7th CUTS-CIRC Biennial Conference on Competition, Regulation and Development
DAY 2 - Wednesday, November 17, 2021

The session highlighted the progressive rise of e-commerce after the onset of the COVID-19 pandemic and deliberated on the inherent challenges faced in the utilisation of the differential digital growth in emerging as well as developed countries in the post pandemic economic recovery stage.

Since the panel was representative of countries at different developmental stages, a range of unique challenges were identified. While some countries cited basic infrastructural concerns, some mentioned inclusion and onboarding of e-consumers as a challenge. In other cases, more technological challenges such as data privacy and cross border data flows were identified.
Session Highlights 
At the outset, the session identified the domino effect which, spurred by digitalisation has been instrumental in translating to an increase in mobile users, broadband subscribers, internet bandwidth, growth of data centres and forms a never-ending chain. The discussions noted that the difference between e-commerce and the broader concept of digital trade shall slowly become blurred.

Panellists opined that there are sufficient laws to govern an e-commerce ecosystem, including cyber security, consumer protection and the like and the need to have a next step of a new global institutional framework inculcating a multilateral and multi stakeholder involvement, must be deliberated upon since e-commerce is still viewed largely as a national matter. However, a few panellists highlighted that consumers may not be able to drive changes without the assistance of regulation. Especially in light of the fact that companies do not compete on vital consumer facing issues such as privacy. A need for competition law, policy and regulation to play a more proactive role in hand holding and protecting consumers, was identified.

The discussions also revolved around competitiveness in the e-commerce space. It was pointed out that the cost of compliance decreases with an increase in the size of the company. Thereby, the smaller players of the market invariably bear the brunt of the regulation and find it difficult to enter an already concentrated market. This underscored the need for an agile competition regime even further.

It was discussed that from a regulatory perspective, the approach must be to selectively regulate in a nuanced manner. The regulatory design must deliberate upon ensuring the creation of a level playing field, assessing market power (particularly since these platforms are multi-sided) and lastly determining the time and manner of regulation. 

During the course of the discussion, it was identified that in developing countries in Africa, there has been a lack of basic physical infrastructural amenities. With COVID-19 and e-commerce, an opportunity for inclusive growth and innovative opportunities was witnessed. Earlier products within the country were not accessible but now there has been a growth in the opportunity to access products across the continent. More investment and international community support could greatly support countries in early stages of digital readiness.
The session highlighted that e-commerce has created a large number of opportunities both economic and social, across the globe in the post pandemic era. Since e-commerce has the potential to increase the outreach by firms and thereby increase international trade, it is important for emerging as well as developing economies to promote an inclusive digitalisation in order to benefit all the sectors. Certain common issues were identified during the session such as control and flow of data. In the e-commerce space, developed and developing countries each have their unique set of challenges depending on the development stage of the country.
Way Forward
In order to facilitate quick flow of trade, it is important for developing countries like India to enter into bilateral agreements and be part of multilateral collaborations. Organisations like CUTS play an important role as a player to reckon with in the overall policy discourse. Therefore, in order to shape an inclusive global economy, the government should work with e-commerce players as well as offline traders. Considering the differing development stages of each country, multilateral solutions coupled with targeted local solutions should be the way forward.

  • Jay Gullish, Senior Director, Digital Policy, US-India Business Council (USIBC)
  • Torbjörn Fredriksson, Head of the E-Commerce and Digital Branch, United Nations Conference on Trade and Development (UNCTAD)
  • Thibault Schrepel, Faculty Affiliate, Stanford University’s CodeX Center
  • Chetan Krishnaswamy, Vice President, Public Policy India, Amazon
  • Katharine Kemp, Senior Lecturer, Faculty of Law & Justice, UNSW Sydney
  • Peter Mwencha, Assistant Professor, American International University, Kuwait
  • Vedika Mittal, Senior Research Fellow, Vidhi Centre for Legal Policy
  • Raymond Tavares, UNIDO Representative in Cameroon and Central African Countries
  • Moderated by Mia Mikic Advisor at Large, ARTNeT

The session highlighted the fact that hundreds of millions of people have lost their jobs and income opportunities due to the pandemic, and even more are predicted to be pushed into poverty. Thus, COVID-19 has led to deepening inequality and threatening not only the achievement of Sustainable Development Goals (SDGs), but also possible law and order problems in many parts of the world. The session discussed the emerging global strategies to deal with such scenario. Further, it noted that growing digitalisation of economies is affecting the job market. It also endeavoured to understand what role can competition policies play in the enhancement of income opportunities.
Session Highlights
The global employment scenario is fragile and the global economic recovery is uneven. Further, the pandemic has harbingered an unprecedented disruption in the labour market. Inequality is rising as evidenced by rising poverty. The rising incidence of poverty coupled with rising corporate profits and billionaire incomes indicates that there is a serious inequality problem, which is happening in India as well as in the global economy. According to the World Bank, the pandemic has pushed 97 million people to poverty in 2020.

Further, the discussion steered towards how most countries have suffered a steep deterioration in employment and national income which increased inequality in terms of workers. Micro, Small and Medium Enterprises (MSMEs), especially women-led ones, were adversely impacted, enhancing unevenness and uncertainty everywhere. India itself saw around 12-15 million people pushed into poverty. Many such MSMEs are on the verge of extinction. The panellists pointed that India along with other global economies is adopting protectionist measures to regulate its job crisis. The panel discussed the role of International Labour Organisation (ILO) and its focus on human-centric recovery, along with realising the challenges that come with work from home.

As the panellists pointed out, there are several themes to inequality. Looking into the job sector through the lens of global inequality in light of COVID-19, the panellists pointed towards three most affected stakeholders in the employment sector as:

  • Less educated workers who are on low paying jobs which constitute the informal sector,
  • Jobs of women, as they have juggled through work responsibilities and household duties, many of them have dropped out of employment due to imbalance in responsibilities with their male counterparts, and
  • The youth who became eligible to enter the job market during the worldwide lockdown.
It was observed by the panel that in order to ensure transparency and fairness, competition regimes need to show more commitment and come out with relevant guidelines as well as conduct more market studies. Further, the focus should be on the industrial policies, for creating good and better jobs, with a better working environment than just focusing on creation of jobs.

COVID-19 has increased digitalisation in the economy. This divide as pointed out by the panellists needs to be addressed both at national and global level. This form of digital slavery needs to be put to an end. Migration could be one of the ways to resolve the issues created by the global pandemic. The need of the hour is to start thinking about international organisations on migration and related policies. ILO could play an important role in this. It was further pointed out that knowledge is an essential facility.
The notion along with the method of skill transfer has changed through time. The pace of things are changing and a wide variety of skills need to be acquired. Increase in inequality and pandemic leading to job losses is a wakeup call for global action. There is a need for better understanding of the job market and stakeholders who have suffered the most. Free moment of human capital is fundamental for economic growth and equity
Way Forward
The old globally accepted economic model of neoliberalism has failed as it has resulted in growing inequality. Further, the COVID-19 pandemic has only shown how inequality grows during times of economic downturns. Therefore, there is a growing need of focusing on human centric development. The need of the hour as pointed out by the panellists is to disseminate active labour market policies, along with the call for social protection. The idea is to have gender neutral policies and a more global call for action. The economies should learn from the 2008 financial crisis, further reaching out to the investor community that eventually holds the power in policy making. There is a need to equip people with skills that help them acquire a lost job. Panellists pointed out that there should be measures to re-orient the growth strategy along with formation of measures to assist MSMEs in the informal sector. The focus should be on reducing the increased wage disparity among people. Panellists pointed towards the need for an open global Product, Investment, Service and Human Capital markets.
  • Kelvin Sergeant, Sustainable Enterprise Development Specialist, DWT, South Asia and Country Office, India, International Labour Organization
  • Phil Evans, Independent Consultant and former Inquiry Chair at Competition and Markets Authority, UK
  • Radhicka Kapoor, Senior Visiting Fellow, Indian Council for Research on International Economic Relations (ICRIER)
  • Sumit Majumdar, Professor, Technology Strategy, The University of Texas at Dallas
  • Samar Verma, Program Officer, The Ford Foundation
  • Moderated by Pradeep S Mehta, Secretary General, CUTS International

The valedictory session focused on the need for increased international cooperation in the face of emerging global challenges. The discussions examined the fragmentation of international governance and its associated risks and consequences. The threats of a fragmented system, including differing standards, unilateral responses to issues of global commons, and a backlash against globalisation were discussed. The discussions highlighted that working towards achieving the Sustainable Development Goals 2030 would be instrumental in heralding an inclusive and resilient economy. 
Session Highlights
At the outset, the discussion noted that rising income inequality had been accompanied by inequities in accessing developmental services such as health and education. The panellists observed that the world had undergone profound changes, driven by a growing digital economy and its associated implications, which had been accelerated by the pandemic. 
The panellists noted that there was a visible lack of trust in competitive markets after multiple crises. Markets were structurally incapable of quick adjustments in the face of abrupt, external shocks, the costs of which are borne by societies. However, a lot of the adverse effects could be mitigated through a synergy of policy and laws on competition, industry and trade. There should be an equal emphasis on achieving national strategic needs, while at the same time maintaining adequate levels of competition and innovation. Cooperation on good regulatory practices can play an important role towards such ends. 
The discussions recognised that the benefits accruing from capitalism and open markets must be equitable and broad-based. The panellists discussed various ways this could be achieved, including the establishment of minimum desirable outcomes in each area. Any inclusive and resilient post-pandemic economic recovery must put MSMEs at its centre. Issues of access to finance, and access to digital platforms on fair terms and conditions need to be addressed.
It was observed that a focus on short term profit maximisation, combined with international trade, has made us excessively dependent on fragile supply chains. The need for innovative thinking, such as promoting cooperation between competitors in certain cases, and making economies more flexible and adaptable in the face of economic shocks, was a key focus of the discussions.
The inability to mobilise resources forces developing countries to resort to myopic policies over long-term, sustainable solutions. The session highlighted the lack of any clear, existing roadmaps towards a more resilient and inclusive economy today. There was a sense that the historically hard-won global frameworks, such as the multilateral trade, competition and consumer protection frameworks need to be reinvigorated. 
It was pointed out that international diplomacy needs to be complemented by a multi-stakeholder approach, bringing on board civil society, academia and businesses. The discussions recognised the presence of significant gaps between aspirations and realities in vaccination coverage, development, digital access, environmental protection, and ideology.  
Way Forward
The conventional instruments of trade policy, consumer protection and competition policy, in tandem with the existing architecture of international cooperation, can provide a way forward. A strategy of rebuilding and reform may be preferable over restarting afresh.
The political and governance deficits in the existing international arena must be overcome through greater cooperation rather than competition.  

  • Frederic Jenny, Chairman, Organisation for Economic Co-operation and Development (OECD) Competition Law and Policy Committee
  • Pascal Lamy, Former Director General, World Trade Organisation (WTO)
  • Teresa Moreira, Head, Competition and Consumer Policies Branch, United Nations Conference on Trade and Development (UNCTAD)
  • Ioannis Lianos, President, Hellenic Competition Commission
  • Simon J Evenett, Professor, University of St. Gallen, Switzerland
  • Allan Asher, Chair and Managing Consultant, Foundation for Effective Markets & Governance (FEMAG), Australia 
  • Moderated by Arvind Mayaram, Former Finance Secretary of India and Chairman, CUTS Institute for Regulation & Competition (CIRC)
We will be grateful if you could re-circulate.
Please send us your feedback at dks@cuts.org and aks@cuts.org

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