What signal does China send by deciding to apply for membership in the Digital Economy Partnership Agreement?

According to Xinhua News Agency, President Xi Jinping attended the first phase of the 16th G20 Leaders' Summit in Beijing on the 30th and delivered an important speech.

According to Xinhua News Agency, Xi Jinping stressed that China attaches great importance to international cooperation in the digital economy, has decided to apply for membership in the Digital Economy Partnership Agreement, and is willing to work with all parties to promote the healthy and orderly development of the digital economy. The G20 should share the responsibilities of the digital age, accelerate the construction of new digital infrastructure, promote the deep integration of digital technologies with the real economy, and help developing countries eliminate the "digital divide". China has put forward the Global Data Security Initiative, and we can jointly explore the formulation of international rules for digital governance that reflect the wishes of all parties and respect the interests of all parties, and actively create an open, fair, just and non-discriminatory digital development environment.

The Digital Economy Partnership Agreement (DEPA), signed by Singapore, New Zealand and Chile in June 2020, aims to strengthen digital trade cooperation among the three countries and establish a normative digital trade agreement. The agreement focuses on the facilitation of e-commerce, the liberalization of data transfer, and the security of personal information, and stipulates the strengthening of cooperation in areas such as artificial intelligence and financial technology.

Zhou Nianli, a professor at the China World Trade Organization Research Institute of the University of International Business and Economics, told the first financial reporter that China chose to apply for dePA at this time, on the one hand, because DEPA itself is innovative, and some of its contents are in line with China's demands, on the other hand, joining DEPA will also help expand China's discourse power in the field of digital trade governance.

<b>Modular protocol</b>

"At present, in the governance of international digital trade, we often talk about the three representative concepts of the voice of the United States, the voice of China and the voice of the European Union. In fact, we usually ignore the fourth type of sound, which is the sound of Singapore. Singapore's ideas and demands on digital trade governance are mainly reflected in two aspects, one is DEPA, and the other is the Digital Economy Agreement (SADEA) signed between Singapore and Australia last year. Zhou Nianli further explained that Singapore's industrial base supporting the development of digital trade and the overall development of its digital trade are not the same as those in Europe and the United States, so there are some unique demands in digital trade governance.

She said: "For example, Singapore does not have a large technology giant, mostly innovative enterprises, so Singapore pays more attention to the development and cooperation of small and medium-sized enterprises, pays more attention to the industry standard design and some ethical constraints in some cross-cutting and emerging fields, which is also the advanced nature of DEPA." In addition, from the perspective of content, DEPA also pays more attention to the improvement of the level of digital trade facilitation. ”

In addition to this, a major feature of DEPA is the modular protocol. "That is to say, you don't have to agree to the entire content of DEPA, you can add any module you want, it's like building a building block puzzle mode, you can join several of them." Zhou Nianli said, "So, whether it is from the content design of DEPA or the structure of the entire agreement, DEPA has its innovation." ”

Lu Jing, a professor of economics at Zhejiang University and deputy director of the Department of Economics and Trade of the People's Republic of China, recently explained at the second China Pilot Free Trade Zone Development Forum that DEPA "is on the basis of the fight between big countries, small countries have made a puzzle of American and European templates, spelled out 16 chapters, and then said which module you can accept first sign which module, and if you can't accept it, it will be a small goal."

According to the official website of the New Zealand Ministry of Foreign Affairs and Trade, DEPA has designed more than ten modules covering topics such as business and trade facilitation, processing of digital products and related issues, data issues, business and consumer trust, emerging trends and technologies, innovation and the digital economy, SME cooperation and digital inclusion.

Matthew P. Goodman, senior vice president of the Center for Strategic and International Affairs (CSIS), a U.S. think tank, has previously commented that DEPA is a non-binding commitment to deepen cooperation in the digital economy as a platform for discussing non-binding principles and best practices, rather than a formal trade negotiation, so DEPA makes it possible to experiment and quickly solve new problems.

Goodman said that while THE DEPA arrangement is not binding, this "soft" approach to rulemaking has proven effective on an Asian scale. Because of this, if other countries want to connect with DEPA, they can quickly begin to form rules and regulations in key areas, rather than entering the long process of formal trade negotiations.

In September this year, South Korea informed other DEPA members, including New Zealand, of their intention to join. South Korea said that DEPA is likely to develop into a new global digital system and become a platform for more countries to participate widely.

Why choose to apply now to join DEPA

With the rapid development of digital technology, the field of digital trade is rapidly filling the gap in the regulation of rules. Lu Jing introduced that in recent years, the Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP), the Us-Mexico-Canada Agreement and the US-Japan Digital Trade Agreement have been successively concluded. She said: "This is also gradually upgrading, and by the end, the agreement has paid less attention to cross-border e-commerce, and more attention has been paid to technical issues." ”

Xinhua News Agency reported that on September 8, 2020, State Councilor and Foreign Minister Wang Yi delivered a keynote speech entitled "Uphold Multilateralism, Advocate Fairness and Justice, and Work Together for Win-Win Cooperation" at the high-level meeting of the International Symposium on "Seizing Digital Opportunities and Seeking Cooperative Development", proposing the Global Data Security Initiative.

Zhou Nianli told the first financial reporter: "In the scope of data governance, we still always put national security and industrial security in a more important position. The security and controllability of data is a prerequisite for the cross-border flow of data, and it is necessary to find a balance between the free flow of data and our security goals. ”

So why did China choose to apply to join DEPA at this time?

Zhou Nianli believes that different countries have different emphases in the field of digital trade governance based on their respective industrial backgrounds and domestic economic development levels. As an Asian country, Singapore has some of the demands and concepts of digital trade governance in line with China, and the content of DEPA itself is also innovative.

"For example, the United States prefers the level of liberalization of digital trade because it is a big and powerful country in digital trade, while the European Union may pay more attention to privacy protection and strengthen the responsibility of platforms, such as collecting digital services tax." China, on the other hand, pays more attention to security issues. Singapore pays more attention to promoting scientific and technological innovation, and its concept is more conducive to digital technology innovation and promoting cooperation among small and medium-sized enterprises, including government data disclosure. In fact, there are different emphases between these ideas, and there are also overlaps in the overall view, not to say that they are completely contradictory. Zhou Nianli said that although the "four voices" have different emphases, they can still learn from each other.

Zhou Nianli cited DEPA as an example: "In the field of promoting the facilitation of digital trade, DEPA proposes that within the three major systems of electronic contract systems, invoice systems and payment systems, interoperability should be improved between each other's members. In other words, DEPA has proposed some good institutional innovations in digital trade facilitation, which is still similar to China's demands. ”

Zhou Nianli believes that China's application to join DEPA can absorb Singapore-style digital trade governance and some practices worthy of reference on the one hand, and on the other hand, it can further consolidate China's influence in the field of digital trade governance in Asia. "China is also a digital trade power, and it is also necessary for China to export chinese templates of digital trade rules to the world, which should be an important achievable goal." Zhou Nianli said.