Europe’s Digital Decade?
Navigating the global battle
fordigitalsupremacy
Brigitte Dekker
Maaike Okano-Heijmans
Clingendael Report
Europe’s Digital Decade?
Navigating the global battle for digital supremacy
Brigitte Dekker
Maaike Okano-Heijmans
Clingendael Report
October 2020
October 2020
Cover photo: Global business concept. Network of business. Diversity. © Shutterstock
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About the authors
Brigitte Dekker is a Research Fellow at the Netherlands Institute of International Relations
‘Clingendael’ in The Hague. Her research focuses on various dimensions of EU–Asia relations,
with a specific interest in South-East Asia and China.
Maaike Okano-Heijmans is a Senior Research Fellow at the Netherlands Institute of
International Relations ‘Clingendael’ in The Hague and a visiting lecturer at the University
of Leiden.
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Table of contents
Executive summary 1
1 Introduction 3
Where does Europe stand today? 4
2 Regulation 7
2.1 Personal data flows 9
International context 9
Regional focus: South-East Asia 10
The EU–US Privacy Shield 11
Moving forward 11
2.2 Non-personal data flows 12
2.3 The multilateral context: the WTO 13
3 Business: e-commerce, the platform economy and digital payments 15
3.1 E-commerce 15
3.2 Platform economy 18
International efforts on e-commerce and platform regulation 19
The EU’s turn from defensive to offensive measures? 21
3.3 Digital payments 21
3.4 The multilateral context: the WTO and OECD 23
The Organisation for Economic Cooperation and Development 24
4 Telecommunications infrastructure 25
4.1 5G networks: the embodiment of US–China tech rivalry 25
Asia–Pacific: a region to watch 26
4.2 Cloud computing 28
4.3 The multilateral context: the ITU and beyond 29
5 Conclusion 32
Annexe 1 35
List of abbreviations 37
1
Executive summary
On 16 September 2020, European Commission President Ursula von der Leyen set
a clear goal for the European Union (EU) and its member states when she said
that ‘Europe must now lead the way on digital – or it will have to follow the way
of others, who are setting these standards for us’. She added: ‘We must make this
‘Europe’s Digital Decade’.
Many in Brussels acknowledge today that the half page on digital matters in the
EU connectivity strategy needs to be operationalised and put into action. Efforts to
strengthen Europe’s industrial and digital strategies at home are already being made.
Yet joint, coherent action by EU institutions and stakeholders within member states are
needed not just within the Single Market, but also in and with third countries and in
international networks and institutions.
Central to the debate and any policy decision on digital connectivity are the trade-offs
concerning privacy, business interests and national security. While all regulations are
a combination of these three, the United States (US) has taken a path that prioritises
the interests of businesses. This is manifested, for example, in the strong focus on free
data flows, both personal and non-personal, to strengthen companies’ competitive
advantage in collecting and using data to develop themselves. China’s approach, by
contrast, strongly focuses on state security, wherein Chinese businesses are supported
and leveraged to pre-empt threats to the country and, more specifically, to the Chinese
Communist Party. This is evident from its strict data localisation requirements to prevent
any data from being stored outside its borders and a mandatory security assessment
for cross-border transfers. The European Union represents a third way, emphasising
individuals’ privacy and a human-centred approach that puts people first, and includes
a strong focus on ethics, including in data-protection regulations.
This Clingendael Report aims to increase awareness and debate about the trade-offs
of individual, state and business interests in all subsets of digital connectivity. This is
needed to reach a more sustainable EU approach that will outlast the present decade.
After all, economic competitiveness is required to secure Europe and to further its
principled approach to digital connectivity in the long term. The analysis presented here
covers a wide range of topics within digital connectivity’s three subsets: regulation;
business; and telecommunications infrastructure. Aiming to contribute to improved
European policy-making, this report discusses (best) practices of existing and rising
digital powers in Asia and the United States. In every domain, potential avenues for
cooperation with those countries are explored as ways forward for the EU.
