Could you briefly introduce your work at the WEF?

At the World Economic Forum Centre for the Fourth Industrial Revolution in San Francisco we focus on technology governance, and working with the public and private sectors to design and implement the best policy approaches. My job is to look at how digital trade, including digital goods and services like e-commerce or Zoom, digital payments and data flows are impacting and transforming the world. Another part of our work is in the digitizing of trade, or TradeTech, which focuses on how emerging technologies are changing global trade.

What does “digitizing trade” mean?

Digitizing trade cannot just go from zero to 100, or from nothing to full automation, there are many steps in the process and at least two layers. The first layer is when trade data and processes are transformed from analogue to digital; the second layer is when trade process optimization and synchronization occurs. That’s when one can apply emerging digital technologies such as blockchain, AI, IoT, or VR on top of the first layer. We found out that the biggest barrier to adoption is the inconsistency in technology regulations across jurisdictions, followed by digital illiteracy and the lack of necessary skills in the labour force. Other factors are data oligopolies and market fragmentation. With digitization, we also need to consider how technology can make trade more inclusive and more equitable.

What are the current global policy frameworks setting the standards for digital trade?

Emerging technologies are moving at such a rate that industries and regulators are struggling to keep up, so there is a gap between the advance of tech and the current policy frameworks; for instance, despite the growing uptake of drone technologies, few countries have a comprehensive policy to regulate drones.

Trade has traditionally been a paper-intensive industry, most countries still requiring stamped documentation at customs checks. However, countries like Singapore are taking action to redress this. Just last month, Singapore passed its Electronic Transactions (Amendment) Bill, legalizing the digitization of trade documents. Singapore is one of the first countries to be doing this, which shows the technology-regulation gap does not pertain to advanced technologies only, but also the simple translation from paper to digital.

Even for technologies like e-commerce, which has been around for many years, the current policy landscape is still patchworked. At a global level, there is an ongoing negotiation on trade rules for e-commerce with over 80 WTO member countries. In addition, Singapore signed the Digital Economy Partnership Agreement (DEPA) with Chile and New Zealand in 2020, a forward-looking agreement that we hope to see more of from other parts of the world.

While the pandemic brought the trade of physical goods to a halt, what has been the dynamic for digital trade?

It is difficult to pin down how much of what we refer to as trade is made up by digital trade, given the elusiveness of the concept itself, but it is clear that digital trade is a growing segment. Trade in services has grown 60% faster than trade in goods in the last 10 years, while cross-border data flows increased by many times the past decade. Since the pandemic has started, some experts have argued that we have witnessed five to seven years of digitization progress in just one year. For example, we have seen a surge in digital payments in the last year; card companies are reporting double digits growth in transactions globally.

Is the trend towards protectionism and trust barriers more accentuated in digital trade compared to physical trade?  

We see two intertwined trends globally: the first one is that the internet is global, it creates interconnectedness, which comes with a certain liberalization. In parallel, we also see a growing protectionism tide, which is linked to a lack of trust, but also a lack of harmonized rules. I can say that within the “globality” created by the internet, there are also digital islands and greater data fragmentation, and this tension is likely to continue.

How do you see the issue of digital inclusiveness playing out, now that we depend more and more on digital tools?

The pandemic has pushed the digital divide into greater focus: internet access has become a basic condition to participate in education or employment. There are worrying discrepancies between countries: internet penetration is at 87% in developed nations, 47% in developing nations, and only 19% in the least developed nations, so enabling digital infrastructure is crucial.

What are some key technologies that may impact the chemical industry?

Amongst the top technologies that will shape international trade, we identified IoT, digital payments, e-commerce platforms, cloud computing, and 5G. In the chemicals industry, digital platforms are increasingly more popular, which creates a more transparent and inclusive environment for buyers and sellers. An interesting technology will be 3D printing and how, when grown to a greater scale, it could shape chemicals trading. 3D printing is still a niche technology, but the question of how this may affect the industry is very pertinent for the future.

Singapore will host the WEF Special Annual meeting for the first time in 2021. What are your thoughts on Singapore’s future in digital trade?

Singapore is a true leader when it comes to digital trade and the recent policy developments speak for themselves; I believe these developments will open great opportunities, as well as paving the way for other countries to follow suit. We look forward to more collaboration with Singapore on advancing digital trade.