WT/GC/W/905  
20 November  2023 
(23-7807) Page: 1/4 
General Council  Original:  English  
 
  
WORK PROGRAMME ON ELECTRONIC COMMERCE  
COMMUNICATION FROM DJIBOUTI ON BEHALF OF THE LDC GROUP  
The following communication, dated 17 November 2023 , is being circulated at the request of the  
delegation of Djibouti, on behalf of the LDC Group.  
 
_______________  
 
1  INTRODUCTION  
1.1.  This communication updates the 2019 WT/GC/W/787  submission of the LDC Group in respect 
of the WTO Work Programme  on Electronic Commerce  and the moratorium. The submission 
identified thirteen areas in which the least developed countries (LDCs) run capacity deficits in relation 
to e-commerce. These deficits were represented by six distinct categories, namely: human resources 
technical capacity; institutional capacity; regulato ry capacity; infrastructural capacity; supply 
capacity; and access to finance. The present submission highlights some positive developments 
along with gaps that remain. The purpose of the submission is to foster constructive engagement 
under the Work Programme and WTO 's collaboration with other organisations and to provide inputs 
into the reporting going forward to MC13.  
2  OBJECTIVES  
2.1.  The objective of this submission is to elaborate on some of the above referred areas of capacity 
deficits and raise a call to a ction by Members in favour of LDCs. This is with a view to ensuring that, 
key to the engagement of Members on e -commerce are distinct deliverables that specifically address 
LDCs capacity deficits. It is further to ensure that no countries, in particular LD Cs, are left behind in 
the 4th industrial revolution. The submission also provides information on progress registered 
in LDCs.  
3  LDC E -COMMERCE CAPACITY LANDSCAPE – ACCESS TO TECHNOLOGIES  
3.1.  Unyielding challenge of access to electricity remains significant in L DCs. Globally, more than 
500 million people who have no energy access reside in LDCs. This represents a 52% electrification 
rate, compared with the 90% global average.1 This problem is more serious in rural areas, as only 
39% of the rural population has access to power. Regarding internet access, at one extreme with 
less than 20% of people in Europe having no access to the internet,  in LDCs on the other extreme,  
over 80 % of inhabitants are reportedly  without internet access.2 The above challenges are 
exacerbated by a further challenge of unequal access to new technologies.  
Access to Technology and Technology Divide  
3.2.  Regarding urban -rural access to technology and technology divide, 16% of LDCs ' rural 
population have no access to any mobile network, and a meagre  35% is connected online with a 
 
1 UN-OHRLLS and RMI (2021) Opportunities for Achieving Universal Energy Access through the Energy 
Transition in the Least Developed Countries  United Nations, New York.  
2 International  Telecommunication Union, 2018. It is important to note that even where internet is 
accessible this does not equate to the only basis for engaging in e -commerce. Smartphone prices are extremely 
high in the LDCs, ha mpering Internet take -up. As an example, affordability rate of smartphone in Cambodia 
stands at 52% while in Bangladesh at 23% affordability level. ITU (2021) Connectivity in the Least Developed 
Countries Status report 2021  ITU, Geneva.  WT/GC/W/905  
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  mobile device.3 Further, on average fixed broadband monthly price in developed countries stands at 
1.4% of per capita GNI, d eveloping countries 42.7% and LDCs the highest at 54.4%.4 Broadband 
internet user penetration is projected to reach 75% globally by 2025, while LDCs will trail behind at 
31% relative to 70% in developing countries.5 
3.3.  In respect of affordability of mobile Internet, on average the price of the mobile cellular basket 
in developed countries is 1% of GNI per capita, developing countries stand at 4.5%  and LDCs 9.8%.6 
Overall 23% of the population in LDCs has no access to a mobile  broadband network despite UN 
SDG goal 9 's target to increase access to ICTs and strive to provide universal and affordable access 
to the Internet by 2020.7 All this attests to poor digital infrastructure in LDCs which in turn renders 
new technologies largely unaffordable and inaccessib le for these countries.8 Consequently, this 
breeds unequal access to products and services enabled by new technologies. Across several 
emerging digital technologies, ranging from blockchain, 3D  printing, Internet of Things, 5G mobile 
broadband, cloud comp uting, automation and robotics to AI and data analytics, LDCs are trailing 
significantly behind other categories of countries.9 
Online Market Share  
3.4.  LDCs' share of population shopping online is extremely limited averaging around 2%. By the 
same token, when  it comes to B2C e -commerce, on average LDCs trend around an average of 20% 
whereas developing countries are slightly above 50% and developed  countries at around 80%. All 
this highlights the extent of capacity deficits while at the same time distinguishing  the areas in need 
of deliberate focus in the case of LDCs.  
3.5.  The decrease in ODA targeted at LDCs is concerning, in particular, in relation to ICT and 
technological research and development. In this regard, in 2017, only 3.78 % of ODA commitments 
to develop ing countries was reported under sectors associated with science Technology and 
Innovation by sector as follows: post -secondary education  2.96%; to research and scientific 
institutions 0.59%; ICT 0.09%; to technological research and development 0.04 %.10 
Digital and Talent Gap 
3.6.  With advanced digital know -how becoming critical for employment, a "talent gap" for 
employment with advanced digital competencies is increasing. The growing need for ICT -qualified 
persons in many LDCs cannot be overemphasized, albeit c ompounded by challenges presented 
above. These have the effect of feeding digital divide as reflected by persistent need to boost 
knowledge levels and education divide.  
3.7.  Meaningful engagement in the 4th industrial revolution, the basis of which e -commerce t hrives, 
requires specific and complementary digital innovations that serve as sources of productivity growth 
for the LDCs.11 Consequently, to address talent/skills gaps and slow technological adoption in LDCs, 
digital policies and digital investments will be critical as agents that provide enabling environment 
for investments in digital skills.12 Consequently, a comprehensive framework aimed at promoting 
enterprise -enabling environment and development of human productive capabilities while creating 
 
3 UNCTAD (2021) DIGITAL ECONOMY REPORT - Cross -border data flows and development: For whom the 
data flow  United Nations, Geneva.  
4 Ibid. 
5 ITU and UNESCO (2020) State of Broadband Report 2020: Tackling digital inequalities – A decade for 
action  ITU, Geneva.  
6 UNCTAD (2021) Harnessing rapid technological change for inclusive and sustainable development  United 
Nations, Geneva.  
7 Infra 3.  
8 Only Bangladesh and Bhutan are determined to have achieved SDG Target 9.c. See ITU (2021) 
Connectivity in the Least Developed Countries Stat us report 2021  ITU, Geneva.  
9 UNCTAD (2019) Digital Economy Report 2019 - Value Creation and Capture: Implications for Developing 
Countries  United Nations, Geneva.  
10 UNCTAD (2021) DIGITAL ECONOMY REPORT - Cross -border data flows and development: For whom 
the data flow  United Nations, Geneva.  
11 ILO (2022) Present and future of work in the Least Developed Countries  International Labo ur 
Organisation , Geneva.  
12 ILO (2021) Changing demand for skills in digital economies and societies: Literature review and case 
studies from low - and middle - income countries  International Labo ur Organisation, Geneva.  WT/GC/W/905  
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  more dec ent jobs would be necessary.13 Overall, to ensure that no country is left behind, 
development partners should contribute to supporting bridging of the digital infrastructure and 
technological gaps in LDCs.  
Infrastructural and Supply Capacity  
3.8.  LDCs run signi ficant infrastructural incapacity. These, among others, range from limited 
Internet access in rural/remote areas and costly access to fixed and mobile -broadband Internet, to 
inadequate facilities for physical delivery of online purchases. Specific to e -commerce supply 
capacity, LDCs tend to be least performers in terms of their share of ICT goods and services 
compared to other regions. This reflects the limited ability of many LDCs to leverage digital 
technologies to engage in services trade. Network effect s, coupled with access to data and 
economies of scale and scope, being dominant features of concentrated market power by a few 
entities, imply that entry costs for many LDCs in e -commerce markets will be significantly high. As 
a result, LDC companies large ly do not feature to 100 global digital platforms by market 
capitalization. Lack of finance for research and development in LDCs, inter alia , explains their 
limitations and deficits  regarding development of industrial technologies for production.14 In this 
context, the  intricate link between the extent of supply capacity and access to finance cannot be 
overemphasized.  
Legal and Regulatory Capacity  
3.9.  To play a meaningful role in e -commerce, LDCs must strengthen their legal and regulatory 
frameworks. Out of date and non -adapted legal frameworks characterize LDCs regulatory framework 
on e-commerce. Undeveloped regulatory frameworks where needed in e -commerce in turn implies 
some improvements in the institutional framework. Buildin g the capacity of LDCs to rationalize 
regulatory prerequisites to beneficially take part in the global e -commerce marketplace is therefore 
of crucial importance. This will, among others, pave way to integration of LDCs into the e -commerce 
marketplace.  Furthermore, establishment of regulatory authorities, registration of e -commerce 
companies including micro, medium, and small -scale enterprises (MSMEs), online complaint 
management systems, integration of online payments, logistics,  etc. will help to furnish e -commerce 
sector development.  
Taxation and WTO E-Commerce Moratorium  
3.10.  In respect of e -commerce taxation and moratorium, several studies on these matters have 
provided varied outcomes particularly in light of their divergent methodological assumptions. 
Never theless, there is need for LDCs -specific study that provides technical assessments of 
implications of the moratorium based on unique attributes of LDCs including about LDC own 
mechanisms or lack thereof. Key will also be the technologies needed in this are a, at least as a start 
on LDC value -added tax systems, where needed.  
4  MEASURES BY LDCS TO HARNESS THE VALUE OUT OF E -COMMERCE  
4.1.  The above notwithstanding, there are areas where LDCs have progressed, although at a slow 
pace. Some LDCs have conducted e -commerce  readiness assessments registering increase in the 
number of internet users, postal reliability and secure servers.15 From the e - commerce readiness 
assessments, opportunities in e -commerce for the LDCs lie in the following areas: strategy 
formulation, ICT  infrastructure and services, trade logistics and trade facilitation, payment solutions, 
legal and regulatory frameworks, e -commerce skills development, and access to financing.16 
4.2.  LDCs are making significant efforts to actualize the economic development pr omise of 
e-commerce. This includes synchronization of postal and customs interface, and building capacity 
for MSMEs to carry out small parcel e -commerce. The net result has been increased number of 
registrants on e -commerce marketplaces and creation of job s including for women. Furthermore, 
 
13 Ibid. 
14 UNCTAD (2021) Technology and Innovation Report 2021: Catching technological waves – Innovation 
with equity  UN, Geneva.  
15 Guinea, Ethiopia  and Djibouti fall in this category of countries. See UNCTAD (2022) E-Commerce and 
the Digital Economy in LDCs: At Breaking Point in COVID -19 Times  UNCTAD Geneva.  
16 Ibid. WT/GC/W/905  
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  within their available capacity LDCs have further invested in digital skills development, MSMES 
incubation on business digitization inclusive of training on digital technologies. These developments 
all took place in the context of a multi -sector and ecosystem context.17 
4.3.  Further selected developments in LDCs are notable. These include: development ICT sector, 
among others, through increasing international internet bandwidth; fostering high internet 
connectivity; higher mob ile and smart phone penetration rates; addressing the needs of the 
e-commerce ready population; creating competition, in particular among financial service and 
payment service providers; and , putting in place key public policies covering sustainable 
develo pment, trade development and ICT development.18 
4.4.  In respect of adoption of e -commerce related legislation, LDCs are variably making steady 
progress. Out of 46 LDCs, e -commerce related legislative developments in term of legislations 
enacted are as follows: 63% on Electronic Transactions; 41% Consumer Protection; 48% on Privacy 
and Data Protection; and 70% on Cybercrime.19 
5  CONCLUSION  
5.1.  In view of the foregoing, many LDCs remain on the periphery of global e -commerce markets. 
Various opportunities in the gaps are  evident, and these are reflective of areas in which targeted 
capacity building and technical assistance interventions would be required to address the areas 
identified in this submission including beyond those identified in this submission. It is equally 
important to underline the fact that LDCs have been dispensing their best efforts within the 
limitations of their resources to advance the e -commerce agenda. These efforts are notable for 
building policy, legislative, and digital know -how in e -commerce rel ated infrastructure. ICT and 
e-commerce advanced developing countries might also create partnerships and provide 
infrastructure, technological and technical expertise in LDC urban and rural areas.  
5.2.  LDCs run significant ICT and, technology research and devel opment deficits all exacerbated by 
steep decrease in ODA. Concurrent needs in digital know -how and skills further must be met to 
move many LDCs from the periphery of e -commerce and the 4th industrial revolution. Moreover, the 
e-commerce backbone infrastruc ture is in extreme short supply in many LDCs. Coupled with 
persistent needs in electricity accessibility, the ability of LDCs to leverage digital technologies in the 
context of e -commerce is extremely limited.  
5.3.  In the context of the WTO Work Programme on E-commerce, the LDC point of departure is 
notably, qualitatively distinct from that of other Members as it is much more than  creation of 
multilateral rules on e -commerce. Within the framework the WTO Work Programme, LDC oriented 
deliverables should be priori tized, particularly in the following areas: human resources technical 
capacity; institutional capacity; regulatory capacity; infrastructural capacity; supply capacity; and 
access to finance. These should be considered interdependently given their intricate  functional and 
operational relationship. On e -commerce tariffs and digital taxation, there is need for an LDC -specific 
study that provides for technical assessments of the implications of the WTO e -commerce 
moratorium taking into account specific attribut es of LDCs.  
5.4.  We recommend that the WTO might consider setting up a mechanism of information and 
collaborations with other institutions specific to LDC participation in e -commerce and aspects to 
assist in closing gaps. This should also include up -to-date inf ormation on LDC systems in relation to 
the areas mentioned above. A road map within the Work Programme should be considered that will 
help us track the evolution of progress in the Work Programme within the WTO 's role.  
 
 
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17 Annette Ssemuwemba (2023) "BUILDING RESILIENCE After the pandemic storms, digital t rade offers 
LDCs rays of sunshine ". Available at https://oecd -development -matters.org/2023/06/13/after -the-pandemic -
storms -digital-trade -offers -ldcs-rays-of-sunshine/  Accessed on 21 July 2023 . 
18 UNESCAP (2019) Leveraging e -commerce for graduation of least developed countries  UN, Bangkok.  
19 UNCTAD (2023) Global Cyberlaw Tracker: Summary Adoptio n of E -Commerce Legislation Worldwide  
Available at: https://unctad.org/topic/ecommerce -and-digital -economy/ecommerce -law-reform/global -
cyberla w-tracker  Accessed on 21 July 2023.