The World Trade Organization recently predicted global trade growth will slow sharply next year, and the World Bank believes that declining growth rates will undermine efforts to reduce poverty. Meanwhile, inflation, high energy prices and fiscal pressures are in focus for policymakers everywhere.

Against this gloomy backdrop, one area that remains a source of optimism is the potential for digital transformation to jumpstart economic growth and create new opportunities — particularly for micro-, small- and medium-sized enterprises (MSMEs) who often are most vulnerable to economic downturns. As more people and businesses come online, particularly in emerging markets, the internet continues to create new opportunities for businesses to export and grow.

A report that we’re launching today gives us a sense of the scale of the opportunity, estimating that the right investments in digital transformation can boost the exports of six Latin American countries up to $140 billion annually, by 2030 – a four-fold increase over current levels.

“The Digital Sprinters”

Today’s report builds on our 2020 Digital Sprinters framework, which offered a blueprint for how emerging economies can accelerate their digital transformation with investments in four key areas:

• Infrastructure: Investing in digital connectivity and secure and environmentally sustainable infrastructure, including smart management.
• People: Preparing people across all communities for the jobs of the future by helping to skill and train them for the digital economy.
• Technological innovation: Deploying technological innovation that can unlock new opportunities. Increasing the use of data, artificial intelligence, and cloud computing, to create efficiencies and enable economic growth.
• Public policies: Creating a predictable regulatory ecosystem that promotes competitiveness, open markets, interoperable regulatory standards, and tax regimes based on international standards.

Digital Exports in Latin America

To assess the potential for Latin America, we commissioned new research to better understand digital exports and their potential to impact six economies in the region. The results are noteworthy. Overall, researchers projected digital exports to contribute more than 2% of GDP for Argentina, Brazil, Chile, Colombia, Mexico and Uruguay by 2030, or approximately $140 billion per year – an increase from the current $34 billion, or 0.8% of GDP.

The research identifies three ways in which the digitization is changing trade in Latin America:

• Easier access to new markets. The lion’s share of current and potential economic gains come from digital tools that facilitate access to overseas markets, making it easier to sell abroad. What previously required heavy upfront investment and navigating complex bureaucratic processes can today be handled online, often on a smartphone or tablet. Over 60% of economic growth is fuelled by tools like online ads, which are regularly served to consumers abroad. Cloud services are another driver of digital exports, enabled by new infrastructure investments in the region, like Google’s “Cloud Regions” in Santiago, Chile, and São Paulo, Brazil.
• New products. The second area, making up over a third of expected gains, are exports of a growing array of new digital products and services. Think of mobile apps that find a global audience through the Play Store or other platforms. More than 2.5 billion people in over 190 countries use Google Play every month. And more than 2 million developers work with us to build their businesses and reach people around the globe. Video streaming is another example where content produced in one country can easily be exported. Paying out over $6 billion to content creators between 2021 and 2022, YouTube is enabling content and culture to transcend borders.
• Digitization of trade procedures. A third area that is contributing to export growth is the overall digitalization of trade processes. Think paperless procedures at the border or in ports, email or online forms instead of phone calls, or Cloud computing or artificial intelligence technologies to simplify formerly complex trade machinery while shrinking the cost. Google Translate supports more than 100 languages, it can translate entire websites, scanned documents or pictures, enabling seamless communication across borders. While not counted in overall estimates, digitalization of trade would bring additional efficiencies to trade balances.

A big opportunity for small businesses

Leveraging digitization for exports is already taking place today. For example, Doris Canseco opened a traditional flower shop in Mexico, but the limited local market led her to move online. Using Google Ads to get the word out about her business, Flores de Oaxaca's customers in Europe, the United States and Canada, among other places. The business doubled in size and today online sales account for between 60 and 85 percent of its total revenue.

Similarly, Germán Garmendia was born in the small town of Copiapó, in the Atacama desert in Chile. A shy and quiet child, his mother signed him up for drama classes. A few years later, Germán started posting videos online. Today, he is one of the world’s most popular YouTubers, with more than 43 million subscribers on HolaSoyGerman and 46 million on JuegaGerman, and has used the platform to break into other fields.

Doris’ and Germán’s stories reflect a broader trend in Latin America and beyond, where digital tools are democratizing access to the global economy and creating new opportunities that didn’t exist a generation ago. The new report suggests that governments, together with the private sector and civil society, should adopt policies and invest to reinforce this trend.

Compelling data for governments and policymakers

The report looked at how policymakers can unlock export opportunities in a way that is inclusive and sustainable. Based on prior experience across Latin America, they identified 11 recommendations across five areas, which are aligned with the Digital Sprinters framework: — (1) lead from the top, (2) build physical capital, (3) develop human capital, (4) enhance competitiveness, and (5) enable technology usage. While progress and priorities vary among countries, the most common recommendations involve boosting digital infrastructure, digital skilling, digital security and policies that promote trade.

How Google is supporting economic inclusivity through exports

The report estimates that Google's digital products enabled 13% of the export growth across these economies in 2021. We are proud of this contribution and look forward to supporting future growth. We’re also committed to supporting entrepreneurship and skills development across the region.

When we opened our Google for Startups campus in Brazil in 2016, there were no “unicorns” — startups valued at $1 billion or more – in the region. Today, there are 35, including 13 that have been part of our Google for Startups programs. Many of these startups develop digital exports, provide their services across borders, and help traditional small businesses to grow. With investment, resources and training from Google, we have supported more than 450 startups in the region. These startups have gone on to raise more than $9 billion in investments while creating 25,000 jobs.

We’re also supporting digital skills—like cross-border marketing online — which are key to unlocking opportunities for entrepreneurs. Through our Grow with Google program and Google.org grantees, we’ve trained nearly eight million people across Latin America in digital skills since 2017. To build on this momentum, we’ve recently announced that we’ll provide Google Career Certificate scholarships to train one million more people in Latin America — opening paths to well-paying jobs in high-growth fields.

Next Steps

At a time of global macroeconomic uncertainty, it is more important than ever to double down on digitally-led trade growth . We hope this research we are releasing today sheds further light on the opportunities and policies needed to achieve them —and helps communities and policymakers in Latin America as they seek to harness digital transformation to become Digital Sprinters.

This week world leaders gathered in New York City for the United Nations General Assembly (UNGA). Google participated in a range of UNGA-related engagements as part of our commitment to collaborate with international organizations to achieve collective solutions to the world’s most pressing challenges. Here are just a few of the many topics we covered:

Global governance in a digital era

The global internet was built to be a shared resource that everyone could access wherever they lived — but over the last few years this ideal has been increasingly challenged. Regulatory barriers to the free flow of information across borders are threatening to fragment the internet. New and revitalized global governance frameworks are needed for an increasingly digitized world, and international organizations will be critical to achieving them, which is why we support the UN Global Digital Compact.

Over the course of this week, we had various conversations about what needs to be done to ensure that the internet remains open, secure and reliable for everyone. Preserving the cross-border availability of secure technologies and digital services – coupled with forward-looking decisions by governments to invest in digital infrastructure and digital skilling – can protect access to information everywhere and ensure that the benefits resulting from the global internet are preserved.

Supporting the UN Sustainable Development Goals

Progress on the UN Sustainable Development Goals (SDGs) was a key topic during this week’s UNGA. The 17 UN SDGs were created “to make a better world for everyone, now and into the future.” They include goals like achieving gender equality, ensuring quality education and tackling economic inequality. At Google, we see countless ways in which technology can help accelerate progress on these goals.

While the global community has made some important progress in meeting the SDGs since they were launched in 2015, headwinds persist due to Covid-19 and global conflict and, unfortunately, not a single country is on track to meet all 17 goals by 2030. To that end, Google's philanthropic arm, Google.org recently announced that we are expanding these efforts through a $25 million commitment to support NGOs and social enterprises using artificial intelligence (AI) to accelerate progress in achieving the SDGs.

A number of the SDGs – ensuring sustainable cities, and access to affordable and clean energy, for example – were established with sustainability top of mind. And as our CEO has said before, solving climate change is humanity’s next big moonshot. Working together, governments, companies, and citizens can create technology-enabled, scalable solutions that deliver a prosperous, carbon-free future for all of humanity.

As a company we've been carbon neutral since 2007, and by 2030 we aim to achieve net zero emissions across our operations and value chain, and to run our data centers and offices entirely on carbon-free energy. As we work towards these goals, we’re collaborating with partners to share tools and resources to make clean energy achievable for all, such as the 24/7 Carbon-Free Energy Hub and Academy launched earlier this week. And we continue to partner with UN Energy, Sustainable Energy for All, and dozens of companies and cities around the world to grow the 24/7 Carbon-Free Energy Compact.

Ukraine

The war in Ukraine continues to be both a tragedy and a humanitarian disaster. Since the war broke out, our team has worked around the clock to combat disinformation, elevate authoritative content across our services, protect cybersecurity in Ukraine and globally, while also providing humanitarian assistance and supporting the region more broadly. This week, we were honored that Sundar was selected as a recipient of one of this year’s Atlantic Council Global Citizen Awards, in recognition of Google’s efforts in response to Russia’s continuing war in Ukraine, our commitment to digital resilience, and our ongoing support for refugees and displaced people throughout the world.

International organizations like the United Nations are unique in their ability to convene countries from all over the world, and we are pleased to collaborate closely with member governments to play our part.

The global internet began with an incredible promise: a shared resource that everyone could access wherever they lived. Over the last few years, this ideal has been strained to the breaking point as governments around the world have adopted conflicting regulations that are fragmenting the internet to the detriment of people everywhere.

That’s why it’s great to see countries coming together today to launch the Declaration for the Future of the Internet (DFI). Through this effort, allies across the public and private sectors will work together to protect the importance of the global web, including by opposing shutdowns and other “efforts to splinter the global Internet.”

Digital fragmentation impacts everyone using the internet. As conflicting regulations proliferate, people’s access to content, privacy protections, and freedom to transact and communicate increasingly vary depending on where they are located. Digital fragmentation has become a significant barrier to international trade, with a particularly pernicious effect on small businesses, which lack the resources to navigate an array of conflicting rules. And it discriminates against smaller, developing countries, as new products become harder to launch and scale on a fragmented Internet to all markets.

The DFI provides a path to address the most urgent threats to the global internet. In particular, we’re seeing a number of governments take actions to crack down on the free flow of information and ideas, increase government surveillance, and restrict access to cross-border internet services under the banner of “cyber-sovereignty.”

The DFI joins the EU-US Trade & Tech Council and the Indo-Pacific Economic Framework as important fora where like-minded partners can join together to address cross-border challenges. We hope this work will be grounded in a few key principles:

• First, governments should strive to agree on common standards to guide the development of new rules for digital technologies, so that consumers have consistent protections across borders and access to digital tools.
• Second, governments should strive to increase interoperability between national digital rules, as we’ve seen with the US-EU Data Privacy Framework.
• Third, governments should commit to intergovernmental regulatory dialogue to ensure that new rules strengthen shared values.
• And fourth, governments should abide by core open trade principles like non-discriminatory approaches to regulation that don’t single out foreign companies.

The private sector also plays an important role in maintaining the global internet. That’s especially true in times of crisis, as security teams work to disrupt disinformation campaigns, cyber attacks and other online threats. Since Russia’s invasion in Ukraine, our teams have been working around the clock to support people in Ukraine through our products, defend against cybersecurity threats, and surface high-quality, reliable information. We are committed to partnering with governments and civil society through the Declaration to disrupt disinformation campaigns and foreign malign activity, while ensuring people around the world are able to access trustworthy information.

Ultimately, the cross-border availability of secure technologies and digital services – coupled with forward-looking decisions by governments – can protect access to information everywhere and ensure that the enormous benefits resulting from the global internet are not lost. We stand ready to support the DFI’s mission to promote an open, secure, and reliable internet for all.

We commend the European Commission and U.S. government on the work they’ve done to reach a new Trans-Atlantic Data Privacy Framework.

People want to be able to use digital services from anywhere in the world and know that their privacy is respected, and their information safe and protected. This agreement acknowledges that reality: it commits the parties to a high standard of data protection while establishing a reliable and durable foundation for the future of internet services on both sides of the Atlantic.

A meaningful agreement

The work to get to this stage was anything but trivial, and required addressing important considerations of both national security and individual privacy. Google has long advocated reasonable limits on government surveillance. The U.S. government has now committed to systems that will enable independent and meaningful redress for people in the EU, strengthen the guardrails and proportionality of U.S. intelligence collection, and ensure effective oversight of these new privacy and civil liberties standards in ways that address the concerns articulated by the Court of Justice of the European Union.

Citizens expect these safeguards from democratically elected governments, even as they understand the importance of protecting people from national security threats.

Building for the long term

People rely more than ever before on the global exchange of information in their daily lives. Everything from online shopping and travel to business operations and security depends on data flows across borders. The Framework guarantees that the tools and services people in the EU use every day will remain available, even while being held to the highest standards of privacy and data protection.

We look forward to certifying our processes under the Trans-Atlantic Data Privacy Framework at the first opportunity. For Google, these (and similar) standards serve as a floor, not a ceiling, for the protections we offer our users and customers. We already help our customers meet stringent data protection requirements by offering industry-leading technical controls, contractual commitments, and resources for risk assessment, and we have long offered leading data access and control tools to our users. Our investment in that work continues to grow.

Sustaining transatlantic cooperation

The Framework shows that it is possible to take difficult steps to reinforce transatlantic cooperation and address emerging security and information threats. This urgency should carry over to enacting a robust new U.S. federal privacy law to align with international standards and enhance trust and confidence in digital services.

For similar reasons, we called eight months ago for the creation of the Transatlantic Trade & Technology Council (TTC) to enable the kind of bilateral coordination necessary to get ahead of future challenges and ensure that the U.S. and EU avoid discordant or discriminatory approaches. We were encouraged by the creation of the TTC and its commitment to avoiding unnecessary barriers to technological trade. There is now a need for progress in other areas of transatlantic divergence, from online content to taxation to competition to supply chains.

The importance of safe, resilient distributed computing in the face of war and autocracy makes this work even more urgent. As the TTC prepares for its next meeting, it is more important than ever that it carry forward the lessons of the Trans-Atlantic Data Privacy Framework to promote a durable digital partnership.