THE United Nations Conference on Trade and Development (Unctad) cited the Philippines as one of the six countries allowing free flow of data across borders, which is key in boosting the digital economy.

In a recent report, Unctad noted that the country—along with Australia, Canada, Mexico, Singapore and the United States—uses “light-touch approach” for its cross-border data flow.

“This approach appears to be favored mostly by countries with strong regulatory environments and sufficient regulatory resources to monitor compliance of domestic laws, especially by huge foreign companies,” it explained.

The report attributed the Philippines’s use of light-touch approach to its “dependence” on the outsourcing industry, which is considered one of the major economic growth drivers of the country.

The National Privacy Commission (NPC), for its part, said it is important to highlight both privacy rights of the Filipinos while ensuring free flow of information to allow innovation and growth.

“In the ongoing digital transformation of the country as accelerated by the pandemic, the ability of data, whether personal data or not, to move unhindered within and outside the Philippines, is vital for the economy. Of course, such free flow is subject to regulation, especially for the processing of personal data,” the NPC told the BusinessMirror.

As such, the privacy watchdog said this is observed in the business-process outsourcing industry (BPO) of the country.

“The BPO sector relies on the trust and confidence of clients offshore to continue setting-up their businesses here, including the continuous transfer of data to be processed in the Philippines,” the NPC said.

NPC said they make sure the sector is abiding by the Data Privacy Act, including placing security measures and upholding data subject rights, among others.

Meanwhile, those applying “restrictive” or “guarded” approach in their cross-border data flows include China, India, Indonesia, Kazakhstan, Nigeria, Pakistan, Russian Federation, Rwanda, Saudi Arabia, Turkey and Vietnam.

International framework

UNCTAD said the global community should enable digital data to flow freely across borders, raising the need to craft an international framework to allow such activities.

“It is more important than ever to embark on a new path for digital and data governance,” UN Secretary-General António Guterres said. “The current fragmented data landscape risks us failing to capture value that could accrue from digital technologies and it may create more space for substantial harms related to privacy breaches, cyber attacks and other risks.”

The new approach should facilitate “worldwide data sharing, develop global digital public goods, increase trust and reduce uncertainty in the digital economy,” the report explained. Unctad Secretary-General Rebeca Grynspan stressed these are a must amid the pandemic in order to resolve issues with global digital governance.

Shamika N. Sirimanne, Unctad’s director of technology and logistics, said that the countries will find it more challenging to take advantage of the digital economy without a global data governance framework.

In addition, no global framework also means added burden in protecting the privacy for both private sector and government use of data, she said, noting this could also adversely impact law enforcement and national security.

“We need a new regulatory framework that factors in both economic and non-economic dimensions, and that can work for countries at different levels of digital readiness,” Sirimanne pointed out.

Unctad noted that the data-driven digital economy is gaining more foothold, with estimates showing that global Internet protocol traffic will grow more than three times between 2017 and 2022.

This was further supported by the accelerated shift to digital amid the pandemic. The report noted that global Internet bandwidth rose by 35 percent last year, higher than the 26-percent growth in 2019.

Image courtesy of Markus Spiske on Unsplash

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