Conflict and Coordination Between Data Sovereignty and Digital Trade Liberalisation: An Analysis of Cross-Border Data Flow Policies in China and the EU

Abstract

The digital economy faces a fundamental contradiction between the principles of digital trade liberalisation and the emerging demands of data sovereignty. This study analyzes this tension by conducting a comparative examination of the data governance frameworks of China and the European Union (EU). It contrasts China’s state-centric approach with the EU’s human rights-oriented model. The analysis demonstrates how these divergent models create significant non-tariff barriers to digital trade, clashing with the international liberalisation principles. It proposes several pathways for coordination to mitigate this tension. These include philosophical alignment on global justice, perfecting international trade rules with clear security exceptions, and strengthening regulatory cooperation.