DDG Hill noted that trade, especially in services, is an important part of the digital economy She pointed out that global exports of digitally delivered services reached USD 3.82 trillion in 2022. This is an almost fourfold increase in value since 2005 and accounted for 54 per cent of total global services exports. Of these, digitally traded services in the financial sector accounted for 16 per cent.
DDG Hill explained that liberalization of services trade can have a positive impact on access to finance, especially in developing countries. Through trade in financial services, micro, small and medium size enterprises (MSMEs), women and young people can gain access to finance mechanisms that bypass traditional barriers to capital. Technology-enabled digital lending, working capital and crowdfunding platforms are examples of how digital trade in services can offer an alternative means to address these financial constraints.
As regards digital trade more generally, DDG Hill underscored the opportunities it can provide for MSMEs, particularly in developing countries and LDCs. She mentioned reduced barriers to market entry and enhanced access to global markets as two examples of how digital trade can benefit small firms. She also noted that MSMEs in developing economies have been found to account for a relatively larger share in total exports as internet access improves.
DDG Hill further pointed out that digital trade can boost economic participation of women and young people. She referred in this regard to the findings of a joint report by the International Monetary Fund, the Organisation for Economic Cooperation and Development, the UN Conference on Trade and Development, the World Bank and the WTO. According to this report, women entrepreneurs are relatively more present online than offline. This is because digital technologies can help women and young people overcome traditional barriers to market entry, such as time and mobility constraints. This, in turn, benefits their families and communities.
Finally, DDG Hill noted that, just as trade can facilitate access to digital finance, better financing opportunities can boost trade. She highlighted model simulations conducted by the WTO, together with the International Finance Corporation, showing that improving access to trade finance, including through digital means, could increase West-African countries’ trade by as much as 16 per cent, or USD 26 billion. Similar simulations conducted for the Mekong region show a potential for boosting these countries’ trade by up to 8 per cent on average, or USD 58 billion. Details of these simulations are available in the joint publications by the WTO and IFC on Trade Finance in West Africa and Trade Finance in the Mekong Region.
Panelists at the event included Gerrit Sindermann (Green Digital Finance Alliance and Green Fintech Network), Michael Kende (Datasphere Initiative and Analysis Mason) and Igor Litvinyuk (United Nations Economic Commission for Europe), who discussed the question of leveraging the digital economy for inclusive and sustainable economic growth. The discussion was moderated by Pio Wennbust from the Swiss Federal Department of Foreign Affairs.
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