Vanguard Magazine

Minister of Foreign Affairs Chrystia Freeland meets for a trilateral meeting with Mexico's Secretary of Economy Ildefonso Guajardo Villarreal, le, and Ambassador Robert E. Lighthizer, United States Trade Representative, during the final day of the third round of NAFTA negotiations at Global Af- fairs Canada in Ottawa on Wednesday, Sept. 27, 2017. Photo: Sean Kilpatrick T TECHNOLOGY WaTCH 40 OCTOBER/NOVEMBER 2017 www.vanguardcanada.com competitiveness in all sectors, especially the heavier industrial, physical business- es that we tend to think about when we think about agreements like NAFTA, de- fence included. We need to incentivize entrepreneurs and companies to embrace technology, including digital technolo- gies that will make them more competi- tive. According to McKinsey, cross-border data flows grew by 45 times between 2005 and 2014 and will grow another nine-fold in the subsequent five years. These data flows generated $2.8 trillion in economic value in 2014—a greater im- pact on world GDP than the actual global trade in physical goods. With the expo- nential growth of technology, Moores law is nearly impossible for us to visualize. Once you get into the latter half of the curve, you can't picture the number of shipping containers in the physical world, let alone understand the implication when it comes to digital consumption happen- ing nano seconds after our hearts desire it. Consuming and specifically exporting digital technologies happens by entering your login and password into a website as opposed to physically shipping a product over a border. It is hard to visualize, but yes, when you are using a US-based digital product, you are importing a good in real time. The same thing occurs when our us- ers log into OMX from all over the world, we are exporting our digital product to them. "Digital" is growing faster than any other trade sector, and if barriers to digi- tal trade are reduced, or avoided, in NAF- TA 2.0, we have an opportunity to capi- talize on our capabilities. One area the US is anti-protectionist is digital trade, likely because they dominate global trade in digital. In the TPP negotiations, for in- stance, the US supported an opening up of digital trade. TPP actually disallowed EU and Canadian provinces such as Brit- ish Columbia and Nova Scotia's laws that require personal data to be stored locally, referred to often as "localization". The sentiment in TPP was to open up the dig- ital economy, a sentiment I share. Embracing this new economy and the immense flows that pass virtually across borders takes courage. It sure would be nice to come out of the upcoming nego- tiations with a competitive edge on our ability to consume and sell digital prod- ucts across the virtual border. Nicole Verkindt is the technology editor of Vanguard magazine and founder and president of OMX. She is a board member of the Canadian Commercial Corporation and was recently appointed to the board of the Peter Munk School of Global affairs. Technology is the key to driving innova- tion and increased competitiveness in all sectors, especially the heavier industrial, physical businesses that we tend to think about when we think about agreements like NAFTA, defence included.

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