Author: Arvind Panagariya

Publisher: United Nations Conference on Trade and Development

Published: 2000

Total Pages: 42

ISBN-13:

This paper discusses the policy issues that e-commerce raises for the World Trade Organisation (WTO) and developing countries. Electronic commerce offers unprecedented opportunities to both developed and developing countries. In the short term, due to lack of infrastructure in the developing countries, the gains are likely to be concentrated in the developed countries. In the long term, the developing countries have more to benefit and they can gain by skipping some of the stages in development of information technology through which developed countries have had to pass. The author has three policy proposals for developing countries. First, that it would be most appropriate to classify e-commerce as trade with services with GATS discipline applied to it. Classifying e-commerce as goods trade with a permanent zero custom duty pact would liberalise all e-commerce by default, undermining the bargaining power of developing countries. Secondly Internet transactions would be best classified as cross-border trade rather than consumption abroad. The last proposal is that developing countries with the capacity to export skilled services through the Internet, should aggressively negotiate market access with developed countries in the future WTO negotiations aiming to seek liberalisation in the sectors in which they have comparative advantage and recognition of their education, qualifications and skills etc.