E-commerce can help boost economic transformation and its potential for developing countries can therefore not be ignored.
This is according to Foreign Secretary Carl Greenidge, who made the pronouncement at a national workshop on Electronic Commerce held at Ramphal House in Georgetown. The event was also attended by Nathalie Bernasconi-Osterwalder, Executive Director, International Institute for Sustainable Development (IISD) Europe; Rashid S. Kaukab, Executive Director, CUTS International, Geneva; Technical Specialists, Soledad Leal, Collette Van der Ven and Rashmi Jose; along with representatives of the various ministries and the private sector.
In his presentation, Greenidge stated that had e-commerce not been an important issue in international trade and trade negotiations, it would surely have been brought to the forefront by the adjustments triggered by the COVID-19 pandemic.
E-commerce, he said, is revolutionising the manner in which the world trades and contended that such changes were “symptomatic of a paradigm shift” in global business. He pointed out that the global north has been able to embrace the opportunities of e-commerce with the help of 5G technology, artificial intelligence, and the internet of things. Consequently, in these states, e-commerce has fuelled the emergence and growth of billion-dollar companies such as Alibaba and Amazon.
However, while these activities are increasing and can represent a significant percentage of total service exports, their value in developing states is still low relative to ICT activities in high-income countries. According to the Foreign Secretary, this is an indication that there is scope to increase value addition in these activities in developing countries – hence the focus on e-commerce at the WTO. “E-commerce can be a catalyst for boosting economic transformation. It can do so by helping developing countries to shift to more high value ICT services (and related activities). At the same time, it can promote directly and indirectly the positive externalities on growth.”
Greenidge posited, however, that much of this transformative impact “remains a potential because due to lack of data on e-commerce we are not in a position to quantify actual impacts.” In order to facilitate a plugging of this gap, he noted that there have been a variety of proposals. For example, it has been proposed that all countries agree on, and use, a standard (or multiple standards) to measure trade in e-commerce. He mentioned that one issue that is becoming evident is that “those who do no embrace e-commerce are at great risk of being marginalized in global trade,” adding that “e-commerce has enabled enterprises which quickly adapt to market realities to sustain operations.”
It was noted that unfortunately, a digital divide exists which separates developed and developing countries and affects their capacity to recognise and change step to take advantage of changing circumstances. This divide, Greenidge observed, is attributable to “differing and inadequate infrastructure and capacity” in developing states which limits what is can be done technologically in terms of business activities in the developing world. In the developing world the business sector still grapples with poor infrastructure, limited e-government services, low internet penetration rates, lack of e-payment systems among other ills. These countries, he said, “… have therefore struggled to develop the necessary logistical, legal and technological capability to facilitate e-commerce and have obviously missed out on many opportunities for trade, employment and economic growth.” As he alluded to earlier, “exactly how a global regime on e-commerce can aid domestic capacity development and the measures that need to be implemented by policy-makers in developing countries are issues yet to be properly understood.”
The Foreign Secretary referenced what he termed as the recent “exponential” growth in the number of local companies offering logistics services in Guyana as an indication that Guyanese are “actively” engaged in e-commerce. However, he tempered his observation by stressing that the majority of these e-commerce transactions have been concerned with the importation of goods which he sees as a “pity” since in his opinion, the greatest potential for significant expansion is being missed. “We have seen that elsewhere, it is small and medium enterprises that have taken the greatest advantage of e-commerce and where the greatest potential for extending their reach and growing their businesses lies. We need to alter this trend, particularly since micro, small and medium sized enterprises (MSMEs) pervade our business landscape.”
Greenidge spoke of Guyana’s Green State Development Strategy and the fact that it embraces the concept of a digital economy as a way to support economic diversification, e-commerce to support micro, small and medium sized enterprises and e-government to improve access and efficiency of government services. He mentioned that pursuant to this strategy, there are several projects to develop the necessary architecture for e-commerce, informing that the latter includes the national payment system project to reduce the number of cash based transactions, the trade facilitation roadmap to reduce customs clearance time and the cost thereof. “Additionally, some initial work has begun on updating our intellectual property legislation and cybercrime legislation to protect the public online. Some of the other projects relevant in this regard have been elaborated in the situational analysis you received. You may therefore see the strides we have been making.”
He also touched on a National Study on Electronic Commerce which he said will be very helpful to Guyana. He elaborated by saying “At the national level, the situational analysis will allow us to take stock of the work done to date, to find the strengths and weaknesses of the current legal and regulatory landscape and to identify the gaps. Thereafter, we can set priorities and from this study receive some guidance on the necessary reforms to develop our e-commerce architecture.”
Greenidge told the seminar that there was also an international dimension to what they were doing and informed that the World Trade Organisation has taken up e-commerce, MSMEs and investment facilitation for development, inter alia, as part of a bundle of new issues on which to negotiate multilateral agreements. He acknowledged that although most participants would agree that e-commerce and digital trade can support economic development, especially by providing an effective way for small companies in less developed countries to engage in global trade, he reminded that conflicting views remain on the necessity of starting a negotiation around new e-commerce related rules. “In my view a global regime with equitable rules on which countries engage in these activities are needed. The specifics remain to be agreed.”
The Foreign Secretary declared that it is the government’s intention to ensure that these agreements provide technical assistance and cooperation, to help small and vulnerable economies to build capacity to benefit from trade. Furthermore, he added, since these are binding agreements under international law, States will be committing to implementation schedules in order to help address the implementation deficit. “From this study, of which this seminar is part, we will be able to develop Guyana’s negotiating position at the WTO. We will be better aware of our needs and negotiate from an informed position.”
In closing Greenidge thanked the Trade and Advocacy Fund of the British Government for selecting Guyana as one of six countries to receive support for this national study and the International Institute for Sustainable Development and CUTS International for preparing the study.
