The Group of Seven (G7) wealthy nations reached a breakthrough on a joint set of principles to govern cross-border data use and digital trade.
Trade ministers of the seven countries, who met in London, arrived at a consensus on the ‘G7 Digital Trade Principles’. Britain said that the principles could liberalize hundreds of billions of dollars of international commerce.
In a statement issued following the meeting, concerns were marked over domestic policies related to data encryption and data localization.
The deal sets out a middle ground between highly regulated data protection regimes used in European countries and the more open approach of the US.
“We oppose digital protectionism and authoritarianism and today we have adopted the G7 Digital Trade Principles that will guide the G7’s approach to digital trade,” the communique published by Britain said.
Digital trade is broadly defined as trade in goods and services that is either enabled or delivered digitally, encompassing activities from the distribution of films and TV to professional services.
According to a government study of official data, the remotely delivered trade for Britain alone was worth $448.09 billion in 2019, or a quarter of all its trade.
But differing rules governing the use of customer data can create significant barriers, particularly for small and medium-sized businesses for whom compliance is complicated and costly.
The deal agreed last day by the G7, which comprises the US, Japan, Germany, Britain, France, Italy and Canada, is a first step in reducing those barriers, and could lead to a common rulebook of digital trade.
The principles covered are open digital markets, cross-border data flows, safeguards for workers, consumers, and businesses, digital trading systems, and fair and inclusive global governance, the statement said.
“We should address unjustified obstacles to cross-border data flows while continuing to address privacy, data protection, the protection of intellectual property rights, and security,” communique noted.
A British official with knowledge of the deal said, “This agreement is a genuine breakthrough that is the result of hard diplomatic graft. All of us rely on digital trade every day, but for years the global rules of the game have been a wild west that has made it difficult for businesses to seize the immense opportunities on offer.”
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