Trust is an Economic Imperative in the Digital Age

by | Jul 1, 2022

Healthy economies rely on the free-flow of goods and services, guided by the “invisible hand” of self-interest, in trade for assets. This principle holds in micro-economic contexts as well as macro. And in this age of electronic commerce, information plays a key role in how individuals, organizations, and nations participate in the creation and exchange of wealth. This was a central issue in a recent summit between the world’s first and tenth ranked economies, the U.S. and South Korea.

At the end of May, a delegation led by President Joe Biden met with their South Korean counterparts, including President Yoon Suk Yeol, to discuss trade agreements between the two countries. As reported by The Diplomat, a key item on the agenda was the Declaration for the Future of the Internet, an agreement between the United States and more than 50 other countries. South Korea is not a signatory to the pact, which seeks to establish a common set of rules for the operation and protection of an, “open, free, global, interoperable, reliable, and secure Internet.”

Minimizing Digital Friction

Maintaining a global, digital infrastructure that ensures a secure and level playing field for digital free trade is important for established and emerging economies. Recognizing that access to the global market with a minimum of digital friction is in its best economic interests, South Korea has pledged to add its name to the Declaration.

Over the last half-century, South Korea’s economy has enjoyed rapid growth, transforming from an impoverished, undeveloped, largely agrarian society ravaged by decades of war, to a bustling, high-growth, mixed modern economy known for high quality electronics, technology, automobiles, appliances, and heavy equipment. But South Korea is troubled by a reputation as, if not a haven for certain types of digital crime, a place where unsavory activities are not aggressively prosecuted.

A recent Korea Herald editorial bemoaned the fact that, while South Korea is “well known for its advanced internet infrastructure that allows for fast and reliable broadband-based services… its internet regulations are neither sophisticated nor trustworthy.”

Keeping Pace with Regulations

To keep pace in a world where compliance with cybersecurity and data privacy laws is vital to trust and confidence, South Korea must balance its light regulatory touch with the need to ensure trading partners can safely share sensitive data, while also conforming to regulations elsewhere that apply to cross-border data transfers. We believe that South Korea will see the benefit of adopting the guidelines articulated in the Declaration for the Future of the Internet and, beyond agreeing in principle, soon add its name to the pledge.

As a company whose business is predicated on providing tools for ensuring the secure and reliable transfer of data from point-to-point, we understand the value in keeping data safe in transit when transacting business digitally. Our customers depend on the Diplomat MFT secure managed file transfer platform to maintain trust with their customers and partners. When there is a lack of trust, customers will find an alternative. That is a risk no company—or nation—should be willing to take.

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