GENEVA The Internet is a wonderful thing, perhaps the greatest liberalizing force since the invention of the printing press. Whether you live in Kalamazoo or in Kuala Lumpur, ordering the latest Madonna CD is only a click away on Amazon.com. People from Shanghai to Santiago can read The New York Times online. And in Yahoo's auctions you can buy pretty much anything from anyone, anywhere. The Internet makes it easier for people to do all sorts of things - including bypassing trade barriers and inefficient bureaucracies. Thus an Internet start-up can more readily reach a global market than a new steel mill. . But even the digital economy can fall victim to red tape and protectionism. Governments, however well-intentioned, can hinder the global development of e-commerce. The success of the Internet has been promoted, to a far greater extent than is generally realized, by the freedom to trade established through negotiations in the World Trade Organization. . Start with your computer. Open up an American PC sold in Europe and you may see memory chips from Japan and South Korea, a microprocessor from Costa Rica, a disk drive from Singapore and a motherboard from Taiwan, all assembled in Ireland. International trade in such computer hardware is duty-free in many countries thanks to the WTO's Information Technology Agreement, signed in 1997. . By 2004 this will have eliminated tariffs on some $600 billion a year in trade in semiconductors, computers, telecoms equipment, integrated circuits and other computer hardware. Without the WTO, your PC would be less affordable. . Another major WTO agreement reached in 1997, on Basic Telecommunications, is bringing down the cost of the telecommunications services on which the whole of the Internet phenomenon depends. Under this agreement 85 countries accounting for more than 90 percent of world telecommunications revenues have agreed to allow foreign companies to operate in their markets, usually by setting up a new operation or buying into an existing one. . The results, especially in formerly monopolized markets, are dramatic. Competition has cut the price of everything from calling your aunt in Australia and surfing the web on your mobile to corporate internets and satellite data transmission. The agreement also commits the participating governments to pro-competitive and nondiscriminatory regulation of their telecoms markets. . Since many services can be delivered in digital form, unlike physical goods, the vast majority of the business conducted over the Internet is the delivery of services, including the distribution services through which you can select, order and pay for physical goods. In the WTO system, and the international legal system as a whole, the only guarantees which exist of any company's right to provide international services on the Internet are the commitments which governments have undertaken in the General Agreement on Trade in Services, the GATS. . Also important is the WTO's intellectual property agreement, the TRIPS agreement, which commits member governments to enact and enforce modern copyright, patent and trademark laws. Because lack of intellectual property protection is a strong disincentive to the export of the latest technology, this encourages foreign investment and the spread of new technologies, not least in the media and IT sectors. . WTO agreements thus already provide the foundations for international business on the Internet. But there is still much more that governments could do to promote electronic trade. . Since GATS commitments are the only guarantee of the right to supply services electronically, success in the current round of negotiations on the liberalization of services trade, which aim to expand the country and sector coverage of GATS commitments and to reduce restrictions on market access across a wide range of sectors, would greatly enhance the security of Internet business. In particular, further commitments in the telecommunications sector would go far to strengthen the backbone of the new economy. . Governments are likely to prioritize those services which can most easily be provided over the Internet, but they should also look to make it easier for foreign service providers to work abroad. That would allow, for instance, American software firms to employ more Indian computer programmers. . A second information technology agreement would enable a wider range of computer hardware, such as circuit boards, to be traded duty-free. . Our last, and perhaps our greatest, challenge is to help bridge the digital divide between rich and poor. The news is not all bad. India's IT industry is mushrooming, and Kenyan tea farmers can now use the Internet to check the futures prices of their crop. But such examples are the exceptions, not the rule. Worldwide, only one in 20 people has access to the Internet. There are more Internet connections in Singapore than in all of Africa. Governments in rich countries urgently need to do more to help bridge the digital divide. Governments in developing countries can help themselves by committing at the WTO to free up their telecoms markets. Most developing countries say they fear marginalization more than globalization. . Some extreme environmentalists attack globalization saying it will wreck the environment. But there are huge environmental pluses in the new economy. One pound of fibre optics shifts as much information as a ton of copper. Efficiency is just another word for conservation. The Internet may turn out to be the greatest unifying force the world has ever seen, making knowledge, the basis of all progress, available to all. But because of the speed with which the electronic revolution is moving in the rich world, it also creates the danger of even greater marginalization of the poor.
One way to counter that is to tear down the barriers which damage developing countries in particular. This is why I think it vital that WTO members launch a new round of negotiations at Qatar in November. If we let slip the opportunities of the Internet age, it will be the poor and weak, as always, who pay the highest price. . The writer is director-general of the World Trade Organization. He contributed this comment to the International Herald Tribune.
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