WORLD TRADE  
ORGANIZATION   
WT/GC/W/635 
G/C/W/650 
WT/COMTD/W/179 14 July 2011 
 
 
(11-3512) 
General Council Council for Trade in Goods Committee on Trade and Development Original:   Spanish 
 
  
EFFECTIVE PARTICIPATION OF DEVELOPING COUNTRIES IN ELECTRONIC 
COMMERCE AS A MEANS TO COMBAT POVERTY 
 
Communication from Cuba, Ecuador and Nicaragua 
 
  The following communication, dated 13 July 2011, is being circulated at the request of the delegations of Cuba, Ecuador and Nicaragua. 
 
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1. Work Programme on Electronic Commerce 
1. On 25 September 1998, WTO Members agreed  to establish the Work Programme on 
Electronic Commerce "… to examine all trade-rela ted issues relating to global electronic commerce, 
taking into account the economic, financial, and de velopment needs of developing countries".  After 
several years of extensive discussion, the four subs idiary bodies responsible for the Work Programme 
identified a considerable number of obstacles hinderi ng the participation of developing countries in 
this mode of trade, but unfortunately the ex amination of the matter was not completed. 
2. At the Seventh Session of the Ministerial Conference
1, Members decided to intensively 
reinvigorate that work with a view to adopting decisions  on this issue at the next session, to be held in 
2011.  It was agreed that the work programme would include development-related issues, basic 
WTO principles, including, among others, non-discrimination, predictability and transparency, and discussions on the trade treatment, inter alia , of electronically delivered software.  The purpose of this 
paper, therefore, is to examine a range of signi ficant difficulties faced by developing countries and 
make recommendations on action to be taken. 
2. Background 
3. As is well known, electronic commerce consists of  the buying or selling of goods or services 
by businesses, households, individuals, governments or other public or private organizations, through 
computer networks, whether in open environmen ts such as the Web or in closed communication 
environments. 
4. From the mid-1990s, the development of info rmation and communication technologies (ICTs) 
led to an increase in the types of  trade conducted by electronic means, thus giving rise to the concept 
of "electronic business", which broadens conventi onal e-commerce facilities through the addition of 
                                                      
1 WT/L/782, Ministerial Deci sion of 2 December 2009. WT/GC/W/635 
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  new applications such as Electronic Funds Transfer
2, Internet marketing3, Electronic Data 
Interchange (EDI)4, Customer Relationship Management, and new business models for companies 
and even consumers, all of which extend the scope  of and reduce the costs and distances involved in 
trade in goods and services. 
5. In recent years, however, the increase in the different forms of e-business has not been 
uniform in all countries and has widened the ex isting digital divide between developed and 
developing countries.  A study5 carried out by Everis, a Spanish multinational consultancy firm, and 
the Centre for Latin American Studies of the Univer sity of Navarra, shows that, in 2009, 82.3 per cent 
of world electronic sales were concentrated in developed countries, primarily the United States and 
Japan, with only 17.7 per cent being ascribable to developing countries, three quarters thereof to 
Brazil, India, China, Indonesia, Turkey and Russia. 
6. This digital divide limits the production and dissemination of knowledge, exacerbates 
economic backwardness and dangerous ly intensifies the lack of understanding between peoples.  
Given the benefits already available to many coun tries through the Internet and electronic commerce, 
not having access to that environment and to all the technology needed for its development is a 
problem that should be addressed urgently. 
3. Factors limiting electronic commerce in developing countries 
7. In 2010, the analysis and study unit of América Economía  magazine conducted a study6 on 
different variables linked to the development of electronic commerce in Latin America, the 
United States and Spain.  Although the Latin Amer ican region showed an improvement between 2005 
and 2009, a number of factors continue to lim it the development of this form of commerce. 
8. In the 187 Latin American countries examined, just 33.2 per cent of the total population are 
Internet users, far fewer than the 78.9 per cent in the United States.  The region's infrastructure 
(broadband8 connections and prices, fixed telephon es, mobile telephones, number of personal 
computers) is equivalent to 59 per cent of Spain's infrastructure.  For example, Latin America has one 
broadband connection for every 15 inhabitants, while Spain has one for every 4.5 inhabitants, and the 
United States one for every 3.9.  In Spain there are 504 computers for every 1,000 inhabitants;  in the 
United States the figure rises to 932, while in Latin America the average is only 180. 
                                                      
2 Movement of funds between bank accounts through electronic systems of remote collection and 
payment between entities and/or individuals;  also applicable to remittances. 
3 Advertising and publicity via Web pages and the sending of mass e-mails (spam), sometimes 
unsolicited, for commercial purposes. 
4 Sending and receiving of business documents, such as purchase orders, and electronic distribution of 
invoices with remote payment options;  paperless and time-efficient. 
5 "Ventas del comercio electrónico mundial sumaron US$500.000 millones en 2009" ("Global 
e-commerce sales totalled US$500,000 million in  2009").  Article available in Spanish at 
http://www.americaeconomia.com/negocio s-industrias/ventas-del-comerc io-electronico-m undial-sumaron-
us500000m-en-2009 . 
6 "e-Readiness en América Latina" ("e-Readiness in La tin America").  Article available in Spanish at 
http://www.ecommerceday.mx/wp-content/uploads/2 010/10/Visa-America-Economia-Estudio-Regional-
eCommerce-Inserto-2.pdf . 
7 Argentina, Bolivia, Brazil, Chile, Colombia, Do minican Republic, Ecuador , Guatemala, Honduras, 
Mexico, Nicaragua, Panama, Peru, Puerto Rico, Pa raguay, El Salvador, Uruguay and Venezuela. 
8 Telecommunication networks that allow the transmission of information in the format and at the 
speed required for the transmission of voice signals, data and still and moving images through a single 
infrastructure, in particular through the Internet.  WT/GC/W/635 
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  9. The availability of banking facilities, analysed in terms of the number of users of credit and 
debit cards and the number of cash dispensers, also re veals disparities.  At the end of 2009, credit card 
penetration stood at 37 per cent in Latin Americ a, while in Spain it was 70 per cent and in the 
United States 188 per cent.  There were 0.5 cash disp ensers for every 1,000 inhabitants, a figure much 
lower than in the other two countries (between 1.4 and 1.7). 
10. Other difficulties concern discriminatory cond itions relating to international access and 
connection to the Internet or other forms of te chnology needed for data protection, electronic 
payment, and content and privacy regulation, and the fiscal implications of electronic commerce. 
11. Despite major differences in the prices of broa dband in the region (some users pay between 
US$30 and US$53, others between US$13 and US$25), its  high cost is one of the greatest obstacles to 
the further development of the electronic commerce infrastructure.  The way in which the Internet 
operates also affects this situation:  the main  networks, known as "backbones", are controlled by the 
largest telecommunications operators (e.g. Worl dCom, Telmex, and Cable & Wireless), which 
establish fee waiver agreements among similar companies and apply discriminatory access conditions 
and costs for Internet service providers of de veloping countries passing through their network. 
4. Contributors of the International Teleco mmunication Union (ITU) to solving the 
above-mentioned problems 
12. The World Summit on the Information Societ y (WSIS) was organized by the ITU in 
two stages, Geneva 2003 and Tunis 2005, to discuss and address the significant impact of ICTs (in 
particular the Internet) on the global community.  Th e declarations and plans of action adopted by the 
WSIS provide an important basis for the work to  be done by governments, the private sector, civil 
society and international organizations to ensure  universal access to information and communication 
infrastructure and to create confidence and security in the use of ICTs, among other decisive factors for the construction of a true Information Soci ety that contributes to the achievement of the 
Millennium Development Goals. 
13. The Geneva Plan of Action recognizes that infr astructure is central to achieving the goal of 
digital inclusion and to promoting universal, sust ainable, ubiquitous and affordable access to ICTs, 
thus furthering global connectivity and the de velopment of broadband network infrastructure. 
14. It is also recognized that network confidence and security are the mainstays of the 
Information Society.  For this reason, it is im portant not only to enc ourage cooperation between 
governments in order to protect data and network in tegrity, but to collaborate with the private sector 
with a view to preventing, detecting and responding to cybercrime and counter acting the mass sending 
of unsolicited e-mails (spam) at national and international level. 
15. In the Tunis Agenda it was emphasized that market forces alone cannot guarantee the full 
participation of developing countries in the globa l market for ICT enabled services and that public 
policies should be implemented to  seek more funding to:  (i) in crease access to communications and 
connectivity in disadvantaged regions;  (ii) de velop regional backbone in frastructure, regional 
networks, network access points and related regional projects to link networks across borders;  and 
(iii) increase broadband capacity. 
16. In October 2008, the World Telecommunicati on Standardization Assembly held in 
Johannesburg adopted Resolution 69 on non-di scriminatory access to public Internet sites9, which 
                                                      
9 Available on the ITU website:  http://www.itu.int/publ/T-RES-T.69-2008/en . WT/GC/W/635 
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  invites Member States to refrain from taking any unilateral and/or discrimin atory action that could 
impede another Member State from accessing public Internet sites. 
17. Recommendation ITU-T D.50
10 was also adopted, which recommends that administrations 
take appropriate measures nationally to ensure that all parties (including operating agencies 
authorized by Member States) involved in the pr ovision of international Internet connections 
negotiate and agree to bilateral commercial arrange ments, or other arrangements as agreed between 
administrations, enabling direct international Intern et connections that take into account the possible 
need for compensation between them for the value of elements such as traffic flow, number of routes, 
geographical coverage and cost of international transmission, and th e possible application of network 
externalities. 
5. Electronic commerce and micro, sma ll and medium-sized enterprises 
18. The Information Economy Report 201011, published by UNCTAD last October, emphasizes 
that poverty has an important informational di mension, since poor people often lack access to 
information that is vital to their lives a nd livelihoods, which increases their vulnerability. 
19. The report indicates that in the past decade, th e scope for ICTs to affect development and 
poverty has expanded in several respects and th ere are currently more opportunities for these 
technologies to contribute positively to developmen t.  At the same time, the involvement of 
developing countries and poor people and communities as consumers and producers of ICTs is also 
evolving.  The report highlights the importance of exploring every opportunity to boost the 
development impact of this new situation. 
20. Business growth can contribute significantly to poverty reduction by  generating income 
through the diversification or upgrading of existin g economic activities and the establishment of new 
undertakings.  The contribution of ICTs in this ar ea lies in their power to give poor women and men 
access to improved information and better communi cations so as to help them generate and 
accumulate livelihood assets. 
21. From the perspective of poverty reduction, it is important to focus on enterprises that are of 
most interest to the poor, usually micro enterprises wh ich typically provide income  to one third or half 
of the working population in developing countries12, and small and medium-sized enterprises.  
Evidence shows that small enterprises tend to be the main engine for job creation, despite also being 
the sector with the highest rate of job destruction. 
22. The report states that the opportunities created by electronic commerce have not yet had a 
major impact on small producers in low-income countri es;  that there is little evidence to show that 
producers in developing countries trade significant quantities of goods and services online;  and that, in general, both B2B (business-to-business) and B2C (business-to-consumer) electronic commerce have largely failed to deliver the considerable poten tial benefits predicted in the earlier part of the 
decade.  The overall picture is one of slow progress for electronic commerce directly benefiting small 
producers and micro-entrepreneurs. 
                                                      
10 Available on the ITU website:  http://www.itu.int/rec/T-REC-D.50/e . 
11 Information Economy Report 2010:  ICTs, Enterprises and Poverty Alleviation, United Nations 
publication , UNCTAD, 2010, Switzerland, page 3. 
12 Idem , page 8.  WT/GC/W/635 
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  23. With a view to beginning work aimed at mitig ating risks and promoting the fullest use of 
ICTs by micro, small and medium-sized enterpri ses in middle-income and low-income developing 
countries, the following general objectives are proposed: 
(a) To create or develop the capacity of small producers, including micro, small and 
medium-sized enterprises, in developing countries to use/exploit electronic commerce and ICTs in general; 
(b) to use/exploit electronic commerce and ICTs  in general to improve the productive, 
commercial and business performance of small producers, including micro, small and 
medium-sized enterprises, in developing countries; 
(c) to facilitate the free flow, without discri mination, of the technologies required to 
use/exploit electronic commerce. 
6. Proposed actions 
24. The exponential speed of ICT development, th e many regulatory areas linked to electronic 
commerce (intellectual property, taxation, privacy, consumer protection, security), and the lack of 
explicit support for micro, small and medium-sized enterprises in developing countries in terms of the 
effective use and exploitation of electronic comm erce as a tool for poverty alleviation, pose a 
significant challenge to the international community , in particular to governments and international 
organizations, which should make it a priority to sy nergize their efforts, since one entity alone cannot 
solve all the existing problems or establish effec tive, appropriate and operational measures to 
eliminate, or even reduce, the difficulties faced by developing countries in accessing ICTs.  It is 
therefore in the hands of WTO Members to help find solutions to the above issues by taking the 
following steps: 
(a) At the next session of the Ministerial Conference, adopt a decision allowing: 
 Access, on non-discriminatory terms, to all information and communication 
technologies for the growth of electronic commerce in developing countries, 
including access to public Internet sites.   The establishment of a permanent 
notification mechanism in the Committee on Trade and Development for cases in which such access has been obstructed. 
 The adoption of measures to encourage providers of international Internet 
connections to agree to bilateral or regi onal commercial arrangements enabling direct 
international Internet connections and increasing broadband connectivity and capacity 
in developing countries, reducing current costs.  Monitoring, by the Committee on 
Trade and Development, of the implementa tion of national and regional initiatives to 
this end. 
 
(b) Set up a working group on the relationship between electronic commerce and 
development, open to the participation of all Members, under the auspices of the 
Committee on Trade and Development.  This Working Group, with support from the 
Secretariat, shall examine the most eff ective and efficient means of promoting 
achievement of objectives relating to training, and the use and facilitation of access to electronic commerce by micro, small and medium-sized enterprises.  The working 
group shall report periodically, at least ev ery six months, to the Committee on Trade 
and Development: WT/GC/W/635 
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   The Committee on Trade and Development, on the basis of the report submitted by 
the Working Group on Electronic Commerce and Development, shall identify the 
most effective and efficient means of promoting achievement of the objectives 
established in the WTO framework.  The Committee on Trade and Development in 
Special Session shall submit reports with recommendations to the General Council. 
 
 The General Council shall consider the reports of the Committee on Trade and 
Development in Special Session and decide on any action it deems necessary, with a view to supporting and promoting the use of electronic commerce by developing countries as a tool for development and poverty reduction. 
 
 The Working Group on Electronic Commerce and Development shall organize 
discussions and/or workshops.  Participation shall be open not only to representatives 
of Members, but to public and privat e entities, international organizations, 
non-governmental organizations  and individual experts.  Through such activities, the 
Working Group shall promote, inter alia , the following actions: 
 
(i) The sharing of experiences:  identification of actions yielding poor results or 
no results at all, analysis of successful experiences, identification of the conditions required and replication possibilities. 
(ii) Analysis of best public (government) support practices. 
(iii) Consideration of new alternatives. 
(iv) Consideration of regulatory issues (regulatory environments). 
(v) Study of institutional issues (institutional and infrastructure capacity). 
(vi) Alternatives for the provision of technical assistance. 
 
(c) Work in conjunction with other organizati ons such as UNCTAD, ITU and WIPO to 
prepare periodic reports on the participa tion of developing countries in global 
electronic commerce, which will help th e various subsidiary bodies to monitor 
solutions to the problems faced by devel oping countries in using electronic commerce 
as a tool for development. 
(d) Incorporate electronic commerce into the Aid for Trade initiative and the 
Trade-Related Technical Assistance organized  by the WTO Institute for Training and 
Technical Cooperation, with a view to impr oving the technical capacity of developing 
countries in the formulation of electronic commerce-related public policies, laws and 
regulations resulting from the rights and oblig ations established in the WTO covered 
agreements. 
(e) Extend the observer status of the ITU to ot her subsidiary bodies of the WTO, such as 
the General Council, the Council for Trade in Goods and the Committee on Trade and 
Development. 
(f) Establish a regular exchange of information between the ITU Secretariat and the 
relevant subsidiary bodies on the implemen tation of the Geneva Plan of Action and 
Tunis Agenda, with a view to assessing, if necessary, the adoption of any other 
decisions or measures within the WTO framework. 
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  Draft Ministerial Decision on Effective Participation in Electronic Commerce 
as a Means to Combat Poverty 
 
 
The Members,   Recalling that , under the Declaration on Global Electronic Commerce of 20 May 1998 
(WT/MIN(98)/DEC/2), Members agreed to establish "a comprehensive work programme to examine 
all trade-related issues relating to global electronic commerce, including those issues identified by 
Members".  Under that work programme, Members also agreed to "take into account the economic, 
financial and development needs of developing  countries" in relation to economic commerce; 
  Recalling that , pursuant to the mandate assigned by Members in the Geneva Ministerial 
Declaration of 20 May 1998, the WTO Genera l Council adopted on 25 September 1998 (WT/L/274) 
the "Work Programme on Electronic Commerce" with  the mandate to "examine all trade-related 
issues relating to global electronic commerce, speci fically taking into account  the economic, financial 
and development needs of developing countries";   Recalling that , at the Seventh Session of the Ministerial Conference (WT/L/782), Members 
decided to intensively reinvigorate that work, with a view to the adoption of decisions on that subject 
at the next session, to be held in 2011;  and th at Members agreed that "the Work Programme shall 
include development-related issues, basi c WTO principles including among others 
non-discrimination, predictability and transpar ency, and discussions on the trade treatment, inter alia , 
of electronically delivered software"; 
 
 Taking into account  that the World Telecommunication Standardization Assembly held in 
Johannesburg in October 2008 adopted Resolution 69 on non-discriminatory access to public Internet 
sites, and that International Telecommunicati on Union Recommendation No. ITU-TD.50 called on 
administrations to take appropriate measures nationa lly to ensure that all parties involved in the 
provision of international Internet connections  negotiate and agree to bilateral commercial 
arrangements, or other arrangements enabling direct international Internet connections; 
  Recognizing that although the expansion of el ectronic commerce has created new 
opportunities for trade and thus contributed to raising standards of living and expanding the 
production of and trade in goods, th at expansion has not been bala nced nor have benefits accrued 
therefrom to developing countries on a scale commensurate with their economic development needs; 
  Observing  that the ICTs in general, and electronic commerce in particular, may contribute to 
combating poverty and that, from that standpoint, it is important to pay particular attention to the 
needs of small producers, including micro, small an d medium-sized enterprises, as job creators;  and 
that it is particularly necessary to promote the creation or development of their capacities to 
use/exploit economic commerce and the ICTs as well as to promote the use/exploitation of electronic 
commerce and the ICTs to improve produc tive, commercial and business performance; 
  Decide : 
 
1. To promote access, on non-discriminatory te rms, to all information and communication 
technologies for the growth of electronic commerc e in developing countries, including access to 
public Internet sites.  A permanent reporting m echanism shall be established in the Committee on 
Trade and Development for cases in whic h such access has been obstructed. WT/GC/W/635 
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  2. To recommend that providers of internationa l Internet connections agree to bilateral or 
regional commercial arrangements enabling them to est ablish direct international Internet connections 
and to increase broadband connectivity and capacity in developing countries, reducing current costs.  
The Committee on Trade and Development shall mon itor the implementation of national and regional 
initiatives to this end.  3. To set up a working group on the rela tionship between electronic commerce and 
development, open to the participation of all Me mbers, under the auspices of the Committee on Trade 
and Development.  The Working Group, with sup port from the Secretariat, shall examine the most 
effective and efficient means of promoting achieveme nt of objectives relating to training, and the use 
and facilitation of access to electronic commerce by small producers, including micro, small and medium-sized enterprises.  The Working Group shall re port periodically, at least every six months, to 
the Committee on Trade and Development. 
 
4. The Committee on Trade and Development, on the basis of the reports submitted by the 
Working Group on Electronic Commerce and Developm ent, shall identify the most effective and 
efficient means of promoting achievement of the objectives established in the WTO framework.  The 
Committee on Trade and Development, in special  session, shall submit periodic reports with 
recommendations to the General Council. 
 
5. The General Council shall consider the repor ts of the Committee on Trade and Development 
in Special Session and shall decide on any action it deems necessary, with a view to supporting and 
promoting the development of electronic commerce by developing countries as a tool for development 
and poverty reduction. 
 
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