Bridging the digital divide through e-Residency
In recent years, the power of digitization in international trade to enable sustainable development has been much touted. However, beyond the rhetoric, small businesses and entrepreneurs, particularly in developing countries, still find it difficult to take advantage of the opportunities for trading online. Barriers to accessing finance for trade and efficient delivery services, together with the lack of regulations to govern the flow of data and goods, among others, preclude small businesses from entering large consumer markets.
Firms in developing countries, as well as least developed and land-locked economies, can greatly benefit from accessing the global market if the regulatory frameworks and infrastructure to enable their growth are set in place and enforced.
Even when it comes to trade in physical goods, trade facilitation needs to be aided by digitization to overcome geographical constraints; it is not about pursuing innovation for its own sake, but about skillful implementation of policies that can enable seamless adoption of digital technologies.
How, then, can we assist countries in bridging the digital and knowledge divide in order to establish a robust environment for both domestic and cross-border online trade to flourish?
One example is the e-Residency programme, which operates based on the premise of open digital borders. The programme helps people to benefit from the trust and regulatory frameworks of the European Union, regardless of place of residence or where they were born. Anyone in the world who owns a passport can apply in just a few minutes to become an e-resident of Estonia. As 99 per cent of the services offered by the Estonian Government are available online, by becoming an e-resident people gain the right to use many of these e-services as if they were Estonian citizens.
The main value of e-Residency is granting the ability to remotely establish a company and manage it online from anywhere in the world. Most people choose to apply for e-Residency to gain access to financial services that they could not normally access because of their location. For example, by having a company in Estonia, with a European digital business payment account linked to it, businesses and entrepreneurs can benefit from an enabling and affordable business environment. For instance, they can access international payment services providers and apply for funding otherwise reserved to European residents. As of today, almost 35,000 people from 154 countries have applied to become e-residents, and 20 per cent of e-Residency companies that have been established in Estonia come from the Asia-Pacific region.
Geographical location continues to be a huge deterrent to conduct business, but innovations like e-Residency make it easier for entrepreneurs in every country to succeed in the global market. People now have the opportunity to become active players in the growth of their countries’ economies, while digitally accessing state-of-the-art financial and public services.
Governments in the Asia-Pacific region can work on addressing their infrastructural and regulatory needs, while their citizens benefit from entering the global market by remotely using the platform of the European Union.