Global Tech and Trade Policy Update

Global Tech and Trade Policy Update

Hello from this year's WTO Public Forum in Geneva, where the largest business delegation I have ever seen is in town to advocate for the rules-based international system. Nothing like a threat to what you took for granted to drive up panic and action, is it?

Trump's State Visit and a Flurry of Tech Investment

President Donald Trump's second state visit to Britain this week coincided with major announcements from U.S. tech companies, who unveiled £31 billion in new investments in the UK.

Highlights include:

• Stargate UK - OpenAI, Nscale and Nvidia will roll out a U.K. version of the massive AI infrastructure scheme. The first data centres will be built in Northumberland on the site of a former coal power station, creating an "AI Growth Zone" with links to Newcastle University and 5,000 new jobs.
• Nvidia GPUs - Up to 120,000 chips will be shipped to British data centres, half of them to Nscale's project with Microsoft in Essex, where 23,000 GPUs will power Britain's largest AI supercomputer.
• Microsoft - £22 billion over four years, half for AI infrastructure and half for operations including AI model development and gaming.
• Google - Opened a new data centre in Hertfordshire and pledged £5 billion investment over the next two years.
• CoreWeave - £1.5 billion for renewable-powered data centres in Scotland.
• Scale AI - £39 million for London HQ expansion, quadrupling staff.
• BlackRock - £500 million for UK data centres.
• Oracle - Reaffirmed a $5 billion commitment.

All this sets the stage for Thursday's Technology Prosperity Deal between the U.S. and UK, covering AI, quantum, space and nuclear energy.

WTO Public Forum: Spotlight on Digital Trade and AI

Geneva this week has been buzzing with discussions on digital trade, AI and the future of the rules-based system.

• Members and business groups are pushing for a continuation - or permanentisation - of the e-commerce moratorium at the next WTO Ministerial in Cameroon.
• Creative thinking is also emerging around how to implement the Joint Statement Initiative (JSI) on e-commerce within WTO rules, with an eye toward making progress despite broader multilateral challenges.

WTO World Trade Report: AI as Double-Edged Sword

The WTO's annual World Trade Report puts AI center stage this year, projecting that the technology could boost global trade in goods and services by nearly 40% by 2040 - but also deepen divides.

Key findings:

• Trade growth: AI could add 34-37% to trade and 12-13% to GDP globally by 2040, with biggest gains in digitally-deliverable services.
• Distributional impacts: High-income countries see a 14% income boost vs. 8% in low-income countries, unless digital infrastructure gaps close.
• Labour effects: Wage gaps between high- and low-skilled workers may narrow, but displacement risks loom, especially in service-exporting lower-income economies.
• Business adoption: 90% of firms using AI report tangible trade benefits.
• AI-enabling goods: Global trade in semiconductors, inputs and raw materials hit $2.3 trillion in 2023.

The report suggests WTO members explore updates to the General Agreement on Trade in Services and expansion of the Information Technology Agreement.

A New Alliance of Small and Medium-Sized Countries

Against the backdrop of global trade turmoil, 14 small and medium-sized countries launched the Future of Investment and Trade Partnership this week.

Members include Brunei, Chile, Costa Rica, Iceland, Liechtenstein, Morocco, New Zealand, Norway, Panama, Rwanda, Singapore, Switzerland, the UAE and Uruguay.

The group's founding declaration emphasizes open and fair trade and adherence to the rules-based system.

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