01 Apr 2019
REMARKS BY AMBASSADOR TAN HUNG SENG
SINGAPORE’S PERMANENT REPRESENTATIVE TO THE WTO AND WIPO
1 APRIL 2019
PALAIS DES NATIONS, ROOM XXI
Good afternoon distinguished guests and colleagues. I wish to thank the organizers for inviting me to join you on this panel. This is an important and timely initiative. It is important because E-Commerce is an increasingly significant driver of economic growth and international trade. Globally, E-Commerce is expected to grow at more than 20% Compound Annual Growth Rate (CAGR) through 2022, reaching $5.8 trillion[1]. It is also timely because as small developing countries, it is imperative that we recognize and respond to the reality of the digital transformation that is changing the way we live, work, shop and play.
E-Commerce in Singapore
First, let me share with you briefly how Singapore is trying to become E-Commerce ready. As you know, Singapore is a small country with a small domestic market. Consequently, like many CARICOM Members, Singapore is also highly trade-dependent. This is evident from our high trade to GDP ratio. In fact, Singapore’s total trade is approximately 300% or three times our GDP. We therefore need to continue being outward-looking and internationally-oriented to sustain growth. In this context, E-Commerce has provided our Micro Small and Medium Enterprises (MSMEs) with the means to rapidly reach markets all around the world.
The Singapore Government is making concerted efforts to support our MSMEs in their digitalisation efforts. Like many CARICOM Members, MSMEs represent an important pillar of our economy. They make up 99% of our companies, contributing 50% of our GDP[2]. Hence, a vibrant MSME sector is an important engine of growth for our economy. One of our key initiatives is the “SMEs Go Digital Programme”, which was launched in April 2017[3]. The primary objective of the programme is to support Singapore MSMEs’ efforts to tap the potential of E-commerce by going digital. The programme provides support in the areas of project management and the creation of industry digital plans[4].
It is heartening that Singapore’s MSMEs have responded positively to the programme. In fact, the number of MSMEs participating in the IMDA programme has jumped from just 650 in January 2018 to 4,000 SMEs at the end of January 2019.
Equally important, the Singapore Government has taken steps to create an enabling eco-system to support E-Commerce. Besides establishing the necessary infrastructure such as 5G, we have introduced the Industry Transformation Programme[5], which is designed to develop dynamic sectoral plans to address the changes in the economic environment, including changes caused by technological advances. This is complemented by schemes to encourage enterprises to focus on skills upgrading[6] since equipping the work force with the right digital skills is imperative. All these efforts are intended to build a digitally-savvy business community.
E-Commerce in ASEAN
Second, let me turn to ASEAN, which comprises 10 Member States, namely Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Philippines, Thailand and Vietnam. Collectively, ASEAN is the world’s fastest growing internet market, with 330 million internet users. By 2025, ASEAN’s internet economy is set to quadruple to US$200 billion from US$50 billion in 2017.
As the value of E-Commerce multiplies, the need to establish trade rules to govern these practices becomes more important. In this context, ASEAN recently concluded the Agreement on Electronic Commerce in November 2018. The agreement aims to facilitate cross-border E-Commerce transactions, create an environment of trust and confidence, while deepening cooperation among ASEAN Member States to further develop and intensify the use of E-Commerce to drive regional economic growth. Key elements of the Agreement include “Domestic Regulatory Framework”, “Transparency”, “Cooperation”, “Logistics” and “Consumer Protection and Privacy”. These are fundamental aspects of building an environment that is conducive for E-Commerce.
Importance of the JSI
Third, I will briefly highlight the JSI on E-Commerce and its efforts towards reaching agreement on multilateral E-Commerce rules. During the Ministerial meeting in Davos in January 2019, a group of 76 WTO Members, representing 90% of global E-Commerce, announced their intention to commence WTO negotiations on E-Commerce. This marked a significant step towards updating international trade rules to keep pace with the realities of the digitalization of trade.
As one of the Co-Convenors of this initiative, Singapore is encouraged that the JSI involves a wide range of WTO Members, both large and small, developed and developing. We are particularly encouraged by the LDCs which have joined the JSI. These include ASEAN Member States like Myanmar and Laos. Their participation underscores the necessity for all countries, regardless of size and state of development, to work together to set the rules of E-Commerce and equally important, to harness its potential.
But the road ahead will not be easy. On the contrary, the forthcoming negotiations will be complex and challenging. With the diverse range of co-sponsors, there are naturally differing levels of ambition and expectations. We must not underestimate the challenges, but I can assure you that the three Co-Convenors, Australian, Japan and Singapore, are committed and determined to do our best to advance the negotiations.
Allow me to conclude by saying that while I recognize the challenges, I am also cautiously optimistic for two reasons. One, I believe that every one of the 76 co-sponsors share the view that the WTO must respond to the unrelenting march of E-Commerce. We cannot afford to do nothing. Two, I believe that the co-sponsors also recognize that time is not on our side. The pace of digital transformation is so relentless and rapid that we must complete the negotiations in a timely fashion. Otherwise, if we take too long, what we agree on will become a useless piece of paper, overtaken by technological changes. In short, it is incumbent upon us to work swiftly towards a positive outcome, in order to address fast-evolving business realities. Given the urgency of this task ahead of us, we will have to be creative in finding solutions, and be guided by the common goal of leveraging E-Commerce to deliver economic and social improvements for our people. Thank you.
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[1] “Global Digital Commerce Sales to Near $6 Trillion by 2022”, Forbes, 11 September 2018
[2] www.gov.sg/news/content/smes-have-you-heard-the-good-news
[3] Spearheaded by the Infocomm Media Development Agency (IMDA).
[4] The SME Go Digital Programme was announced in 2017 to help SMEs build strong digital capabilities to seize the opportunities for growth in the digital economy. The key features of the programme include (i) a step-by-step guide for MSMEs on digital solutions through Industry Digital Plans, (ii) Proven MSMEs-Friendly Pre-Approved Solutions (these solutions have been assessed by IMDA to be effective, market-tested and cost-effective, supported by reliable vendors), (iii) consultancy services via MSMEs Digital Tech Hub which is a dedicated hub that provides basic advice on proven digital solutions and (iv) project management services to help MSMEs maximise implementation of digital projects.
[5] Focus areas include manufacturing, professional services, lifestyle, essential domestic services (eg. healthcare, education), trade and connectivity and the built environment.
[6] “Singapore Industry Initiatives for E-Commerce”, 9 July 2018, EDB
