Global Digital Governance: Here’s What You Need to Know

Q1: What is “global digital governance”?

A1: Digital and internet technologies are pervasive in modern life and enable the near-limitless generation, storage, and exchange of private data and information. Global digital governance encompasses the norms, institutions, and standards that shape the regulation around the development and use of these technologies. Digital governance has long-term commercial and political implications. Naturally, there is an ongoing contest between democratic and illiberal actors, with each side seeking to impart its vision on the digital economy.

Q2: Is there a historical parallel to governing key economic sectors globally?

A2: Sectors critical to the global economy are subject to international cooperation frameworks and pacts. Therefore, the idea of setting up a single multilateral organization with a mandate to govern the digital economy is not unprecedented. Global aviation has been regulated since 1903 when the International Commission for Air Navigation (ICAN) first met, subsequently replaced by the International Civil Aviation Organization (ICAO) in 1947. Similarly, the modern international banking system is governed by the Bank for International Settlements (BIS), an institution initially set up in the interwar period in 1930 to oversee Germany’s reparations to the Allies under the Treaty of Versailles. The BIS acquired a more global mandate beginning in the 1950s and is now partially responsible for global financial stability.

Q3: Who are the key players in the global contest for digital governance?

A3: While regulations around internet governance and data use are largely formed at the national and (in some cases) sub-national levels, there are currently two visions for the future of digital technologies that could create two distinct models for digital governance.

An authoritarian vision drives the first model. Most notably, China is emerging as the standard-bearer for this model with its desire to “reinvent the internet.” China seeks to champion the concept of “cyber sovereignty,” allowing countries to control access to the internet, censor content, and institute data localization requirements, as a pretext to protecting individual national interests. Politically and economically, the spread of this model around the world (especially among developing countries) could lead to long-term stability and sustainability issues undermining the internet's free, open, and interoperable nature that allows the digital economy to thrive. To achieve this outcome, China has leaned on multilateral processes and institutions like the International Telecommunication Union.

China’s autocratic government uses the advantage of having a substantially large domestic market to develop, test, and institutionalize digital tools that sustain its oppressive regime. Using its bilateral engagement prerogatives, China also exports some of this technology through the Digital Silk Road to undermine freedom and democratic values globally. China has been particularly successful in offering its 5G communications technology as a low-cost model to several low- and lower-middle-income countries with a growing middle class.

The second model is the European Union’s General Data Protection Regulation (GDPR), which provides a more democratic concept for digital governance. This model primarily seeks to protect the privacy and rights of internet users and online content consumers. Adopted with the overwhelming support of the European Parliament in 2014, the GDPR came into effect in May 2018, giving firms that rely on digital technologies the opportunity to modify their data usage and privacy policies. The adoption of the GDPR has been a turning point for global internet governance as consumers gained unprecedented control over their data in a manner that preserved freedom and openness online. The GDPR also bolstered the cybersecurity efforts of firms, guarding them against potential data breaches. Ultimately, the level of compliance required by the GDPR proved to be a powerful way for businesses to increase consumer trust. Critics argue, however, that the GDPR may not be balanced in a way to enable innovation by the private sector. Moreover, the model (while enforceable in Europe) might not be adopted with ease in other parts of the world. This may be most true in the developing world, where countries struggle with state capacity and enforcement challenges.

Q4: How does this affect the United States and its global development policy?

A4: Since it went global in the early 1990s, the internet has served as a democratizing force, making it the single most consequential U.S. cultural export. Although it was never conceived with this intent, the internet today is a crucial instrument within the United States soft-power toolkit, as it is a platform that can facilitate political organization and dissent in the most repressed parts of the world. Absent U.S. commitment to lead the global community in digital governance, regulators in many countries (friends, allies, or competitors) are expanding sovereign control to push their frameworks for privacy, data protection, and digital taxation. These piecemeal efforts to create new standards are making it more likely that the internet becomes fragmented.

With a growing middle class, many developing countries face pressure to adopt policies that facilitate science- and technology-led innovation to generate greater economic growth. These countries also face the option of whether to draw upon the Chinese model or the European model. In other words, they are left with either an authoritarian concept that could pull their societies down an illiberal path or a democratic one that requires intensive use of state resources to the detriment of its nascent (sometimes fragile) private sector. And even if some countries find a middle ground of their own (such as India or Singapore), it only increases the likelihood of internet fragmentation.

Q5: What does all of this mean for the Biden administration?

A5: Given these risks, the United States should recognize the need to institutionalize a digital regulation framework and assume a leadership role that can both serve its strategic interests and harmonize the efforts of various actors across the globe. The United States can use its bilateral relationships and leverage its status as the lead shareholder in various multilateral institutions to galvanize global democracies and create consensus on digital governance principles that would protect a free, open, and interoperable internet.

The Biden administration cannot meaningfully realize these challenging objectives without domestic political support in the United States and the commitment of its allies. In Washington, the administration needs bipartisan support from Congress in the form of legislation codifying the U.S. position on principles of governance around data flow, trust, privacy, and security. Bipartisan support is critical to commitment, consistency, and unity toward global digital governance. As Washington tries to unite on this issue, it should take into confidence its allies and closest partners. Not only would that ensure buy-in on the global stage before the United States attempts to promote the adoption of this model, it would also reaffirm the commitment toward a liberal international order between the United States and its transatlantic and transpacific partners. Achieving these two outcomes is not easy and requires navigating significant ideological chasms and political differences. However, the administration can approach consensus-building through the following four steps:

  1. Develop domestic standards and technologies through private sector partnerships.
  2. Engage multilateral institutions.
  3. Promote governance standards through trade agreements with developing countries.
  4. Facilitate capacity building and strengthening.

To learn more about how these strategies can play out in detail, check out the CSIS policy brief on this subject.

Sundar R. Ramanujam is a research associate with the Project on Prosperity and Development at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Daniel F. Runde is senior vice president, director of the Project on Prosperity and Development, and holds the William A. Schreyer Chair in Global Analysis at CSIS.

Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2021 by the Center for Strategic and International Studies. All rights reserved.

Daniel F. Runde
Senior Vice President; William A. Schreyer Chair; Director, Project on Prosperity and Development

Sundar R. Ramanujam

Research Associate, Project on Prosperity and Development