Digital challenges require international cooperation – OECD ministers

30 Oct 20

Governments must work together if they are to meet the challenges caused by digitalisation and ensure a strong economic recovery after Covid-19, a collection of OECD country ministers have said after meeting to discuss their crisis responses.

 

Lockdown restrictions have changed people’s behaviour around the world since the outbreak of the virus, and digital technology has become much more important for consumers and government activity.

Digital businesses have benefitted from physical shops and offices being closed, while government services have been forced online when face-to-face meetings have been impossible.

This poses challenges for governments on several fronts, including ensuring equitable access to the internet for their citizens, how taxes on digital businesses should be collected and what support needs to be given to businesses that are not online, the country ministers said.

“The Covid-19-induced economic shock has accelerated the digital transition,” they explained in a statement.

“We commit to working together to harness the transformative potential of the digital economy… and to addressing its challenges, including data protection and privacy, digital security, disinformation and the digital divides.

“We believe that enhancing international cooperation in science and technology will be critical for a faster recovery.”

This cooperation will include sharing good practices via the OECD and sending aid to developing countries to address digital issues.

The ministers made specific mention of the ongoing process to reform global taxation of big digital businesses, which recently acknowledged it will miss its end-of-2020 deadline for publishing proposals.

Talks were delayed this year by Covid-19, and challenges still remain in reaching an agreement.

Last summer, the US – where many of the largest digital companies are from – dropped out of talks altogether, citing the lack of progress as its main issue.

Many developing countries view revenue from digital taxes as important for their recovery from Covid-19.

Countries currently face the twin health and economic crises caused by the virus until vaccines and treatments are globally available, while simultaneously trying to lay the foundations for the recovery from the global recession caused by the pandemic.

“Our priorities are to restart hard-hit economies, support jobs, promote clean technology development and sustainable, quality infrastructure while increasing new opportunities for those adversely affected by [Covid-19],” the ministers said.

They added that governments should continue fiscal and monetary stimulus, tailored to their country’s circumstances, while also paying careful attention to the sustainability of the debt they take on.

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