THE CURRENT SERVICES ROUND
This presentation is the property of its rightful owner.
Sponsored Links
1 / 30

THE CURRENT SERVICES ROUND PowerPoint PPT Presentation


  • 43 Views
  • Uploaded on
  • Presentation posted in: General

THE CURRENT SERVICES ROUND. Services: General perception. NOT TRADABLE AND NOT STORABLE Simultaneity of production and consumption Role of local establishment STRONG GOVERNMENT INVOLVEMENT Existence of natural monopolies, public service obligations, etc.

Download Presentation

THE CURRENT SERVICES ROUND

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

Presentation Transcript


The current services round

THE CURRENT SERVICES ROUND


Services general perception

Services: General perception

  • NOT TRADABLE AND NOT STORABLE

    • Simultaneity of production and consumption

    • Role of local establishment

  • STRONG GOVERNMENT INVOLVEMENT

    • Existence of natural monopolies, public service obligations, etc.

    • Infrastructural importance of services (transport, telecom, etc.)

    • Role of non-economic objectives (social, cultural, safety)

  • INTANGIBLE

    • Quality criteria for services providers rather than for products

  • NO TARIFFS

    • Access conditions determined by regulation, quotas etc.


The current services round

But...

  • Certain services - international transport and communication - have been traded for centuries

  • Services are supplied in conjunction with goods (finance, insurance, marketing, etc.)

  • Services have become tradable as a result of:

    • technical progress (e-banking, tele-medicine, distance learning)

    • government retrenchment

    • market liberalization and regulatory reform


The current services round

Structure of GDP


The current services round

Importance of Services Trade

Limited role of services in total world

trade (~ 20 % on BOP basis) but ...

  • more rapid growth than goods trade

  • GATS broader in coverage than BOP

  • role of services in trade facilitation


Services trade has grown faster in developing than in high income countries

Services trade has grown faster in developing than in high-income countries

Source: World Bank


Services trade is becoming more important for upper middle income countries

Services trade is becoming more important for upper middle income countries

Source: World Bank


Increasing importance of cbt including for developing countries

Increasing importance of CBT, including for developing countries


The current services round

GATS: Scope, coverage, definition

  • MEASURES AFFECTING TRADE IN

    SERVICES AT ALL GOVERNMENT LEVELS

  • ALL SERVICES(except governmental services

    and measures affecting air traffic rights)

  • FOUR MODES OF SUPPLY

    • Cross-border supply

    • Consumption abroad

    • Commercial presence

    • Presence of natural persons


Modes of supply

Modes of supply

EXAMPLE (Health)

Tele-diagnosis from Country B into A

A’s resident obtains hospital treatment in B

Hospital operator from B has subsidiary in A

Physician from B practices in A

MODE

1. Cross-border Trade

2. Consumption Abroad

3. Commercial Presence

4. Movement of Natural

Persons


Purpose of the gats

Purpose of the GATS

  • Assists governments that want to reduce their trade barriers and/or consolidate reforms

  • Contributes to coordination of economic policy-making

  • Better access to foreign markets

  • Transparency and predictability of trading conditions

  • Efficient and impartial settlement of disputes


Gats key obligations

GATS: Key Obligations

  • Most-Favoured Nation (Article II)

    • Applies to all sectors

  • Obligations implying openness to international competition (Market Access and National Treatment) only apply in accordance with each Member’s schedule of commitments

    • Only in selected sectors

    • Subject to conditions and limitations inscribed


The current services round

Starting point of the negotiations

(‘progressive liberalization’

pursuant to Article XIX)


Pattern of commitments sectoral distribution

Pattern of Commitments: sectoral distribution


Pattern of commitments sector coverage

Pattern of commitments: sector coverage


The current services round

Level of Treatment for Committed Sectors


The current services round

Starting point: Applied Regimes

  • Actual regimes tend to be far more liberal in many countries than commitments suggest.

  • Widening gap between UR schedules and

    • schedules of recently acceded countries

    • access conditions negotiated under FTAs


The current services round

Services

Negotiations:

Process and

State of Play

(Specific Commitments)


How services negotiations work

How Services Negotiations Work

From the outset:

  • Essentially a bilateral process

  • Some key principles:

    • No sector or mode excluded a priori

    • Flexibility for developing countries

    • Starting point: existing commitments

    • No change in basic structure of the GATS


The current services round

STATE OF PLAY (July 2006)

INITIAL OFFERS:

71 Schedules (covering 95 Members*)

REVISED OFFERS:

31 Schedules (covering 55 Members*)

*Counting EC Members (EC 25) individually


Offers main features i

Offers: Main features (I)


Offers main features ii

Offers: Main features (II)


Sub sectors committed before and after offers all members

Sub-Sectors Committed: Before and After Offers (all Members)


Offers main features iii

Offers: Main features (III)

“Few, if any, new commercial opportunities would ensue for service suppliers. Most Members feel that the negotiations are not progressing as they should."[1]

Chair of CTSS, July 2005 (TN/S/20)


The current services round

  • Sobering Assessment:

  • Long delays

  • (initial target date: March 2003)

  • Modest achievements

  • (number of sectors and substance)

  • Uneven participation of developing

  • countries

  • Little change in MFN Exemptions

  • _____________________________________________________________________________

  • Little progress in rules negotiations


How negotiations work

How Negotiations Work

  • Since Hong Kong Ministerial:

    • Plurilateral request/offer process

    • LDCs not expected to undertake new commitments

    • No formula, but set of multilateral objectives per mode


The current services round

Negotiating Objectives (I)

Modes 1 to 3 (examples)

  • No requirement of commercial presence (mode 1)

  • Commitments at existing levels of access (modes 1 & 2)

  • Removal or substantial reduction of ENTs

    (modes 2 & 3)

  • Enhanced levels of foreign equity, more types of legal entity(mode 3)


The current services round

Remaining Risks...

  • Contamination from AG & NAMA

  • Lack of political resolve

  • Exaggerated expectations(access abroad as a substitute for own reform)

  • Impact of regionalism in services


Reason for hope nevertheless

Reason for Hope, Nevertheless

  • Experience with previous trade rounds

  • Too much at stake

  • No credible alternative to WTO

  • Domestic liberalization pressure in (infrastructure-related) services

    (> competiveness of user industries,

    threat of industrial relocation)


The current services round

WHAT NOW?


  • Login