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The trade and investment flows of Asia-Pacific economies have recovered in the past two years, a time when the region also experienced a wave of digital transformation. This report starts from the notion that good policies are essential for supporting continued digitization and growth of digital trade in the region. The report analyses the current digital trade and investment policy environment in the Asia-Pacific region, and it identifies ways to promote trade through enhanced regulatory cooperation on digital policy issues among Asia-Pacific economies and with extra-regional partners. The report pays particular attention to policies conducive to the regional digital economy, participation of micro, small and medium enterprises (MSMEs) in cross-border e-commerce, and inclusive and sustainable development – policies that will ultimately promote the attainment of sustainable development goals (SDGs) in the region.

The report leverages two new important data products produced by the Economic and Social Commission for Asia and the Pacific (ESCAP) to analyse the region’s digital economy and digital policy frameworks: (a) the Digital and Sustainable Regional Integration Index (DigiSRII) that gauges the state of the regional digital economy; and (b) ESCAP’s Regional Digital Trade Integration Index (RDTII) that assesses the regional policy environment for digital trade and investment. The report also uses the Organisation for Economic Co-operation and Development ‘s (OECD) Digital Services Trade Restrictiveness Index (STRI) to analyse the restrictiveness of policies and regulations that shape the region’s digital development as well as data developed with the support of the United States Agency for International Development on policies conducive to MSME e-commerce.