By Nethra Sailesh
Artificial Intelligence (AI) could boost global trade by 34-37% according to a World Trade Organization Report. This projection, however, will only be possible if proper policies are in place that lower trade costs and account for productivity gains.
The report also cautions that non-tariff measures, which include export restrictions specifically for AI-enabling items like semiconductors, prohibit AI dissemination.
“AI has vast potential to lower trade costs and boost productivity. However, access to AI technologies and the capacity to participate in digital trade remain highly uneven,” WTO Director-General Ngozi Okonjo-Iweala says in her foreword to the report.
The report found that the AI-enabled goods trade was estimated at $2.3 trillion in 2023. It also showed that there exist quantitative restrictions when it comes to AI-related goods, which went from 130 in 2012 to 500 in 2024. These restrictions include import and export quotas, licensing requirements, or bans that shape the trade of such AI-related products.
To rectify this and fully leverage AI across borders, targeted policies should be in place. They must focus on bridging the digital divide, investing in workforce skills and fostering a reliable and open trade environment. These include policies such as intellectual property and competition policies, infrastructure and labour market policies, and industrial policy. Protecting data privacy also comes under this.
But this isn’t restricted to national policies. Since it deals with regulations that go beyond borders, the report stated that there also have to be collaborations and mutual understanding between international organizations. This will facilitate dialogue between nations and encourage solutions to fully leverage AI’s benefits.
The report, which was launched on September 17, also stated that the WTO can ensure that AI can bring about this growth. This isn’t limited to just bringing out predictable, forward looking, flexible trade policies and removing barriers but would also entail changing the way WTO functions, promoting transparency and interoperability and providing a trusted forum for members to be a part of this digital transformation.