Dive Brief:

• The World Trade Organization (WTO) concluded its 11th Conference (MC11) with a "groundbreaking decision" to clarify the rules of e-commerce while not imposing tariffs on electronic transmissions — at least until 2019.
• The body also announced a new initiative — Enabling E-commerce — alongside Alibaba's Jack Ma, inviting public and private stakeholders to encourage research and communication on the challenges small businesses face in tapping into the potential of digital trade.
• "It is an important signal that WTO members are moving forward to address modern issues that are relevant to businesses and entrepreneurs everywhere," FedEx said in a statement, adding e-commerce plays a "critical role" in "enabling small businesses to reach new markets and expand exports."

Dive Insight:

The WTO's biannual ministerial conferences are a looking glass into the future of global supply chains.

Once every two years, representatives from 164 member countries meet to discuss economic trends that are promising to shape world trade and find common ground on the issues. This year, e-commerce was in the spotlight, as continues to disrupt the retail landscape in the developed world and begins to shake up developing economies.

"(E-commerce) could be the greatest force for inclusion in the global economy that the world has ever seen. But inclusion is not automatic," WTO Director General Roberto Azevêdo said at the Enabling E-commerce launch event. "Getting this right is a challenge for all of us."

To enable e-commerce, the WTO partnered with the World Economic Forum and the Electronic World Trade Platform. The three groups' joint initiative will begin January, 2018 with a meeting at Davos, Switzerland.

However, encouraging globalization without an eye to developing countries and trade facilitation could lead to a competitive gap between the large businesses with a head start on investment — think UPS and FedEx, Amazon and Alibaba — and their smaller counterparts.

"To take part (in digital trade) you need to have the appropriate ICT infrastructure and services. You need to have functioning trade logistics. You need to have the legal and regulatory frameworks in place. You need to have access to finance. The list goes on," said Azevêdo.

"The problem with globalization is that its benefits have not been made available to all," Jack Ma said at the launch event of Enabling E-commerce in Buenos Aires, Argentina. But "if business and government work together, we can create a more inclusive trade model to expand the benefits of globalization to those who have been left behind."

The initiative should bring hope to shippers. A coalition of world groups working on facilitating e-commerce could set the base rules for cross-border digital trade, which remain largely regulated due to outdated trade rules. High de minimis standards, onerous customs paperwork, tariffs and the cost of currency exchange are currently slowing the growth of global e-commerce networks.

But if history were to repeat itself, such a framework may take years — or even decades, as was the case with the World Trade Organization's Trade Facilitation Agreement — to complete, despite the clear benefits it would provide to the global economy.

"Unfortunately, I doubt anything will move faster when it comes to trying to get agreements amongst this diverse group," Guy Courtin, Vice President of Retail and Fashion at Infor, told Supply Chain Dive. "What I do think/hope is that addressing these issues in this forum might place some pressure on private institutions that could pressure their local governments to move faster."

As a result, shippers should remain encouraged by the trend toward facilitating e-commerce, according to Courtin. "However, does this potentially empower one of their biggest customers ... who could soon be their biggest competitor — Amazon? Or Alibaba?"

"While reducing friction for more e-commerce is great for logistics providers, it's also great for large retailers," he added. Specially if those large retailers can more easily procure supplies from abroad, and include such merchandise on their proprietary digital marketplaces.

If anything, were the global initiative to succeed, it could empower small businesses to integrate further into global supply chains.