allowing its own industries to prey on the more liberal e-commerce market access of
other countries at the same time. Unlike traditional trade barriers, which are generally
applied directly to the object of the transaction (goods or services), the protectionist
measures used in the digital era of today often come in the form of government
interventions in the cross-border data ﬂow by, for example, the imposition of internet
censorship or cross-border data ﬂow restrictions.
China is the most prominent exponent of this so-calleddigital mercantilism. As observed
by The Economist magazine:
China is a sort of technological Galapagos Islands; a distinct and isolated environment in which
local ﬁrms ﬂourish. Chinese ﬁrms are protected from external competition by government
regulation and the Great Firewall. And that protection means that they need not innovate but can
thrive by copying business models developed in the West (The Economist, 2016).
For long, China has been the best case study in the relevant researches(Wu, 2006;Aaronson,
Rather than attempting here to give an overview of the full range of China’s digital
mercantilistpolicies, this paper will focuson one subtle –but g reatly inﬂuential constitue nt –
internet connection speeds. There isno doubt that a long Web page loading time drives the
visitors away.For example, according to Google’ssurvey, 53 per cent of visitsare abandoned
if a mobile site takes longer than 3 s to load (Google, 2016). Other data show that when the
page loadingtime goes up from 1 s to 10 s, the probabilityof a mobile site visitor “bouncing”
(enteringthe site and then leaving) increases by 123 per cent(An, 201 7).
Our empirical data show that, as a general rule, Chinese consumers need to wait much
longer to connect to foreign websites(if the connections are not bluntly blocked) than foreign
consumers to connect to Chinese ones. These two-way asymmetrical internet speeds are
caused by China’s censorshipof cross-border data ﬂows, also known as “the Great Firewall”
(GFW). Very little of the literature on the subject discussesChina’s low internet speeds in the
context of trade. In our view, this is another ﬁrm evidence of Chinese digital mercantilist
Following this introduction,we proceed to present the current and projected market data
that demonstrate the signiﬁcant advantages already gained by China in the area of e-
commerce. The next section contains a short description of how China’s digital mercantilist
policy works. This is followed by empirical data of the asymmetrical internet connection
speeds within China, showing that even when not being blocked, foreign e-commerce
businesses can hardly compete in the Chinese market. Finally,we explain why the existing
World Trade Organization (WTO) rules cannot effectively address these unfair practices.
We conclude by adding our observations of the ongoing WTO plurilateral e-commerce
negotiation and by suggestingthat a provision guaranteeing the free ﬂow of data should be
included in the outcome agreement.
Before going further, we think it might be useful to clarify in advance some of the
terminology that we use in the paper. First, we use the terms “e-commerce”and “digital
trade”interchangeably. Both these terms refer to their broadest meaning, “any
transaction occurring online”, and their scope includes transactions in goods, services
and digital content. The same logic applies to the terms “information”and “data”.
Although some authors tend to consider that they each refer to different concepts
(Aaronson, 2019), we do not make such a distinction here. In this paper, “data-ﬂow”
and “transmission of information”both refer to the “transmission of electronic signals
via the internet”. This includes any online communication and transfer of transactional
or personal data.