Deputy USTR Says TPP Would Secure Digital Openness in Vulnerable Regions

Congress should work quickly to ratify the Trans-Pacific Partnership, as an expanding patchwork of data localization rules in Asia threatens to stunt U.S. digital entrepreneurship, weaken U.S. dominance in services exporting, and barricade Eastern economies from adopting open internet standards, said Deputy U.S. Trade Representative Robert Holleyman Friday. Governments including China, India, Indonesia, Russia, South Korea and Turkey either maintain or are working to pass commercially inhibiting data localization rules, Holleyman said at the American Enterprise Institute.

Between 2010 and 2020, the number of connected devices worldwide is estimated to grow from 12.5 billion to 50 billion, and the 12 TPP parties generate about 40 percent of global internet traffic, Holleyman said. “That gives this agreement the weight, the heft to shape a global future, to bend the policy of countries away from digital protectionism towards a future of openness, innovation, and if you’d like, of comparative advantage.” While the U.S. exports more services than the second and third runners-up combined, the U.S. can maintain this comparative trade advantage only if innovators can access foreign markets where 95 percent of global consumers and businesses reside, Holleyman said.

Holleyman expressed concern about pundits’ predictions that TPP might not get ratified for “years, or in the next decade,” saying for innovators “even a year’s delay can mean a lifetime. If we lack the political will to ratify TPP soon, our ambition will yield few material benefits for our innovators. Indeed, it has the potential to allow a series of setbacks to be put in place barrier by barrier by barrier by barrier, that will make it tougher and tougher and tougher for the innovation we've seen, for the entrepreneurship that we've seen, to grow.”