The World Trade Centre, Mumbai hosted a pivotal session on “Empowering MSMEs through Digital Trade” at the prestigious WTO Public Forum 2025, held on September 17-18 in Geneva, Switzerland bringing different voices across the world to underscore the transformative potential of digital technologies in enabling Micro, Small, and Medium Enterprises (MSMEs) to thrive in the global trading ecosystem.

The 36th session, organized under the broader theme of the WTO Forum, “Enhance, Create, and Preserve,” brought together global trade experts, policymakers, technology innovators, and business leaders to deliberate on strategies and best practices to digitally integrate MSMEs into international trade channels. It highlighted challenges faced by MSMEs in accessing digital tools and cross-border markets, while showcasing innovative solutions that can bridge these gaps.

The World Trade Centre, Mumbai was represented by a delegation led by Ms. Priya Pansare, Director- Investment and Trade Promotion. In her introductory remarks, she mentioned about the World Trade Center Mumbai's five-decade legacy since its inception in 1970, operating as India's premier trade promotion and investment facilitation institution under the aegis of World Trade Centres Association (WTCA) which has a global network of over 300 centers across 96 countries.

Opening Remarks

Dr. Senthil Pandian C, Ambassador and Permanent Representative of India to the WTO, delivered the opening address, positioning digital trade as a "powerful catalyst for empowering micro, small and medium enterprises in developing countries and LDCs." He emphasized that digital trade enables MSMEs to overcome traditional barriers and participate more fully in global markets through enhanced market access, operational efficiency, price transparency, and streamlined payment systems. However, he also acknowledged significant challenges including the digital divide, with only 36% of LDC populations having internet access, limited digital infrastructure and literacy, exposure to increased global competition, predatory policies affecting digital platform sales, and concerns around consumer protection and cybersecurity. Despite these challenges, he stressed that embracing digital tools represents not merely an opportunity but a necessity for MSME survival and growth.

Context of the Event

WTC Mumbai invited an expert panel from diverse background- policymaking, NGOs, multilateral bodies, private sector to give an overarching view of the current challenges facing MSMEs and how we can leverage digital technologies to help them thrive. The event, moderated by Ms. Pansare, featured discussions on enhancing productivity and competitiveness, creating cross-border opportunities, and preserving resilience in the face of global economic challenges. While setting the context, she underscored that the role of digital trade is not only supportive but transformative for MSMEs. A short film was also shown capturing the journey of MSMEs in India through digital trade and the vast opportunities it is unlocking for businesses to scale new heights. Further, Ms. Pansare listed challenges like finance and infrastructure which hinder digital trade. Giving an example of how fruit sellers use UPI to transact in India, Ms. Pansare posed a compelling question on why the same practice can’t be used by MSMEs for trade across boundaries.

Ms. Pansare also remarked that the discussion revolves around the theme of the year which is - to enhance productivity and competitiveness, to create opportunities and linkages across borders and to preserve resilience in the face of global shocks for MSMEs. She mentioned examples from India like UPI, National e-Marketplace, amongst others which have revolutionized the way in which MSMEs functions and trade and proves the dictum of prosperity through trade, which is the motto of World Trade Center, Mumbai. The rapid digitalization of trade patterns has helped MSMEs to integrate seamlessly into the global markets. Her experience also emanates from the various initiatives at the World Trade Center, Mumbai like reciprocity desk which digitally connects MSMEs in India with their peers across the globe through World Trade Centers Associations (WTCA). This demonstrates the prowess of digital trade and how it can make significant impact on the MSMEs. With these examples, Ms. Pansare makes a compelling case for using digital trade to empower MSMEs and catalyze growth.

With the opening remarks by Ambassador Pandian and Ms. Pansare in place, the discussion began with Ms. Pansare introducing the panellists and calling them to share their views on how to empower MSMEs through digital trade.

Innovation as the Foundation for Digital Transformation

Dr. Carlos Maria Correa, Executive Director of the South Center, opened the expert presentations by redefining innovation beyond traditional research and development paradigms. He emphasized that innovation for MSMEs primarily involves the incorporation of new ideas, products, or methods that have not been previously used by the enterprise, rather than requiring original technology development. This conceptual framework is crucial for understanding how MSMEs can leverage existing technologies, whether available in the public domain or subject to intellectual property rights, to enhance their operational capabilities.

Dr. Correa presented compelling statistics demonstrating the evolving global innovation landscape, noting that developing countries' participation in global research and development expenditure has dramatically increased from approximately 6% at the end of the last century to 37% currently. However, he cautioned that the top ten research and development funding countries still account for 85% of global expenditures, with low-income economies maintaining negligible participation and about 80% of countries investing less than 1% of GDP in research and development. This reality underscores why developing countries cannot depend solely on their own technology generation but must focus on effectively incorporating technologies available elsewhere.

The innovation framework Dr. Correa presented encompasses four distinct types: product innovation involving new or improved goods, process innovation enhancing production efficiency, business model innovation utilizing tools like e-commerce and subscription models, and market innovation including digital branding and online reach expansion. He emphasized that innovation is vital not only for company growth but often for basic survival, particularly in dynamic sectors where market leadership depends on continuous innovation. His analysis of recent literature on the relationship between digital technology incorporation and small and medium enterprise performance revealed clear advantages including expanded market reach, streamlined business processes, and strengthened customer relationships.

Dr. Correa identified key drivers of digital innovation including entrepreneurship skills, access to finance, government support, customer demands and feedback, supply chain integration requirements, and appropriate regulatory frameworks. He illustrated the importance of regulatory context through a comparative analysis of drone technology development in South Africa versus Nigeria, where regulatory differences significantly impact industry development trajectories. However, he also highlighted persistent challenges including limited finance and resources, skill gaps requiring digital literacy development, regulatory and policy barriers, reliability and quality issues with digital services, and cost barriers, particularly in Africa where one gigabyte of data can cost as high as 8% of average monthly income compared to 1-1.5% in Asia and 2-7% in the Americas.

Drawing from a recent Indonesian study, Dr. Correa noted that nearly 63% of micro, small and medium enterprises currently leverage digital technology to support business operations, though many consumers still prefer traditional transaction methods. Significantly, while the COVID-19 pandemic accelerated digital adoption, many small businesses continue struggling to convert new technologies into sustained performance gains, indicating that technology availability alone does not guarantee successful absorption and implementation. His policy recommendations emphasized government-supported policies and funding, particularly collateral-free loans for companies unable to provide traditional banking guarantees, training and capacity building programs, support from technical research institutions, and the establishment of incubation and innovation hubs.

Dr. Correa concluded by citing India's exemplary approach, identifying seven different national programs and policies specifically designed to support micro and small enterprises, with six operating at the national level and one notable Karnataka state program providing collateral-free loans and capacity building. He noted India's achievement of approximately 10,000 startups as a potential model for other developing countries, emphasizing that even developed countries like Switzerland have established numerous programs to support microenterprises and startups, recognizing that ecosystem support is critical for company growth and survival.

Digital Trade Ecosystem Prerequisites and Implementation Challenges

Dr. Shamika Sirimanne, Senior Adviser to the Secretary General of UNCTAD, provided a comprehensive analysis of the preconditions necessary for MSME success in digital trade and e-commerce. She began by contextualizing the enormous potential of digital trade, citing UNCTAD estimates showing e-commerce sales growth from approximately $17 trillion in 2016 to $27 trillion in 2022, alongside digitally deliverable services now accounting for 55% of global services exports. She emphasized particular opportunities for women entrepreneurs, as digital technologies enable business operations from home while raising families and reduce discrimination compared to traditional brick-and-mortar business environments.

Drawing from UNCTAD's extensive experience working in approximately 50 developing countries over seven to eight years to improve digital economy and e-commerce readiness, Dr. Sirimanne identified six critical lessons and barriers. First, low-quality and expensive connectivity remains a major barrier, with less than half of least developed countries having access to faster 4G networks necessary for digital trade participation, despite broad mobile network coverage. She emphasized that governments must treat ICT connectivity and electricity as critical infrastructure rather than luxury services, particularly given the anticipated pervasive spread of artificial intelligence in coming years.

Second, skills development must extend beyond basic digital device and internet usage to encompass trade-specific competencies including coding skills and cybersecurity features. Dr. Sirimanne noted that technical colleges have proven more cost-effective than universities for providing practical skills, while acknowledging government roles in funding and establishing incubation programs for young entrepreneurs.

Third, financing for MSMEs represents what she termed "truly the elephant in the room." In developing countries, commercial banks predominantly lend to real estate and retail businesses while remaining extremely reluctant to lend to small entrepreneurs, especially women in digital spaces, applying massive risk premiums for digital-related ventures. Success has been observed where governments provide incentives for commercial bank lending or make funding available through development banks and targeted programs, though she criticized current donor funding as "too little and too short-term," emphasizing that effective support requires long-term commitment and on-ground presence.

Fourth, most low-income developing countries lack reliable e-payment systems for cross-border transactions, with much digital trade remaining domestic and operating on cash-on-delivery basis. This limitation severely constrains access to lucrative export markets, with private e-payment platforms sometimes exiting countries where trade volumes are insufficient for commercial viability, creating significant gaps in international market access.

Fifth, countries require strong regulatory environments to establish trust in online transactions, with comprehensive legal frameworks protecting buyers and sellers while safeguarding privacy and preventing cybercrime. Dr. Sirimanne noted that less than half of LDCs and small island developing nations have adopted necessary data protection, privacy and consumer protection legislation, with existing legislation often outdated and poorly enforced. She highlighted successful regional approaches in West Africa and the Pacific, where regional platforms have been created for training regulators, sharing experiences, and peer-reviewing legislation.

Sixth, logistics represents a major barrier as e-commerce customers expect rapid delivery, requiring digitalized customs and trade facilitation systems alongside warehouses and distribution centers positioned closer to consumers. She observed that while several governments have established e-commerce platforms for MSMEs to sell abroad, they find logistics management extremely difficult without affiliation with larger platforms like Amazon and Alibaba.

Dr. Sirimanne emphasized the crucial government role in addressing these barriers, particularly in low-income countries where private sector investment is insufficient. She noted the challenging context of current debt and trade crises but stressed that action is essential as the world proceeds through a technological revolution that will not reverse course and could leave unprepared countries permanently behind. Her analysis of UNCTAD's support for 50 developing countries revealed 77% implementation rates for ICT infrastructure attention and 63% for domestic payment systems, but only 36% for access to finance, indicating significant unfinished business around skills and regulations.

Regarding aid for trade, Dr. Sirimanne criticized the minimal allocation to ICT, representing only 2% of total commitments and 1% of disbursements despite extensive rhetorical support. She advocated critical coordination among donors and development partners to maximize limited fund effectiveness, highlighting successful establishment of national e-commerce platforms modelled on WTO Trade Facilitation Committees to coordinate priorities and present unified requests to donors rather than accepting fragmented, donor-driven approaches.

Practical Implementation and Capacity Building Approaches

Mr. Robert Skidmore, Chief of Sector and Enterprise Competitiveness at the International Trade Center, provided practical insights from his organization's direct work with approximately 35,000 companies annually and broader impact reaching millions of MSMEs. He emphasized the importance of understanding typical MSME realities, describing enterprises with about 20-25 employees, few hundred thousand annual turnover, supply chains, client bases, and critically, single managers responsible for decisions ranging from global strategy to operational details. These managers are extremely busy and overloaded, making digital transformation both a significant opportunity and substantial challenge given the wave of innovation they must navigate.

Mr. Skidmore stressed the need to "meet enterprises where they are" rather than imposing advanced solutions, recognizing that while COVID-19 provided significant impetus for digital thinking, most companies are not yet truly digitally ready. Where digital tools are used, implementation often remains superficial, such as basic websites or simple e-commerce capabilities, without deep integration into operational processes. He emphasized the enormous heterogeneity among MSMEs, from sole proprietors in Sierra Leone lacking device access or operating with slow connections and non-smart devices, to apparel industry companies with 300-400 employees focused on challenges like digital sample exchange to reduce cycle times and overproduction.

For practical digital trade implementation, Mr. Skidmore advocated for broad interpretation beyond e-commerce platforms, encompassing fundamental information exchange on certificates of origin, product categorization for customs, and buyer communication to enhance trade effectiveness. He noted that e-commerce represents a more complicated version of normal trade, requiring good inventory command, sales process management, return handling capabilities, and digital payment processing. In value chains like cocoa, digital trade might involve sustainability information exchange, buyer-seller connections to reduce post-harvest waste, supply chain optimization, and enabling producer digital payments even when other digital engagement is minimal.

Mr. Skidmore emphasized that digital solutions cannot substitute for proper company fundamentals, noting that marketing knowledge, logistics problem-solving, and money management capabilities remain essential, with cash flow management being the primary cause of small business failure. Sometimes digital tools can facilitate fundamental business processes, but they can also raise stakes and increase risk if not properly implemented. He highlighted ecosystem challenges such as cross-border e-payment difficulties stemming from fundamental bank regulation and financial regulatory framework issues that must be addressed regardless of digital versus non-digital approaches.

Using Pacific region examples, he illustrated cost challenges where fantastic products might cost $42 with $87 shipping charges, making total costs $120 and demonstrating that cross-border trade difficulties for small companies exist independent of digital approaches. This reality suggests that domestic digital trade focus may be appropriate and practical for many MSMEs. His approach emphasizes marrying digital capabilities with strong enterprise fundamentals including inventory management, cash management, and customer relationship maintenance.

Regarding capacity building, Mr. Skidmore advocated for comprehensive approaches beyond goods focus to include services companies, where significant digital trade potential exists, particularly for Pacific region examples. He highlighted innovative service solutions such as AI-powered business plan development for company financing in Senegal, demonstrating how small companies in developing countries can help other small companies adopt digital solutions and develop contextually appropriate approaches. He emphasized that successful programs typically involve partnerships rather than government-only solutions, though government plays crucial environmental roles, with optimal approaches combining private sector engagement, government environmental creation, and facilitative coordination.

Mr. Skidmore stressed the need for sector-specific solutions, from agricultural applications using agtech for soil quality and productivity enhancement, to artisanal products from Central America focusing on visual presentation and client connection, tourism applications, freelancer services from locations like Sri Lanka, and artisanal producers in Central Asia where creative fulfilment functions can provide comprehensive services including connection facilitation, quality control, warehousing, logistics, and finance while maintaining commercial sustainability beyond external program presence.

Regulatory Harmonization and Cross-Border Framework Development

Ms. Sylvia Sorescu from the OECD addressed what she characterized as the "least sexy topic" of trade facilitation and border regulatory challenges, while demonstrating their integral connection to broader digital trade regulation. She established the significance of trade facilitation for MSMEs by noting that digital trade represents approximately 25% of world trade, while MSMEs represent about 30% of manufacturing exports in developed countries but only 18% in developing economies, indicating substantial room for improvement in MSME international market access.

Ms. Sorescu demonstrated that trade facilitation matters for MSMEs across four key dimensions paralleling Dr. Correa's innovation framework: efficiency and productivity in moving inputs and exports cost-effectively, competitiveness in accessing new markets and suppliers, adaptation to market changes in dynamic regulatory environments, and survival capabilities as demonstrated during COVID-19 across sectors from agriculture to medical goods where swift border crossing proved critical. Her analysis using OECD trade facilitation indicators showed that modest performance improvements can increase MSME export probability by 3%, while a fully implemented paperless trade framework could increase global exports by 18%, representing powerful opportunities given current MSME export participation levels.

The regulatory development landscape shows positive progress through the WTO Trade Facilitation Agreement, providing common baseline for modernizing customs and border processes, adopting digital tools, and strengthening cooperation across different sectors with varying requirements for agricultural versus manufacturing products. However, significant challenges persist, particularly gaps between regulatory frameworks and practical implementation, which disproportionately affect MSMEs without access to specific border posts or ports. Ms. Sorescu emphasized that trade facilitation policies are increasingly intertwined with broader digital trade regulatory frameworks, tracked through OECD databases including the Digital Services Trade Restrictiveness Index and a newly launched Digital Trade Integration and Openness indicator.

Critical implementation gaps include incomplete enabling frameworks for electronic transactions, though widespread adoption of e-authentication, e-signatures, and e-invoicing has occurred and provisions are increasingly covered in regional trade agreements supporting paperless trading. However, restrictions on electronic payments persist, requiring enhanced attention. Data regulation complexity increasingly impacts trade facilitation effectiveness, with restrictions on personal and non-personal data significantly affecting paperless trade transitions. Additionally, regulatory frameworks for supporting services including postal services, distribution services, and logistics directly impact MSME trading costs and capabilities.

Ms. Sorescu advocated for actionable strategies drawing on comprehensive databases from OECD and other international organizations to measure challenges and track progress, emphasizing that measurement capability is essential for advancement and impact assessment. She noted multiple forums for addressing coordination challenges, including ongoing WTO Trade Facilitation Agreement implementation, WTO e-commerce working program discussions, regional and bilateral initiatives, new digital economy agreements, and private sector initiatives attempting to harmonize paperless trade standards.

As a specific example of successful coordination, Ms. Sorescu highlighted the 2023 G20 High-Level Principles for Digitalization of Trade Documents, developed during India's G20 presidency with OECD as knowledge partner alongside the Indian Institute for Foreign Trade and UNESCAP. These ten principles covering neutrality, security, trust, interoperability, data privacy, reliability, voluntary data sharing, collaboration, scalability, and traceability represent concrete cooperation achievements addressing issues critical for firms of all sizes, particularly MSMEs. She concluded by emphasizing that while digitalization and artificial intelligence offer tremendous opportunities, coordinated efforts are essential to bridge regulatory gaps and avoid fragmentation risks.

Policy Framework Synthesis and Strategic Recommendations

The final discussion addressed fundamental policy questions about global coordination versus localized approaches. Dr. Correa firmly rejected "one-size-fits-all" approaches, advocating for consciousness of different realities between developed and developing countries and divergencies in digital technology development levels within developing countries. He proposed regional approaches as potentially optimal, citing African Union initiatives including artificial intelligence strategies and global compacts specifically contextualized for continental realities. He emphasized that while technologies offer significant promise, they are not "magic tools" requiring ecosystem development and regulatory systems adequate to implementation realities.

Dr. Sirimanne reinforced the imperative for MSME digital embrace, stating there is "no alternative because we are living through a technological revolution of our time" where non-participation will result in complete marginalization. She cited Rwanda as an exemplary case where presidential-level commitment to digitalization created unified government coordination with all ministries reporting progress, demonstrating how top-level alignment enables comprehensive digital ecosystem flourishing. She advocated good practice collection and dissemination, suggesting institutions like World Trade Center Mumbai and its global network could serve as repositories for successful approaches, enabling other countries to replicate effective strategies rather than maintaining fragmented knowledge.

Mr. Skidmore emphasized lessons from COVID-19 showing companies were not digitally ready even among supposedly digital companies, but significant advancement in understanding has occurred. He stressed the importance of deepening digital command within companies and throughout value chains including trade facilitation, while acknowledging that broader resilience questions extend beyond trade and company issues to involve technology regulators and technology firms in addressing redundancy and systemic resilience challenges.

Ms. Sorescu addressed data standards and policy coordination between OECD countries and developing economies like India, Brazil, and China, noting multiple initiative coordination challenges across WTO forums, trade agreements, and new partnership arrangements. She emphasized the G20 digitalization principles achievement as demonstrating concrete cooperation possibilities for addressing coordination gaps while avoiding fragmentation risks.

Stakeholder Engagement and Implementation Perspectives

It included significant audience engagement addressing practical implementation concerns. Questions about chambers of commerce roles elicited recognition of their essential advocacy functions and private sector coordination capabilities in national e-commerce committees, with chambers serving as business voice articulating needs for simplification while forming part of broader ecosystems including institutions with direct small company contact capabilities.

A fundamental challenge raised by audience members emphasized basic prerequisites of markets, finance, and mentoring before considering digital and artificial intelligence sophistication. This perspective stressed that MSMEs require foundational support including market access, financing availability, and mentoring guidance for managers handling production, marketing, advertising, finance, administration, recruitment, and government formalities as "one-person shows." The observation emphasized putting "first things first" rather than pursuing digital sophistication in least developed countries lacking digital trade infrastructure.

Panel responses acknowledged the validity of these fundamental concerns while arguing that digital tools and foundational requirements need not be mutually exclusive. Simple digital tools like websites for international market visibility, digital payment systems already demonstrated in India, and webinar-based mentoring access to expertise unavailable locally were cited as examples of appropriate technology scaling rather than advanced artificial intelligence applications, while emphasizing continued need for infrastructure development and digital divide reduction.

Conclusions and Strategic Imperatives

The discussion concluded with Ms. Pansare’s synthesis emphasizing that digital trade functions not merely as an efficiency tool but as "an engine of inclusive growth, innovation, and resilience." She stressed that while targeted support for MSMEs remains vital, cross-border collaboration is indispensable for ensuring women-led enterprises and vulnerable groups achieve full integration into the global digital economy. The ultimate success framework depends on public-private partnerships and international cooperation creating resilient ecosystems enabling MSME success regardless of size, sector, or geography.

The collective expert consensus established several strategic imperatives for policy development and implementation. First, developing countries face a critical choice point in technological revolution participation, with the digital transformation presenting both unprecedented opportunities and risks of permanent marginalization for non-participating economies and enterprises. Unlike previous technological transitions, this transformation's scope and speed make participation essential rather than optional.

Second, successful implementation requires comprehensive ecosystem approaches addressing infrastructure, skills, financing, regulatory frameworks, and logistics coordination simultaneously rather than pursuing isolated interventions. The complexity of these requirements necessitates sustained commitment and coordination rather than short-term, fragmented approaches.

Third, while universal solutions are inappropriate given developmental diversity, regional coordination frameworks can provide effective approaches respecting local contexts while achieving necessary scale and interoperability. The African Union's continental strategies and G20's digitalization principles demonstrate viable models for such coordination.

Fourth, government roles in creating enabling environments are essential, particularly in low-income countries where private sector investment alone is insufficient. However, optimal approaches combine government environmental creation with private sector engagement and international coordination rather than relying exclusively on any single actor.

Finally, the discussion established that digital transformation for MSMEs represents both a necessity for survival in increasing digital markets and an opportunity for unprecedented growth and global integration. Success requires recognizing both the transformative potential of digital tools and the fundamental importance of basic business, regulatory coherence, and sustained ecosystem support. The path forward demands coordinated commitment to building inclusive digital economies where every MSME has tools and opportunities for success in the digital era, while ensuring no entrepreneur is left behind in the technological transformation and reshaping global commerce.

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