April 25, 2016, Ho Chi Minh City, Viet Nam As recognized in the Boracay Action Agenda and the Digital Economy Action Plan in 2015, digital technologies underpin the global economy, acting as a cost-effective platform and catalyst for innovation, supporting new business models, and expanding trade opportunities for micro, small, and medium-sized enterprises (MSMEs). The digital economy offers enormous opportunities to integrate companies into global supply and value chains, enabling MSMEs to enter new markets and fostering more inclusive and sustainable economic growth. The digital economy also provides a cost effective approach to establishing a global presence, thereby expanding the potential customer base for businesses. MSMEs stand to gain the most by accessing the digital economy.
However, MSMEs face difficulties advancing their operations through the digital economy. Access to the digital economy remains challenging for businesses in many APEC economies due to difficulties in accessing the internet and broadband, security and privacy concerns, basic knowledge on developing an online presence, and the high cost of information and communication technology (ICT) equipment and devices. These challenges disproportionally affect MSMEs in comparison to larger companies.
MSMEs comprise over 97 percent of all enterprises and over half of the workforce in APEC economies. A MSME sector well-integrated into the digital economy would be well-positioned to drive economic growth, job creation, and human development in the APEC region. Enhancing digital economy access for MSMEs and reducing barriers to using the Internet for tradeis critical to advancing APEC’s goal to support sustainable economic growth and prosperity in the Asia-Pacific region.
As a result of the workshop, participants have identified the following challenges and potential solutions to help MSMEs actualize the full benefits of the digital and interneteconomy. The SMEWG recognizes that many of the identified challenges and potential solutions may not be addressed in this forum, but believe that the value of this outcome document can potential new areas of work and reinforce the importance of APEC’s existing efforts to more fully utilize the digital and internet economy.
The participants of the workshop included representatives from APEC member economies, private sector including MSMEs, and other non-governmental organizations. The below best practice recommendations are a collective result of the discussions of the workshop that aim to address the issues which most affect MSME access, as well as competitiveness, in the digital economy. These best practices will be shared with the relevant working groups for their comment and attention, including the APEC Policy Support Unit for reference in a 2016 study on issues related to digital trade.
Best Practice Recommendations for Enabling MSME Access to the Digital Economy
In order to enable MSME access to the digital economy, APEC economies should endeavour to:
· Adopt policies and strategies that improve connectivity for MSMEs. These policies should enable the free flow of data across borders, and open and competitive market places;
· Avoid the development of policies that require the localization of data;
· Implement policies that improve MSME access to finance, including traditional finance from banks, angel investors and venture capital funds, and remove regulatory impediments to innovative non-bank financing solutions such as crowdfunding;
· Accelerate the ratification and implementation of the WTO Trade Facilitation Agreement, and modernize customs and logistics proceduresincluding:
o Simplify clearance of low-value shipments, including a commercially relevant de minimis in line with the APEC de minimis Pathfinder,
o Facilitate cross-border e-commerce returns, and
o Establish electronic, pre-arrival clearance of goods;
· Facilitate the adoption of e-payment solutions that are secure and reliable;
· Consult on a regular basis with the private sector, especially MSMEs, on the development and implementation of policies related to the digital economy;
· Make access to the internet more available and affordable by prioritizing the importance of investment in ICT-related infrastructure, as well as enhance public-private cooperation to accelerate the improvement of universal ICT infrastructure;
· Share best practices with the goal to create regulatory coherence among APEC economies, particular in the areas of international data transfer standards;
· Expand and promote APEC efforts to share information to facilitate MSME business into global markets;
· Foster digital literacy, enable and promote the development of locally relevant content, applications, and services to ensure social and economic value of the digital economy to consumers and businesses across the region;
· Facilitate policies that increase the participation of women-owned MSMEs in the digital economy;
· Encourage collaboration among large private sector companies on assisting MSME access to the digital economy;
· Promote the development of policies that ensure consumer protection 6 May 2016and trust, including the implementation of Cross Border Privacy Rules as well as the APEC Privacy Recognition for Processors System; and
· Encourage APEC economies to include the participation of key technology leaders in APEC dialogues.