News / Economy

Report: US Boosted by Digital Trade, but Barriers Remain

FILE - The new Google Nexus 7 tablet, made by Asus is displayed during a Google special event at Dogpatch Studios in San Francisco, California, July 24, 2013.
FILE - The new Google Nexus 7 tablet, made by Asus is displayed during a Google special event at Dogpatch Studios in San Francisco, California, July 24, 2013.
Reuters
A new U.S. government report on Thursday highlighted both the growing importance of digital trade to the United States and a long list of trade barriers that American internet and other online companies face around the world.
 
“The increase in digital trade is having a significant impact on the U.S. and global economy,” the U.S. International Trade Commission (ITC) said in the first of two reports on the issue requested by Senate Finance Committee Chairman Max Baucus at the urging of Senator Ron Wyden, both Democrats.
 
“This report shows that the digital economy represents an American trade advantage but it also identified barriers that are stifling further growth,” Wyden said.
 
As U.S. trade negotiators pursue free trade agreements in Europe and the Asia-Pacific region, “it is important that these barriers are addressed so that U.S. digital trade can reach its full potential as a driving force behind the U.S. economy,” the Oregon senator said.
 
The study comes as the United States is pushing in trade talks to open new markets for leading U.S. internet companies like Amazon, Apple, Facebook, Google and Microsoft, which have already helped make the United States the world's largest exporter of digital services.
 
That has become more complicated after revelations that the National Security Agency was mining personal data from top U.S. internet companies including under a secret program named Prism.
 
The Washington-based Information Technology and Innovation Foundation this month estimated U.S. cloud computing providers could lose $21.5 billion to $35.0 billion in revenue over the next three years if foreign customers decide the risk of storing data with a U.S. company outweighed the benefits.
 
The German government responded this week to concerns raised by the Prism surveillance program by agreeing on initial plans to boost European technology companies and make them a more favorable alternative to U.S. peers.
 
In its report, the ITC acknowledged the difficulty of estimating digital trade because of the lack of a standard definition and shortcomings in available data.
 
But U.S. exports of “digitally-enabled” services, one measure of digital trade, totaled $356.1 billion in 2011, a 26 percent increase from $282.1 billion in 2007, covering areas such as financial services, retail services, professional services, healthcare, logistics and education, the ITC said.
 
Europe, with its strong internet infrastructure, is the most important digital trading partner for the United States and is also an important destination for U.S. digital trade-related foreign direct investment, the ITC said.
 
One impediment to increased trade are foreign government  policies that compel digital companies to use local data servers, technology and inputs or that provide procurement preferences for local firms, the report said.
 
Many “localization” requirements are justified on data privacy grounds, and it is often challenging to determine whether they are imposed for that purpose or to favor the country's domestic firms, the ITC said.
 
Different approaches to data privacy protection can also be an obstacle to trade, an issue that U.S. firms hope to address in talks with the 27-nation European Union on the proposed Transatlantic Trade and Investment Partnership pact.
 
In another area, U.S. music, book, software and movie companies view digital piracy of copyrighted material as their biggest obstacle to increased online exports, while “internet intermediaries” such as Google and Facebook are more concerned about foreign laws that could hold them liable for the actions of users on their networks.
 
In one instance, “the Italian government brought a criminal case against several Google executives for a video posted by a YouTube user that showed the bullying of a disabled student, despite the fact that Google had a notice and take-down system in place that resulted in the prompt removal of the video from the site,” the ITC said.
 
U.S. digital companies complain that censorship in countries including China, Vietnam and Saudi Arabia also hurts their business operations, as do restrictive immigration policies and complicated customs procedures, the ITC said.

You May Like

For Lebanon-based Refugees, Desperation Fuels Perilous Passage

In a war that has caused an estimated three million people to flee Syria, efforts to make perilous sea journey in search of asylum expected to increase More

South African Brewer Tackles Climate Change

Mega-brewer SAB Miller sent delegates to climate summit in Peru, says it is one of many private companies taking their own steps to fight climate change More

Indonesia Reports Increase in Citizens Joining Islamic State

Officials say more than 350 of its citizens are now in Syria or Iraq to fight with Islamic State - 50 more than last month More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Will Pakistan School Shooting Galvanize Pakistan Against Extremism?i
X
Ayesha Tanzeem
December 17, 2014 11:54 AM
The attack on a military school in Pakistan’s northwest city of Peshawar left 141 dead, including 132 children. Strong statements of condemnation poured in from across the world. The country announced three days of mourning, and the leadership, both political and military, promised retribution. VOA's Ayesha Tanzeem looks at how likely the Pakistani government is to clamp down on all extremist groups.
Video

Video Will Pakistan School Shooting Galvanize Pakistan Against Extremism?

The attack on a military school in Pakistan’s northwest city of Peshawar left 141 dead, including 132 children. Strong statements of condemnation poured in from across the world. The country announced three days of mourning, and the leadership, both political and military, promised retribution. VOA's Ayesha Tanzeem looks at how likely the Pakistani government is to clamp down on all extremist groups.
Video

Video ‘Anti-Islamization’ Marches Increase Tensions In Germany

Anti-immigrant rallies in Germany have been building in recent weeks, peaking Monday night in the city of Dresden where tens of thousands of people turned out to demonstrate against what they call the ‘Islamization’ of the West. Germany has offered asylum to more Syrian refugees than any other country, and this appears to have set off the protests. Henry Ridgwell reports from London.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.
Video

Video Refugees Living in Kenya Long for Peace in the Home Countries

Kenya is host to numerous refugees seeking safe haven from conflict. Immigrants from Somalia face challenges in their new lives in Kenya. Ahead of International Migrants Day (December 18) Lenny Ruvaga has more for VOA News from the Kenyan capital.
Video

Video Turkey's Authoritarianism Dismays Western Allies

The Turkish government has been defiant in the face of criticism at home and abroad for its raids targeting opposition media. The European Union on Monday expressed dismay after President Recep Tayyip Erdogan lashed out at Brussels for criticizing his government's action. Turkey's bid to be considered for EU membership has been on hold while critics accuse the NATO ally of increasingly authoritarian rule. Zlatica Hoke reports.
Video

Video US-China Year in Review: Hong Kong to Climate Change

The United States is pushing for a code of conduct to resolve territorial disputes in the South China Sea as it works to improve commercial ties with Beijing. VOA State Department correspondent Scott Stearns reports on a year of U.S. policy toward China from Hong Kong to climate change.
Video

Video Japanese Leader’s Election Win Raises Potential for Conflict with Neighbors

Japan’s Prime Minister Shinzo Abe and his allies easily won a two-thirds majority in parliament Sunday, even though the country has slipped into recession under his conservative policies. VOA’s Brian Padden reports from Seoul, that the prime minister’s victory will empower him to continue economic reforms but also pursue a nationalist agenda that will likely increase tensions with Japan’s neighbors.
Video

Video Nuba Mountain Families Hide in Caves to Escape Aerial Bombings

Despite ongoing peace talks between Sudan's government and the rebel Sudan People’s Liberation Movement-North, or SPLM-N, daily aerial attacks continue in South Kordofan province’s Nuba Mountains. Adam Bailes was there and reports for VOA that government forces are targeting civilian areas, rather than military positions, with their daily bombardments.

All About America

AppleAndroid

World Currencies

EUR
USD
0.8033
JPY
USD
117.19
GBP
USD
0.6372
CAD
USD
1.1634
INR
USD
63.622

Rates may not be current.