The digital economy is sometimes characterized narrowly as online platforms and activities that owe their existence to such platforms, however, in a broader definition, all activities that utilize digitized data constitutes part of the digital economy. Depending on the definition of “digital economy,” current estimates of the size of the digital economy range from 4.5 percent to 15.5 percent of global GDP. Over the next decade, it is estimated that approximately 70 percent of new value created in the economy will be based on digitally enabled platforms.
In 2017, APEC Leaders pledged to work together to realize the potential of the internet and digital economy and welcomed the adoption of the APEC Internet and Digital Economy Roadmap (AIDER). The Roadmap is a framework that provides guidance on key areas and actions to facilitate technological and policy exchanges among member economies and to promote innovative, inclusive and sustainable growth, as well as to bridge the digital divide in the APEC region. It lays out eleven key focus areas of work:
- Development of digital infrastructure
- Promotion of interoperability
- Achievement of universal broadband access
- Development of holistic government policy frameworks for the internet and digital economy
- Promoting coherence and cooperation of regulatory approaches affecting the internet and digital economy
- Promoting innovation and adoption of enabling technologies and services
- Enhancing trust and security in the use of information and communication technologies (ICTs)
- Facilitating the free flow of information and data for the development of the internet and digital economy, while respecting applicable domestic laws and regulations
- Improvement of baseline internet and digital economy measurements
- Enhancing inclusiveness of internet and digital economy
- Facilitation of e-commerce and advancing cooperation on digital trade
In 2018, the creation of the Digital Economy Steering Group (DESG) was agreed upon at the Concluding Senior Officials Meeting (CSOM) in Port Moresby. The DESG aims to facilitate the development of the internet and digital economy, including e-commerce and digital trade. As the inheritor of the deliverables of the Ad Hoc Steering Group on the Internet Economy, the DESG advises senior officials on a comprehensive and regular basis on implementation of the Roadmap, giving full recognition to the Roadmap’s broad scope. In addition, the DESG preserves the functions of the former Electronic Commerce Steering Group (ECSG) and continues to report to the Committee on Trade and Investment (CTI) on matters of the ECSG’s work program on e-commerce and trade-related digital economy issues.
The next DESG meeting will take place in August 2023 on the Third APEC Senior Officials’ Meeting (SOM 3) in Seattle, Washington, USA.
Last page update: June 2023
DESG Work Program for the Implementation of the AIDER
In November 2020, DESG members adopted the Work Program for the Implementation of the APEC Internet and Digital Economy Roadmap (AIDER). The work program translates the 11 key focus areas (KFA) of the AIDER into more specific priority areas. Relevant APEC fora and sub-fora will report initiatives or projects that would address the priority areas and, when completed, will achieve the attainment of the relevant KFA. This work program will guide DESG’s work implementing the AIDER from 2020 to 2025.
The latest DESG Report on the Implementation of AIDER summarizes the progress APEC has made in 2021-2022, consolidates information about completed and ongoing initiatives that contribute to each of the 11 KFAs, and identifies areas that require more effort from member economies.
Digital Permitting & E-Government
Recent work within the DESG helped shine a light on a key element for the digital government agenda through APEC report, Policy Recommendations: Digital Permitting and E-Government Measures to Advance the Post-COVID-19 Economic Recovery, published in April 2022. The report provides APEC economies with actionable suggestions to implement best practices on promoting digitalization of licensing and permitting (L&P) processes – a critical piece of an economy’s investment and “doing business” environment. As a guide, it includes policy recommendations as well as case studies from APEC economies at various stages of development, providing different perspectives from municipalities and domestic governments that are implementing digital L&P initiatives.
DESG continues this initiative in 2023 with a follow-up project, Catalyzing Stakeholders for Effective Implementation of Digital L&P. This project builds on earlier work by engaging public and private sector stakeholders to build capacity and create champions within APEC economies for digital L&P, who can amplify its benefits among relevant constituents and may be in a position to initiate a domestic initiative. The project workshop is scheduled at the sidelines of SOM 3 in the US.
Biometric ID Management
The COVID-19 crisis has reinforced the need of a frictionless and interoperable identity management aimed at facilitating cross-border air travel while minimizing disease-spreading physical touchpoints and smoothening passenger journey. The recent DESG project, Achieving Harmonization of a Biometric ID Management Framework across APEC Economies, implemented in cooperation with International Air Transport Association (IATA), aims to assess the current level of Biometric ID awareness, understanding, and maturity among APEC economies, learn from non-APEC implementations by conducting global benchmarks, and provide practical recommendations on Biometric ID adoption for harmonization across all APEC economies.
The global benchmarking study, published as part of this project in March 2023, provides introduction to biometrics and its adoption in air transport around the world and among APEC economies; key drivers of adopting biometric identity in APEC economies; regional biometric maturity assessment among APEC economies; biometric identification management applications in aviation; and challenges and issues faced and the proposed solutions. Building on the outcomes of the study, the practical guidebook, published in May 2023, is designed as a reference for APEC economies planning, implementing, or expanding the use of biometric identification solutions in cross-border travel. The guidebook sets a recommended end-state vision and includes implementation stages and key success factors for consideration.
Data Privacy Subgroup (DPS)
The APEC Data Privacy Pathfinder was established by ministers in 2007 to achieve accountable cross-border flow of personal information within the APEC region. This goal is to be achieved by developing and implementing the Cross-Border Privacy Rules (CBPR) system, consistent with the APEC Privacy Framework, which was first endorsed by APEC ministers in 2004, and then revised and updated in 2015. The updated APEC Privacy Framework 2015 addresses the gaps in policy and regulatory frameworks on e-commerce to ensure that the free flow of information and data across borders is balanced with the effective protection of personal information essential to trust and confidence in the online marketplace. The update of the privacy framework was endorsed by ministers in November 2016.
Progress on the implementation of the APEC Privacy Framework includes the application of Information Privacy Individual Action Plans (IAPs) by 13 economies, and the creation of a study group within the Data Privacy Sub-Group (DPS) to analyze and identify best practices and the role of trust-marks in promoting the cross-border flow of information.
Notable progress in this area was made by the establishment of an APEC Cross-Border Privacy Enforcement Arrangement (CPEA) in July 2010. This multilateral arrangement provides the first mechanism in the APEC region for privacy enforcement authorities (PEAs) to share information and provide assistance for cross-border data privacy enforcement. The CPEA signifies the ongoing commitment within APEC to increase the protection of cross-border flows of personal information and is a significant step in the effective implementation of the APEC Privacy Framework.
APEC ministers endorsed the principal documents of the APEC Privacy Pathfinder in November 2011 in Honolulu, Hawaii. APEC Leaders also committed to implementing the CBPR System “to reduce barriers to information flows, enhance consumer privacy, and promote interoperability across regional data privacy regimes.”
APEC Cross-Border Privacy Rules (CBPR) System
In November 2011, the APEC Leaders issued a directive to implement the APEC Cross Border Privacy Rules (CBPR) system. The CBPR system balances the flow of information and data across borders while at the same time providing effective protection for personal information, essential to trust and confidence in the online marketplace. The system is one by which the privacy policies and practices of companies operating in the APEC region are assessed and certified by a third-party verifier (known as an accountability agent) and follows a set of commonly agreed upon rules, based on the APEC Privacy Framework. By applying this commonly agreed-upon baseline set of rules, the CBPR system bridges across domestic differences that may exist among domestic privacy approaches. Currently, nine APEC member economies—Australia, Canada, Japan, Republic of Korea, Mexico, the Philippines, Singapore, Chinese Taipei and the United States—have aligned their privacy laws with the APEC Privacy Framework.
APEC Privacy Recognition for Processors (PRP) System
The Privacy Recognition for Processors System (PRP) governance documents were endorsed by APEC in August 2015. The PRP system is designed to help personal information processors assist controllers in complying with relevant privacy obligations, and helps controllers identify qualified and accountable processors. This is done through an intake questionnaire, which sets the baseline requirements of the PRP. The APEC-recognized accountability agent will then assess a processor seeking recognition based on a set of requirements. Currently, two APEC member economies—Singapore and the United States—have joined the PRP system.