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Digital Trade

The Architect of Europe’s Digital Single Market Leaves Important Questions Unanswered on U.S. Visit

At a time of considerable uncertainty about the future of transatlantic digital commerce, one Europe’s top officials for such issues, Gϋnther Oettinger, visited the United States last week and did little to dispel concerns that the EU’s Digital Single Market (DSM) may raise new barriers for U.S. companies. Of particular concern for many in the United States is vague language in the DSM that appears to be designed for protectionist purposes. As one of the strategy’s chief architects, Oettinger would have been uniquely well-positioned to offer needed clarification. He didn’t.

The growing list of political, legal, and regulatory cases involving top American technology companies prompted U.S. President Barack Obama earlier this year to call out Europe for protecting domestic competitors. More generally, it has raised serious concerns about the direction that Europe’s regulatory environment is heading as it proceeds through multiple policy initiatives in parallel—the Digital Single Market, the General Data Protection Review, a revision of the U.S.-Europe Safe Harbor Framework, and the Trans-Atlantic Trade and Investment Partnership. Any one of these on its own would be a major issue for the transatlantic trade relationship, but taken together, they

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New Government Report Confirms Benefits of Digital Trade

The digital economy has been a major boon to U.S. domestic and international trade, as is documented by a new report by the United States International Trade Commission entitled Digital Trade in the U.S. and Global Economies (summary here). And even though the report shows important benefits from digital trade, those benefits are likely understated. This is because the report limited its analysis to “digitally intensive” sectors, which means that its numbers exclude contributions from firms that only use digital trade as a smaller part of their business.

Still, digital trade has made quite an impact: the report estimates that digital trade has raised real U.S. GDP by $517.1-$710.7 billion (3.4−4.8 percent) by increasing productivity and lowering the costs of trade. By raising GDP, digital trade increased average wages, and the increased wages likely contributed to increased employment by as much as 2.4 million jobs.

Within digitally intensive industries (and likely within many non-digitally intensive industries, although the report focused on the former), the internet has come to play a major role in everyday commerce. Firms in these industries sell nearly a trillion dollars’ worth of goods and services

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