(Bloomberg) —<\/p>\n
Tucked into President Donald Trump\u2019s trade deals formalizing higher tariffs on goods from Asia this week are provisions for a global economic frontier the US wants to stay free of protectionism: digital commerce.<\/p>\n
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In deals with Malaysia and Cambodia, and a more preliminary agreement with Thailand, the White House received assurances none will impose digital services taxes or discriminate against American providers of e-commerce, social media, streaming, cloud storage or other types of online services. Those activities count as digital trade when the transactions cross national borders.<\/p>\n
While Trump wields tariffs to rebalance US deficits in merchandise trade, his push for a global internet free of import duties and other surcharges is aimed at ensuring the world\u2019s largest economy remains the leading net exporter of e-services. That stands in contrast with the prior administration under Joe Biden, which was more sympathetic to European officials\u2019 concerns about unfettered access to markets for US tech giants including Alphabet Inc.\u2019s Google, Meta Platforms Inc. and Amazon.com Inc.<\/p>\n
\u201cThe Trump administration believes that our deficit in trade in goods has been unfairly imposed, but that our surplus in trade in services has been fairly earned\u201d and wants to \u201cmaintain our services surplus, while reducing our goods deficit,\u201d said Anupam Chander, a professor of law and technology at Georgetown Law in Washington. \u201cI could understand why other countries would feel that this is itself unfair.\u201d<\/p>\n
Last year, global exports of digitally delivered services increased to more than $4.77 trillion, a nearly 10% jump from 2023 and more than double the growth in total goods and services trade, according to World Trade Organization and United Nations figures. It\u2019s the fastest-growing segment of global goods and services trade that reached about $33 trillion last year.<\/p>\n
<\/p>\n
Supercharging digital trade is artificial intelligence, raising questions for officials concerned about national security, data sovereignty, intellectual property abuse and consumer privacy protections as online services flow unchecked across borders.<\/p>\n
For some nations, it means a loss of government revenue as items formerly shipped as goods \u2013 a book or a movie, for example \u2013 are now sent digitally and out of reach of traditional customs duties.<\/p>\n
Story Continues <\/p>\n
As Trump tries to rewire the global trading system, digital commerce has become another battleground for geopolitical fragmentation where Washington and Beijing are jockeying for influence across Africa, Latin America and South Asia.<\/p>\n
The new US provisions for Malaysia, Cambodia and Thailand stand out because they call for long-term acceptance of an agreement forged at the WTO calling on all countries to refrain from putting tariffs on digital services.<\/p>\n
All three Southeast Asian economies agreed to support a permanent extension of the WTO accord known as the \u201cmoratorium on customs duties on electronic transmissions.\u201d<\/p>\n
Aside from that initiative and another aimed at protecting fisheries, Washington has abandoned the WTO \u2013 the referee of the rules-based trading system for the past 30 years – in favor of Trump\u2019s unilateral approach with so-called reciprocal tariffs.<\/p>\n
Global Agreement<\/p>\n
The WTO moratorium has been extended by consensus every two years since 1998, most recently in 2024 when it only was approved in a last-minute deal held up by objections from India. It comes up for renewal again heading into the Geneva-based organization\u2019s ministerial meeting in March 2026 in Cameroon.<\/p>\n
\u201cThe commitments in the US deals to facilitate the free flow of data are absolutely welcome \u2013 especially when set against the trend for localization requirements that we\u2019ve seen in recent years,\u201d said Andrew Wilson, deputy secretary-general for policy at the International Chamber of Commerce. \u201cWhile country-by-country progress is valuable, the ultimate goal should be to anchor these norms in a new international deal.\u201d<\/p>\n
Malaysia\u2019s accord with Trump included the additional concession that it will refrain from \u201crequiring US social media platforms and cloud service providers to pay into Malaysia\u2019s domestic fund.\u201d<\/p>\n
The latest digital pacts by the US \u2013 plus a preliminary one with Vietnam that contains a vague pledge to finalize digital services commitments \u2014 follow a framework the US announced in July with Indonesia, whose customs agency had preemptively added a line for digital services in its harmonized tariff schedule, or HTS.<\/p>\n
That deal specified that \u201cIndonesia has committed to eliminate existing HTS tariff lines on \u2018intangible products\u2019 and suspend related requirements on import declarations,\u201d according to the White House document.<\/p>\n
Under Trump, the US push for a permanent extension will have to address concerns from Brazil and India, both of which have faced some of the steepest US tariffs. In the past, both have wanted to preserve the option of raising revenue from foreign tech companies and protecting domestic e-commerce companies. Keeping the moratorium renewable also gave them leverage in other areas of trade.<\/p>\n
\u201cThat extension looked very shaky after the last ministerial conference,\u201d said Simon Evenett, a professor of geopolitics and strategy at IMD Business School in St. Gallen, Switzerland.<\/p>\n
US Big Tech<\/p>\n
Still, he said, while the US uses its leverage to push for a permanent extension of the moratorium, \u201cit\u2019s too soon to say this represents broad-based WTO re-engagement \u2014 more likely, it\u2019s selective engagement on a topic critical to US big tech.\u201d<\/p>\n
Digital services provisions are part of most modern trade agreements, though the US and European Union have different views on the need for openness.<\/p>\n
Officials in Brussels want safeguards against anti-competitive behavior and stricter data privacy protections \u2014 oversight that US officials consider over-regulation. Some European countries have annoyed Washington by imposing taxes on digital services, viewing such moves as domestic fiscal policy that\u2019s outside the scope of trade talks. French lawmakers earlier this week voted to double a tax on large technology companies, risking a backlash from Trump.<\/p>\n
The US-EU trade framework dated Aug. 21 noted both sides \u201ccommit to address unjustified digital trade barriers\u201d and will together pursue a permanent WTO\u2019s e-commerce moratorium.<\/p>\n
Martina Ferracane, an associate professor of international digital trade at Teesside University in the UK, said another temporary extension is likelier than a permanent one because the US administration has \u201cweakened its credibility\u201d to lead a global consensus on the issue.<\/p>\n
She cited Trump\u2019s pledge to put 100% tariffs on films made outside the US as an example of a \u201cthreat of non-compliance\u201d with the international ban on tariffs on digital commerce.<\/p>\n
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\u00a92025 Bloomberg L.P.<\/p>\n","protected":false},"excerpt":{"rendered":"(Bloomberg) — Tucked into President Donald Trump\u2019s trade deals formalizing higher tariffs on goods from Asia this week…\n","protected":false},"author":2,"featured_media":539690,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3090],"tags":[51,174005,73962,174006,134600,32,1700,1055,30042,16,15],"class_list":{"0":"post-539689","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-digital-commerce","10":"tag-digital-services","11":"tag-digital-services-taxes","12":"tag-digital-trade","13":"tag-donald-trump","14":"tag-economy","15":"tag-malaysia","16":"tag-the-white-house","17":"tag-uk","18":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115468511758646043","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/539689","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=539689"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/539689\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/539690"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=539689"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=539689"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=539689"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}