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Dynamics of Bilateral Digital Trade: The Case of a Korea–EU Digital Partnership

Author

Listed:
  • Irina Korgun

    (EU Center, Hankuk University of Foreign Studies, Seoul 02450, Republic of Korea
    The Institute of Economics, Moscow 117218, Russia)

  • Altin Hoti

    (College of Engineering and Technology, American University of Middle East, Kuwait)

Abstract

The rapid growth of digital trade has had a profound impact on global economies, revolutionizing trading practices and facilitating trade expansion. The purpose of this paper is to explore the digital partnership between Korea and the European Union (EU) and its implications for their shared agenda in digital trade to theorize the dynamics of digital trade. A case study method is used to explore trade between Korea and the EU with in-depth descriptive analysis. Digital trade-flow statistics were analyzed to develop the case for Korea and EU digital trade and derive implications for both countries. The findings were generalized by discussing the relevant literature and data from other countries to identify the wider implications. The analysis was focused on the areas of information and communication technology and e-commerce. The findings suggest uncovered trade imbalances, such as Korea’s surplus of ICT goods exports and the EU’s dominant position in online trade. There is an influence of supply chain dynamics, specifically the presence of Korean manufacturers’ production units in countries like Vietnam, and the same dynamics have shaped Korea’s actual place in the supply of ICT goods to the European market. While the digital partnership was established to align regulatory frameworks and foster trust, transparency, and harmonization in the digital domain, it has failed to adequately reflect the importance of digital trade. Although both sides are motivated to collaborate on the harmonization of digital trade rules, there have been instances where the partners’ interests diverge. It is concluded that some political and economic factors may hinder the effectiveness of the digital partnership, unless concrete measures that go beyond traditional bilateral policymaking approaches are implemented. It is therefore recommended to emphasize the need to enhance the efficacy of the digital partnership by taking bolder actions to develop digital trade.

Suggested Citation

  • Irina Korgun & Altin Hoti, 2023. "Dynamics of Bilateral Digital Trade: The Case of a Korea–EU Digital Partnership," Economies, MDPI, vol. 11(10), pages 1-14, October.
    • Handle: RePEc:gam:jecomi:v:11:y:2023:i:10:p:248-:d:1255611
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    References listed on IDEAS

    as
    1. Javier López González & Silvia Sorescu & Pinar Kaynak, 2023. "Of bytes and trade: Quantifying the impact of digitalisation on trade," OECD Trade Policy Papers 273, OECD Publishing.
    2. Mira Burri & Rodrigo Polanco, 2020. "Digital Trade Provisions in Preferential Trade Agreements: Introducing a New Dataset," Journal of International Economic Law, Oxford University Press, vol. 23(1), pages 187-220.
    3. Henry Gao, 2018. "Digital or Trade? The Contrasting Approaches of China and US to Digital Trade," Journal of International Economic Law, Oxford University Press, vol. 21(2), pages 297-321.
    4. Sae Won Chung & Jae-Seung Lee, 2019. "Building the pillars of the EU-South Korea strategic partnership," Asia Europe Journal, Springer, vol. 17(3), pages 327-340, September.
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