Outlining the Government's consumer-related interests in Electronic Commerce

The Electronic Consumer Conference
Parkroyal Hotel
Wellington

Chair, overseas guests, ladies and gentlemen. I am delighted to be here today to outline the Government's consumer-related interests in Electronic Commerce.

As most of you will have heard, I attended the OECD International Forum "Gateways to the Global Market: Consumers and Electronic Commerce" in Paris a fortnight ago.

If you've picked up a newspaper or turned on the radio, you could follow the hot debate. If I had gone to Kathmandu in sack cloth and ashes and stayed in a backpacker hostel, I believe I could have been away 5 weeks at the taxpayers expense and not received the comment I did.

It would not have served your needs, but I would not have flown first class to do it. Such is politics - on to the Internet.

We have always used or found ways of bringing ourselves closer to the rest of the world - whether they be first class or over the telephone.

New Zealanders take to new technology like ducks to water, and I believe that this desire to take it on board so quickly reflects our geographical isolation and the difficulties such isolation itself causes.

The Age of Technology is having enormous impact on our lives from the way business transactions are carried out to the way each one of us undertakes daily tasks.

It never ceases to amaze me, how many New Zealanders ranging from our senior citizens to our very young, see technology as a way of life. The difference is even more marked when we compare the level of technology use today, to that of even two-three years ago.

It is also wonderful because it means many more opportunities and experiences for us.

I was intrigued last week, to see commentators describe the OECD International Forum as a forum on "Internet shopping". This rather simplistic notion belies the reality of the world we live in, and reveals a lack of understanding of the global concept.

I see electronic commerce as a critical aspect to New Zealand's economic development - the potential is enormous for businesses to successfully use computer technology to their advantage.

Not only in terms of immediate access to a global marketplace, but also our ability to promote our products internationally.

Electronic commerce is not just about the consumer, it is about business and whether we like it or not, the Internet is the new way of business exchanges, and is revolutionising the way we do business in this country with the world.

The reality too, is that the pace of change is so fast, that applications and systems become obsolete before they have been fully utilised by the users.

I believe it has been said that the cyber year lasts two and a half months, such is the rapidness of computer technology advances.

Add to that, the fact that by the year 2010, it is anticipated that computing power is expected to be 250 times greater than what we computer users enjoy today.

That expectation is incredible but I do believe it will be achieved, for the simple reason, that so many of the earlier expectations of computer usage have been well and truly exceeded.

I was interested to learn in New Zealand, of a United States company using skilled New Zealand personnel to undertake work during what would be the United States evening and have it completed and sent via the e-mail in time for the start of the United States working day.

This example shows that there could be enormous benefit to New Zealanders through additional job opportunities created via computer technology.

In Australia, I understand that the Australian Government is establishing an "Internet-Based Commonwealth Electronic Commerce Service" over the next two years. It is aiming to enable electronic commerce transactions to operate across both government and industry sectors.

David Jull, the Australian Minister for Administrative Services is reported as saying that the system was designed specifically for small businesses to provide "low-cost, easy entry to electronic trading and to compete for a fair share of government work."

It is because of the rapid change and use of technology, and the ease and enthusiasm with which New Zealanders take up such opportunities, that I see an urgent need to address critical issues, such as consumer-protection.

In the same process, businesses too, will need some form of protection as will New Zealanders undertaking work via the Internet.

Our legislative programme is always a slow process, particularly if it is not seen as a priority.

But in this instance, the knowledge I gained from attending the OECD international forum is that if we do not anticipate potential problems from the wider use of computers across-borders, then we will indeed fall well behind the rest of the world.

New Zealand has for many years, had a catch cry of "being the first" to take on new ideas and opportunities, economically and socially. It is up to Government not to put on the blinkers and ignore the realities of a changing technological world.

I want to see New Zealand drive a response to these potential difficulties, after all, we have gained a positive reputation in consumer-protection legislation - we are considered world leaders in that area.

Considering the problems two years on as they arise, will be too late for both our business community and our consumers. It will end up costing us economically and through employment opportunities.

The OECD forum included key businesses and policy makers looking at the key issues we need to address to ensure that there is one consistent and unified approach.

These issues include, data protection, consumer privacy, dealing with cross-border fraud and the issue that raised its head last week, in New Zealand of pyramid selling on the Internet.

Well, we have our own guidelines and regulations regarding pyramid selling, but what about on the international scene?

Without international co-operation, we may see an unfortunate side-effect of computer usage - that of scams taking thousands of dollars away from New Zealanders.

There are already calls in this country for protective legislation. I note the recent comments made by Derek Johnston, a Russell McVeagh partner, who has recently raised the issue that in his view, New Zealand laws do not adequately protect New Zealanders buying or selling via the Internet.

He said that "Internet fraud is a very real risk which will grow in intensity as more people use the Internet to conduct their business and personal affairs."

I totally agree, and my Ministry is already acting on the issue of Internet commerce and that is also what this conference is about.

I also see it as imperative that we find an international solution. My attendance at the OECD forum was to take a lead on behalf of all New Zealanders, by actively promoting an International Code of Conduct, and emphasising the urgency of the situation.

The sooner we start understanding the truly international nature of the issues consumers and businesses will face, which transcend national boundaries and severely challenge traditional governmental approaches to market problems, the better standing and placement for the New Zealand consumer and business.

I gained a considerable insight from discussing the issues with forum participants, and as a result, I will be well placed to identify what needs to be done in this country and seek the support of my parliamentary colleagues.

Identifying what needs to be done is no easy task. It may or may not require changes to legislation in New Zealand, it will require some sort of international agreements involving government agencies such as an International Code of Conduct which I have already called for.

It is no good looking at the issues two years down the track when the problems are very much in evidence and requiring an urgent solution. I firmly believe we must act sooner rather than later.

I believe too that my Ministry will need to undertake extensive consultation with industry experts, users and on the international level, and that process itself will take a little time.

There is an old Chinese saying - May you live in interesting times - our Government more than most understands that, but we do live in an exciting time, and I hope that we will be recognised as a government that is pro-active in its response to the increasing use of electronic commerce.

The next two days will be very interesting for you all, and I know that there will be some very useful and invigorating debate.

I hope you will all gain useful information which can further add value to electronic commerce as an everyday tool for businesses and consumers in New Zealand.