G20 and covid-19: the key is to go digital

The coronavirus pandemic that, starting last January, swept across the world and that does not seem to stop, has had important implications not only in the everyday life, but also and above all on an economic level, with repeated strong setbacks in different sectors. 

G20, the forum organized each year to promote international financial stability and deal with issues related to the industrialization of the planet, and that this year will take the form of a video conference chaired by King Salman bin Abdulaziz Al-Saud, will focus on the implications of the coronavirus in the economic and financial sphere.

Trade is facing the worst crisis of the last 50 years, and for this reason one of the main points of G20 is about how to avoid that the measures taken to face the pandemic are an obstacle to the recovery, thus favoring  trade through, for example, trade facilitation and tariff elimination.

The main topic of G20 concerns precisely the transition to digital, which made even more evident the need to reform a regulatory framework (that of the WTO) designed for an industrial economy based on the global competition typical of the late twentieth century and that is ill-suited to an international economy now based on digital technologies, intellectual property and the circulation of data.

The pandemic seems in fact to have accelerated quite a lot this transformation that was already taking place. On the one hand since it has favored digital trade over physical trade, on the other hand because it has shown that services based on digital offer such as telecommunications, IT services and digital entertainment came out more unscathed than others, like the tourism sector, and even strengthened by this new reality that takes us further and further away from each other.

What emerged in the last months is that the companies that had already completed their digital transition were better able to stay on their feet, while small and medium-sized enterprises that delayed their switch to the digital world had much more trouble, thus exacerbating the gap between digitilized companies and those that are still in the “analogue world”.

On this matter, the aim is to accelerate trade digitalization, helping SMEs by allowing them to reduce costs and become more resistant to possible future economic crises.

There is also talk of a global digital connectivity that would favor the access to resources and information. One of the objectives is in fact the development of an economic rules and regulatory framework that takes into account digital economy and its extension to developing countries.

In other words, the economy goes digital also in order to become stronger, but it needs a series of regulations governing all the areas linked to digitization such as privacy issues, consumer protection and the new kind of global competition. A global negotiation for national and international governance systems that include service governance obligations is therefore expected from the WTO.

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