Global Times – The rise of digital trade, emerging as a pivotal trend in the global trade landscape, has presented new cooperation opportunities for China and the US. This is because the fundamental principle for China-US relations – that is, both stand to gain from cooperation and lose from confrontation – also applies to digital trade.
In recent years, China’s digital trade has experienced remarkable momentum. In the first three quarters of 2024, China’s imports and exports of digitally deliverable services reached 2.13 trillion yuan ($292 billion), up 5.3 percent year-on-year, while the imports and exports of cross-border e-commerce registered 1.88 trillion yuan, up 11.5 percent year-on-year, both hitting a record high. These figures not only underscore the robust development of China’s digital trade but also highlight the thriving landscape of global digital trade.
The reason why China’s digital trade can achieve such rapid development is the result of a confluence of factors. China’s status as a powerhouse in both the digital economy and foreign trade indicates a strong industrial foundation and vast market potential for the development of digital trade. Also, it benefits from the continuous enhancement of digital infrastructure, advancements in digital technology innovation and the improvement of the digital industry ecosystem.
Now, digital trade has emerged as a vital element of China’s trade and economic development strategy. According to a guideline document issued by the general offices of the Communist Party of China Central Committee and the State Council in late November, China expects the digitally deliverable services trade’s share of the overall services trade to exceed 45 percent by 2029 and 50 percent by 2035.
However, it is important to note that the development of China’s digital trade is also fraught with challenges and obstacles. In the era of digital trade, the application of artificial intelligence (AI) has permeated various facets of global trade, from market analysis and digital products to payment processing and logistics. The advancement and implementation of AI technology have provided significant momentum for digital trade, contributing to a surge in the scale of global digital transactions.
In this context, the US has imposed various restrictions on exports of semiconductor-related products and technology to China in recent years, citing the so-called national security concerns. To a certain extent, these actions are also an attempt to curb China’s progress in the realm of digital trade.
China is the third-largest player in global digital trade, following the EU and the US. The US export restrictions not only affect China but also disrupt the normal functioning of the global digital trade ecosystem and the stability of supply chains. Such measures go against the principles of global economic integration and free trade, limiting opportunities for international digital economic cooperation and hindering the further advancement of global digital trade.
Just as traditional international trade requires an open market system, the development of digital trade also needs the support of an open market environment and free trade rules. This is not only the requirement of the development of digital trade, but also the inevitable trend of global economic integration.
In fact, China and the US share common interests and vast potential for cooperation in the field of digital trade. Making good use of such potential rather than sabotaging it for geopolitical purposes is what is needed for further development of global trade.
Both countries have their own strengths in digital technology, and cooperation can promote technological exchange and innovation. The US has a leading advantage in high-end technology fields such as chips and AI, while China has a wide range of application scenarios and market potential in areas like 5G and big data. Through cooperation, both sides can complement each other’s strengths, driving technological advancement and industrial upgrading.
Moreover, there are opportunities for cooperation between China and the US in shaping digital trade rules and global governance. As digital trade rapidly evolves, the need for a comprehensive global governance system has become increasingly urgent. As key players and advocates in this arena, both countries have the responsibility and capability to actively contribute to the establishment of these rules. By enhancing communication and coordination, they can jointly advance the development of a robust global digital trade governance framework, thereby fostering the prosperity and stability of digital trade worldwide.