Singapore, Chile and New Zealand are inching nearer towards the agreement promoting digital trade.
On Tuesday (21 Jan), Chan Chun Sing, the Trade and Industry Minister stated that negotiations on the Digital Economy Partnership Agreement (DEPA) have arrived at a substantial conclusion where most points have been settled.
Mr Chan remarked that there is still room for refining the wording of the agreement. Also, at the upcoming Asia-Pacific Economic Cooperation (APEC) Ministers Responsible for Trade meeting in April this year, the three countries are hoping to formally sign the agreement.
At a press conference in Singapore, Mr Chan spoke to reporters alongside Chile’s Vice Minister for Trade Rodrigo Yanez and New Zealand’s Minister for Trade and Export Growth David Parker.
In May 2019, the negotiations on DEPA commenced as it was led by the three agencies, namely, the Infocomm Media Development Authority (IMDA), the Ministry for Trade and Industry (MTI) and the Ministry for Communications and Information (MCI).
In the midst of current trade policies and rules which do not fully deal with the issues raised by the proliferation of digital trade, DEPA symbolises a “new form of economic engagement in the digital era”, Mr Chan commented.
The progress made thus far is a testament to the close collaboration and “tremendous political will” between the three nations, he added.
Mr Yanez reasoned that the agreement is required because the digitalisation of the economy is “fundamentally changing the landscape of global trade… It’s not only relevant for the big players in Silicon Valley, but also for SMEs (small- and medium-size enterprises) and developing economies like Chile.”
DEPA is adaptable depending on the circumstances, Mr Parker also remarked: “The challenge for us now is to breathe life into it.”
The three ministers agreed that DEPA would complement other continuing efforts such as Asia-Pacific Economic Cooperation (APEC)’s digital work streams, World Trade Organisation (WTO)’s negotiations for e-commerce as well as other international forums. They also welcome “other like-minded partners to participate in the DEPA.”
POSITIVES OF DEPA
According to IMDA, MTI and MCI, the agreement “establishes new approaches and collaborations in digital trade issues, promotes interoperability between different regimes and addresses the new issues brought about by digitalisation”.
DEPA seeks to address issues such as trade and investment opportunities for SMEs, paperless trading, online consumer protection and electronic invoicing.
The adoption of ethical artificial intelligence (AI) governance framework is also a goal of DEPA as the use of AI is becoming rampant in the digital economy.
The custom authorities of the three nations will also be able to exchange of electronic trade documents at the border with DEPA in place.
According to the research by the tech firm IBM and container shipping giant Maersk, processing trade documents costs as much as 20 per cent of the cost of moving goods.
DEPA will also help facilitate and foster the electronic exchange of trade documents for business-to-business (B2B) transactions and customs clearances between the three nations.
For the e-invoicing systems, the three countries are encouraged to adopt standards akin to the international Peppol (Pan-European Public Procurement Online) electronic invoicing framework under the DEPA. This will enable more cost-effective and faster payments and invoices can be transmitted in a structured digital format.
The greater regional use of e-invoicing and the signing of DEPA are expected to cut operating costs as companies will not need to spend as much on manually processing different invoice formats from its suppliers.
The Singapore Business Federation (SBF) is accepting of the promotion of inclusivity and the focus on the needs of SMEs under DEPA: “Digitalisation and interoperability of regulatory compliance and business transactions in cross-border trade will help our companies reduce both cost and time-to-market, enhancing their global competitiveness.”
The inaugural CNA Digital Economy Leadership Summit 2020 will take place in March later this year where 200 key individuals from the private sector, the Government and diplomatic circles from around Asia will gather to tackle issues such as how to manage talent and ensure sustainability in the digital economy and how to grow and innovate in a digital economy.
For more information, visit cna.asia/leadership-summit