The UK and Singapore have launched negotiations on a Digital Economy Agreement (DEA) to encourage digital trade between the two countries.
The agreement aims to remove barriers and enable the UK to expand its exports into high-tech markets. By promoting digital technology such as electronic transactions, e-signatures, and e-contracts, the deal would allow companies to trade more efficiently.
In order to bring about these benefits, the deal aims to secure open digital markets for exporters, allowing them to expand into new markets and sell traditional products in new ways. It will also ensure free and trusted cross-border data flows while upholding high standards of personal data protection.
The deal will promote digital trading systems, such as digital customs and border procedures that will save time and money when exporting.
In addition, the DEA aims to uphold consumer rights and protect businesses’ valuable intellectual property like source code and cryptography. It will deepen the UK’s cooperation on future growth sectors like fintech and lawtech, while working with Singapore to strengthen collective cybersecurity capabilities.
The initial meeting was conducted by UK International Trade Secretary Liz Truss and Singapore’s Minister in charge of Trade Relations, S. Iswaran.
Truss said: “A cutting-edge deal with Singapore will keep us at the forefront of the technological revolution, ensuring we lead the way in digitally delivered trade and industries like fintech and cybersecurity.
“We are already the second-largest services exporter in the world, with a huge comparative advantage in this area that we intend to capitalise on.
“The UK will be the first European country to ever negotiate a Digital Economy Agreement, which shows what we can do as a sovereign trading nation. We are becoming more flexible, more nimble and less defensive in our approach to trade.
“Our ambition is to make the UK a global hub for services and digital trade, by striking a series of advanced, high-standards agreements with leading nations across the world that drive productivity, jobs, and growth across the UK.”
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Singapore has a well-developed tech sector. In 2019, the country exported nearly $151 billion of high-tech products, such as computers and pharmaceuticals. This ranks it seventh in the world, ahead of the UK at 13th, which exported $78 billion.
Furthermore, the government of Singapore has been taking steps to develop its tech industry and attract global players.
Major tech companies, including Google, Facebook, and Amazon, all have significant regional presence in Singapore. Furthermore, Chinese companies like Tencent and ByteDance have moved their operations to Singapore to avoid the Chinese-American trade war.
According to the UK Government, 70% of the UK’s services exports, which includes financial and legal services, were digitally delivered to Singapore in 2019, worth around £3.2 billion.
Recently, the European Union signed a data adequacy deal with the UK, recognising that the country’s data protection legislation afforded sufficient data protection to store and process EU citizen’s data.
The deal will help ensure unimpeded data flows between the UK and EU – without a deal, the cost to British businesses was estimated to around £1.6 billion.
However, the EU warned that the decision could be reversed if the European Commission believes UK regulations are no longer fit to protect EU citizens’ data. As such, any potential UK Singapore Digital Trade Agreement will need to respect GDPR provisions, or it could jeopardise the adequacy decision.