UNCTAD claims developing countries are lagging in digital data flow

The United Nations Conference on Trade and Development (UNCTAD) has called on countries to make digital data flow for the benefit of all.

On this, UNCTAD said the world needs a new global governance approach to enable digital data to flow across borders as freely as necessary and possible.

The UN trade and development body said the new approach should help to maximise development gains, ensure those gains are equitably distributed and minimize risks and harms.

It should also enable worldwide data sharing, develop global digital public goods, increase trust and reduce uncertainty in the digital economy.

According to the Digital Economy Report 2021 by UNCTAD, it revealed that the new global system should also help avoid further fragmentation of the Internet, address policy challenges emerging from the dominant positions of digital platforms and narrow existing inequalities.

UN Secretary-General, António Guterres, in his preface to the report, said it is more important than ever to embark on a new path for digital and data governance.

“The current fragmented data landscape risks us failing to capture the value that could accrue from digital technologies and it may create more space for substantial harms related to privacy breaches, cyberattacks and other risks,” he stated.

To UNCTAD Secretary-General, Rebeca Grynspan, the globe urgently needs a renewed focus on achieving global digital and data governance, developing global digital public goods, increasing trust and reducing uncertainty in the digital economy.

Grynspan said the pandemic has shown the critical importance of sharing health data globally – the issue of digital governance can no longer be postponed.

The UN body observed that digital data play an increasingly important role as an economic and strategic resource, a trend reinforced by the COVID-19 pandemic.

It said the pandemic has shown the importance of sharing health data globally to help countries cope with its consequences, and for research purposes in finding vaccines.

The report warned that a data-related divide is emerging as the data-driven digital economy evolves, resulting in many developing countries becoming mere providers of raw data to global digital platforms, while having to pay for the digital intelligence generated from their data.

The US and China are the frontrunners in harnessing data, according to the report. They account for 50 per cent of the world’s hyperscale data centres, the world’s highest rates of 5G adoption, 70 per cent of the world’s top artificial intelligence (AI) researchers and 94 per cent of all funding for AI startups.

The two countries also make up about 90 per cent of the market capitalisation of the world’s largest digital platforms, and during the pandemic, their profits and market capitalization values have surged tremendously.

For the world’s top seven digital platforms, between October 2019 and January 2021, stock prices rose by between 55 per cent (Facebook) and 144 per cent (Apple).

UNCTAD Deputy Secretary-General Isabelle Durant, said: “The increased interconnection and interdependence challenges in the global data economy call for moving away from the silo approach towards a more holistic, coordinated global approach.

“Moreover, new and innovative ways of global governance are urgently needed, as the old ways may not be well suited to respond to the new context.”
UNCTAD proposed the formation of a new United Nations coordinating body, with a focus on, and with the skills for, assessing and developing comprehensive global digital and data governance. Its work should be multilateral, multi-stakeholder and multidisciplinary.

It should also seek to remedy the current underrepresentation of developing countries in global and regional data governance initiatives.

The body should also function as a complement to and in coherence with national policies and provide sufficient policy space to ensure countries with different levels of digital readiness and capacities can benefit from the data-driven digital economy.

The report said the current global context is characterized by diverging approaches to data governance, notably by the three leading players – the United States, China and the European Union (EU).

The US approach focuses on control of data by the private sector, the Chinese model emphasizes control of data by the government, while the EU favours control of data by individuals, based on fundamental rights and values.

UNCTAD’s director of technology and logistics, Shamika N. Sirimanne, said the absence of a global data governance framework hampers countries’ ability to reap benefits from the digital economy.

It also hinders their ability to protect the privacy of people from both private sector and government use of data, and to address concerns related to law enforcement and national security.

“We need a new regulatory framework that factors in both economic and non-economic dimensions, and that can work for countries at different levels of digital readiness,” Ms. Sirimanne said.

She noted that the new approach would allow countries to better harness data as a global public good, agree on rights and principles, develop standards and increase international cooperation.

And while more attention is given to data at the international level, the international debate on the governance of cross-border data flows is at an impasse due to diverging views and positions on their regulation. The proposed new global data governance approach could contribute towards developing a middle-ground solution.