unctad.org | G-20 Consumer Summit
Statement by Mr. Mukhisa Kituyi, Secretary-General of UNCTAD
G-20 Consumer Summit
Berlin
15 Mar 2017

 
Global consumer protection in the digital era - the UN role
[Delivered by Ms. Teresa Moreira
Head, Competition and Consumer Policies Branch, UNCTAD]
 

With globalization under fire, and with weak global aggregate demand post-crisis, consumers must play an important role in restarting global growth, ending poverty and leaving no one behind - especially with the rapid growth of digital markets.

Today, global trade is growing at its slowest rate in 70 years, but UNCTAD information economy statistics show that digital commerce is expanding 4 times as fast as the global economy, expanding from $16 trillion per year in 2013 to $22.1 trillion per year in 2015.

Traditional supply side reforms lowered trade barriers to create an enabling environment for business. Today, policy increasingly looks to affect the demand side of the market, focusing on protecting consumers and making them actors of development.

This shift in attitudes couldn't have come at a more opportune time: Consumption represents 60% of the world's GDP, yet 60% of consumers worldwide are still offline.

The historic revision of the United Nations Guidelines for Consumer Protection by the General Assembly in December 2015 is part of this change in mindset and can help empower individual consumers and foster trust in newly emerging digital markets.

The 21st Century consumer is a global consumer. The digitalisation of global economy means that today's economic and social development depends more than ever on consumers conduct.

There is also growing awareness globally of the shared interest in protecting consumers, as a means to achieve the Sustainable Development Goals.

These are not issues for developed countries alone. In fact, the greatest dynamism in electronic commerce can be found in developing countries.

In Asia, China is the largest B-2-C market in the world, and in Indonesia, 9 of 10 online consumers have social media accounts.

Africa is an innovator in e-commerce with a revolution underway in the use of mobile payment solutions.

And Latin American consumers have high demand for online commerce but buy mostly from international platforms, hinting at the potential for deeper domestic e-commerce markets.

Finally, developed countries' consumers are increasingly aware that in an interconnected world consumer protection properly enforced worldwide benefits them as well.

The revised UN Guidelines call for digital consumers to enjoy "a level of protection not less that afforded other forms of commerce." There are six ways to meet this challenge:

First, consumers require access to high quality and affordable ICT infrastructure. Broadband networks are essential to access digital markets easily, especially mobile.

The divide in digital infrastructure is clear: 93% of Japanese use the internet, while only 22% of the Indonesians do, for example. Broadband speeds are 30 times slower in Africa than in developed markets, and mobile is five times slower.

Secondly, consumer choice must be free from hazards to health and safety: Product recalls must grow global as safety hazards grow global too.

Although today's online consumers can access information on product recalls, the likelihood of hazardous products being offered in multiple jurisdictions has also risen.

ICT platforms should be used for this purpose. For example, MENA and Latin American countries are learning from experiences such as the European Union in terms of regional alarm systems.

Third, Consumers must be guaranteed the right to receive, understand and compare information of goods and services and of businesses:

In an age of rapid transactions, knowing who to trust is all the more important. Online consumers should not have to simply "tick, click and hope for the best."

Quality-assurance seals both mandatory or voluntary - the Better Business Bureau is an example - enhance confidence in digital purchases.

Fourthly, consumers - both younger digital natives and older "non-natives" - need clear understanding of basic e-commerce rights and cybersecurity.

Most countries carry out education campaigns specially targeting online consumers.

We must support these efforts and benchmark best practices in this regard.

Fifth, consumers should have access to expeditious, fair, transparent, inexpensive and accessible online dispute resolution and redress

The Mexican online conciliation mechanism, CONCILIANET, which has addressed more than 5,000 consumer complaints, with 95% satisfied.

But we also need to keep up with changes in the "collaborative economy" which are have a consumer-to-business-to-consumer model, further complicating dispute resolution.

Sixth, consumer privacy must be preserved

Old risks, such as fraud, are exacerbated with new ones, such as online identity theft. EU consumers' top two concerns are misuse of personal data and security of online payments. This concern is common to consumers all around the world.

"Big data" has made possible the commodification of consumers' online behaviour. It is important consumers know, and consent to, such new business practices.

To unleash the full power of the revised UN Guidelines, Member States should review existing consumer protection policies to accommodate electronic commerce.

Some countries (like Mexico and Chile) have opted for encouraging self-regulation of e-commerce, while others have produced sectoral guidelines.

We need coordination among stakeholders, not only between government and the private sector but also among different agencies with a stake in protecting consumer online. This is the case in countries, for example, where one agency deals with consumer protection and another is responsible for online payments.

Cooperation across-borders is also paramount for effective enforcement. The UN guidelines are also explicit on this - particularly because resources and capacities for consumer protection continue to be a major challenge for developing countries.

As the most inclusive global intergovernmental platform, the UN remains crucial for 21st Century consumer protection.

We are proud the General Assembly has entrusted UNCTAD with the mandate to serve as the focal point on consumer protection in the UN family.

Our Intergovernmental Group of Experts (IGE) on Consumer Protection Law and Policy has been at the heart of these efforts, particularly in addressing e-commerce related issues.

UNCTAD Compal, UNCTAD-Asean and UNCTAD-Mena consumer protection networks also provide platforms for sharing experience and capacity building.

A novel initiative is UNCTAD e-trade for all, which will match resources with digital economy needs in developing countries. The e-trade for all online platform will be launched on 25 April at UNCTAD e-commerce week.

And UNCTAD's Manual on Consumer Protection is another important element. The 2016 version has special chapters on e-commerce, privacy and enforcement.

Many thanks to both the Government of Germany and Consumers International for organizing this summit recognizing that empowered consumers are needed for achieving the 2030 Agenda. Your partnership and leadership should be commended and emulated as we our shared work continues.

Thank you.



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