China joins WTO talks on $25 trillion ecommerce sector
In a last-minute twist, China reversed a decision to sit-out World Trade Organisation (WTO) talks that centre on instituting a digital trade accord. Initially, China (quite likely the world’s single most important ecommerce market) had chosen to miss the talks – not particularly surprising given the harsh restrictions the country places upon internet use. However, in a statement emailed to Bloomberg last Friday, China’s ambassador to the World Trade Organisation, Zhang Xiangchen, said that the country had reversed that decision due to a “broader crisis” engulfing the WTO as a result actions undertaken by Donald Trump’s administration in the US.
China is forecast to overtake the US as the world’s top retail market this year
Source: Bloomberg, eMarketer
Note: 2019 – 2022 are forecasts; figures for both countries exclude travel and event tickets, while China data also excludes Hong Kong market.
Zhang wrote: “The multilateral trading system is in a deep crisis. Against this backdrop, the launching of ecommerce negotiation will in a significant way help reinvigorate the negotiating function of the WTO, and shore up confidence in the multilateral trading system and economic globalization.”
According to Cecilia Malmstrom, the EU’s top trade negotiator, China’s inclusion is necessary to give these talks greater weight. The country will probably see digital sales hit $5.5 trillion this year. She said: “It shows that the WTO is still alive and that we can take on board one of the biggest challenges on global trade – ecommerce.” She added that the talks will now include countries predicted to account for 90% of all digital trade this year.
However, some commentators think it is not before time that the WTO engaged in such discussions. Simon Birmingham, the Australian trade minister, said: “If anything this is an initiative that started too late because the reality is that ecommerce and digital trade are here, they’re big, and there is an inevitability that the way in which commerce occurs around the world is going to be influenced more heavily by the digital economy.”
Dominion’s Global Trends Ecommerce Fund is unique in its focus upon the world’s fastest-growing, and most disruptive, global trend.
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