutions and reaffirmed their support for trade liberalization. The need for U.S. leadership in such reform and trade liberalization activities was highlighted as a priority. Participants were in agreement that the restoration of predictability, reciprocity and fairness is required to bolster global trade and investment.

Digitization has the ability to drive down costs and speed of getting goods to market, but standardization of data protection and date flow regulation are priorities. The importance of regulating data flows and the need for standardized data protection laws, new technologies and the issue of illicit trade were highlighted by several panelists, including the World Trade Organization (WTO) Deputy Director-General Ambassador Alan Wm. Wolff, Research Professor of International Affairs & Director of Digital Trade & Data Governance hub Susan Ariel Aaronson and President of the Mediterranean Shipping Company Fabio Santucci.

The use of blockchain was characterized as a means to more efficiently engage in trade and investment, as well as increase sustainability through decreased paper usage. However, interoperability of blockchains and standardization of regulatory frameworks remain hurdles to wide-spread deployment of this technology.

It was noted that the International Chamber of Commerce (ICC) is working with an Asia-based partner to develop a blockchain technology to enable traceability and tracking of goods. The goal ultimately is to promote interoperability among various blockchain networks and technology platforms.

Recognizing the rise of consumer interest in sustainability, the issue of sustainable trade and investment was discussed. According to the panelists, millennial consumers are driving interest in and profitability of sustainable goods and services. Trade has lifted hundreds of millions out of poverty; to continue to see the benefits of trade, growth needs to be inclusive. USCIB is actively advocating on these important issues in various multilateral fora, including at the Organization for Economic Cooperation and Development (OECD) in Paris.

OECD Report Weighs In On WTO Moratorium Debate

Published on November 11, 2019

The much-anticipated Organization for Economic Cooperation and Development (OECD) report on the World Trade Organization (WTO) moratorium on customs duties on electronic transmissions was de-classified on November 4.

According to USCIB Senior Vice President for Policy and Government Affairs Rob Mulligan, the report, “Electronic transmissions and international trade – Shedding new light on the moratorium debate,” concludes that revenue implications of lifting the Moratorium are likely to be relatively small and would come at the expense of more significant gains in consumer welfare (estimated at 940 million USD) and export competitiveness.

The Moratorium, which has been in place since 1998 and has been continuously extended every couple of years since then, is once again due to expire at the end of 2019. Keeping the Moratorium is crucial for business, and USCIB has been actively engaged in pushing back against the opponents of extending the Moratorium with the ultimate goal of making it permanent.

The OECD report also notes that the highest estimated share of opportunity cost in terms of foregone revenue is in digitizable goods, which is low, at 1.2% of total trade. This will likely remain low even with the advent of technologies such as 3D printing, which are unlikely to have far-reaching implications on trade in the near term.

The report noted that tariffs also come with costs. Tariffs are associated with lower output and lower productivity and their burden falls mainly on domestic consumers, not foreign firms. Tariffs are also an unstable source of revenue. Alternatives exist in the form of non-discriminatory value added taxes or goods and services taxes.

The WTO General Council meeting, set for December 9-11, will provide a final opportunity to extend the Moratorium.

USCIB Welcomes New US Ambassador to UN in Geneva

Published on November 11, 2019
L-R: Rob Mulligan, Peter Robinson, Andrew Bremberg, Shaun Donnelly

Newly-confirmed U.S. Ambassador to the United Nations offices in Geneva, Andrew Bremberg, visited USCIB’s Washington office on November 5 to share U.S. government priorities and to hear business perspectives and concerns before heading to Geneva to assume his post later this week. Throughout the discussion, Ambassador Bremberg emphasized that the U.S. government’s current priority, as well as his top personal priority, is to reform and improve international organizations.  

USCIB members from The Walt Disney Company, Facebook, ExxonMobil, Hanesbrands, PMI and Walmart, along with USCIB policy experts, emphasized the importance of supporting inclusive multilateralism such as that found in the World Trade Organization and International Labor Organization, and changing the persistent and counter-productive discriminatory treatment that the private sector encounters in some UN agencies.

USCIB’s Norine Kennedy, who helped lead the USCIB delegation to Geneva earlier this year, noted USCIB initiatives to help further inclusive multilateralism through USCIB’s All In Campaign. Several participants expressed appreciation for the support Ambassador Bremberg’s team at the U.S. Mission in Geneva has been providing to U.S. business.

“We see ourselves as global regulatory diplomats,” added USCIB President and CEO Peter Robinson. “The challenges facing society today cannot be solved by governments without having business at the table.  We look forward to working with Ambassador Bremberg and his staff as he begins his important work with the WHO, the World Intellectual Property Organization, the International Labor Organization, the International Telecommunications Union and other UN agencies in Geneva.”

 

New OECD Deputy Secretary General Meets With USCIB

Published on November 11, 2019
L-R: OECD Deputy Secretary General Ulrik Vestergaard Knudsen; Head of the OECD’s Washington office Will Davis

USCIB members and staff had the opportunity to meet with the new Organization for Economic Cooperation and Development (OECD) Deputy Secretary-General Ulrik Vestergaard Knudsen on November 5 at the USCIB Washington DC office. Knudsen’s diverse policy portfolio at the OECD includes science, technology and innovation, trade and agriculture, the OECD Center for Entrepreneurship, SMEs, as well as regions and cities.

The dialogue between Knudsen and USCIB members focused on areas of mutual interest such as taxation policy, including the pressing issue of digital taxation, as well as cross-border data flows, healthcare, trade and investment, digital trade, and the Going Digital Project. Knudsen also mentioned Artificial Intelligence (AI) as an increasingly important issue for the OECD and the establishment of the OECD AI Policy Observatory, which will help countries nurture and monitor the responsible development of trustworthy AI systems for the benefit of society.

L-R: Norine Kennedy (USCIB), Will Davis (OECD Washington), Ambassador Ulrik Vestergaard Knudsen (OECD), Peter Robinson (USCIB), Eva Hampl (USCIB), Rob Mulligan (USCIB)

USCIB members from Microsoft, IBM, General Electric, CropLife America, Walmart and others, benefited from the opportunity to hear directly from OECD leadership regarding the OECD’s priorities as well as an update on the OECD accession process. USCIB participants underlined the importance of maximizing access for business and other responsible stakeholders in all OECD committee meetings.

“We are grateful that DSG Knudsen took the time to meet with U.S. business,” said USCIB Senior Vice President for Policy and Government Relations Rob Mulligan. “USCIB staff and members always appreciate an opportunity to provide perspectives to the OECD staff and secretariat to help inform the OECD’s science-based policy recommendations.”

USCIB is the U.S. national committee of Business at OECD (BIAC).