TPP Carries Benefits for Pacific-Rim Smart Cities

TPP Carries Benefits for Pacific-Rim Smart Cities

This piece was originally published in the April 2016 issue of ei, the magazine of the electroindustry.

By Craig Updyke, Director, Trade and Commercial Affairs, NEMA


Among the 12 Trans-Pacific Partnership (TPP) member economies,[1] Singapore may be the best known for its ambitions to apply smart-city technologies to improve the wellbeing of its citizens.

According the Infocomm Development Authority of Singapore (IDA), the city-state government’s Smart Nation Platform will enable “greater pervasive connectivity, better situational awareness through data collection, and efficient sharing of collected sensor data.”

Malaysia has plans to transform the Iskandar region (just north of Singapore) into a smart city, while Japan is promoting the purpose-built smart town of Fujisawa and, in part, assessing the results of four smart-city pilot projects that concluded in 2014. In South America, Chile’s capital of Santiago has a smart-city initiative, while the traffic congestion in Lima, Peru, has driven that capital city to a low ranking among its peers.

For its part, the U.S. Department of Transportation’s Smart City Challenge program is soliciting ideas from mid-size communities in this country to demonstrate how advanced data and intelligent transportation systems (ITS) technologies can be used to smooth traffic, promote safety, and protect the environment.

What does a regional trade liberalization agreement have to do with any of these smart-city activities? In summary, many TPP provisions hold the potential to break down barriers, prevent new barriers, promote competition and service delivery, and prepare the ground for even more innovations.

U.S. Trade Representative Michael Froman told the Economic Club of Minnesota on March 7, 2016, that the “TPP is the first trade agreement with rules that take on the issues of the digital economy with a commitment to make the Internet open and free. Rules that make sure that data can flow freely across borders and countries can’t force companies to locate their infrastructure in that country in order to serve that market.”

In summary, smart city-related commitments made by the 12 TPP countries include the liberalization of telecommunications services, promotion of electronic commerce, and enabling of cross-border data flows.

Chapter 13 of the TPP’s legal text, agreed on October 5, 2015, contains commitments related to telecommunications services, which are critical to the delivery of smart-city data and information to individual citizens through smartphone and home-based systems. In part, the chapter facilitates the opening of incumbent carriers’ infrastructure to interconnection by new service providers, promoting the broadening of networks, connectivity, and competition. According to the Office of the U.S. Trade Representative, the chapter also “ensures that regulation is impartial across different technologies, helping to ensure that freedom to innovate is the rule.”

In the area of electronic commerce, the TPP “includes commitments ensuring that companies and consumers can access and move data freely (subject to safeguards, such as for privacy), which will help ensure free flow of the global information and data.”

The agreement also prevents member countries from requiring companies to build physical data centers in every TPP market, conserving resources, securing economies and scale, and optimizing footprint based on business decisions rather than government regulation. The practical utility of these provisions is that, unless subject to potential local government restrictions, the massive amount of data generated by a smart city need not be kept within the boundaries of that city or country in order to be consolidated and analyzed.

Layered on top of these commitments are schedules to eliminate customs duties on imports of smart city technologies from TPP countries. If approved by Congress, the TPP stands to help U.S. companies compete to provide the future.

[1] Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, United States, and Vietnam

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