Rise of Internet Economies Prompts Policy Rethink
The stream of innovative, internet-based services that are revolutionizing business models and people’s lives are giving impetus to a modernization of economic policy in the Asia-Pacific. It is urgently needed to address governance gaps and support their development as drivers of new growth that creates opportunities for all.
Telecommunications and information officials from the 21 APEC member economies laid the groundwork for action during policy discussions with private sector representatives, which took place in the Peruvian commercial hub of Tacna.
The focus is on seeding regulation and infrastructure compatible with breakthroughs ranging from the rapid expansion of ride and room-sharing services like Uber and Airbnb, to the impending arrival of driverless cars into consumer markets.
“Services innovations coming to market via the internet and surging in popularity are exposing gaps in preparedness for them,” said Andrey Mukhanov, Chair of the APEC Telecommunications and Information Working Group, which administers regional initiatives to facilitate industry development. “Existing policy regimes should be developed in cooperation with the business sector to address the needs of society for further growth of the internet, electronic and digital economy.”
“APEC and online services providers are working out the regulatory and structural needs of the industry,” explained Mukhanov. “Our objective is to establish enabling conditions for platforms that power entrepreneurship and growth while addressing public health, safety and privacy considerations associated with this progress.”
Particular attention is being directed towards sectors that are at the forefront of innovation in the online space such as education, financial services, healthcare and transportation. It contributes to implementation of the APEC Services Cooperation Framework and Boracay Action Agenda to Globalize Micro, Small and Medium Enterprises endorsed by APEC Leaders in 2015.
“Disruptive innovation is opening up a host of new policy challenges,” noted Wang Yue of China’s Ministry of Industry and Information Technology, overseer of project work in APEC to address them. “When it comes to sharing portals, for example, ownership, licensing and liability are potential grey areas that may require a reexamination of industry regulation.”
“APEC is leading regional efforts to build the technical bandwidth of governments and business to keep up with changing industry requirements,” Wang continued. “Understanding what the complexities are and exchanging lessons on how to tackle them is an important first step towards reducing digital divides between and within the region’s economies.”
Additional attention is on the impact of internet-based services on conventional business practices and mitigating unintended economic and social consequences through measures such as improvements in regulation and supervision, resource allocation and safety nets.
“The rise of internet economies will continue to challenge traditional business models, labor requirements and revenue streams,” concluded Volker Heistermann, Managing Director of Yushan Ventures. “Collaboration in APEC is helping to guide policy adaptation to optimize economic opportunities in the digital era while insulating against growing pains.”
Trade and industry officials will flesh out complementary policy solutions during a cluster of technical APEC fora meetings in Lima, Peru from 15-28 August.
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