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Trade in Services Division

World Trade Organization

Where are we in the WTO

Services Negotiations?

History of Post-UR negotiations

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1994

GATS

1995-1997

Financial Maritime Mode 4 Telecom

1995 …

Rule making Art. VI,X, XIII & XV

2000

Art. XIX Mandate

2001 …

Doha Development Agenda

DDA: Negotiating issues Specific commitments (“market access”)

Market access National treatment Other commitments

MFN exemptions Annex on Article II

Rules Domestic regulation Subsidies, Safeguards, Government procurement

Implementation of LDC modalities Measures falling under LDC waiver

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Milestones in the DDA negotiations

2005 Hong Kong Ministerial Declaration Annex C sets out ‘modalities’ for negotiations in services

Sectoral and modal negotiating objectives

Timelines for conclusion of the services negotiations

2008 Mini-Ministerial Meeting Draft text on services

Signalling Conference

Principle of LDC waiver

Eighth Ministerial Conference (2011) …

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State of play: Market access Initial offers

71 Schedules (covering 95 Members*) Last submission: 19 March 2008 (Belize)

Revised offers

31 Schedules (covering 55 Members*) Last submission: 22 August 2007 (Nigeria)

*Counting EC Members (EC 25) individually

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UR Commitments, Doha Offers and Actual Policies

ZAF

KENNGA

MUS

PHL

CHN

IDNMYS

THA

ALB

CZE

TUR

LTU

HUN

POLBGR

BHR

OMN

DOM

MEX

CHL

BRAPE R

BOL

TTOGTMHND

ARG

URY

PAN

CRI

COLNIC PRY

JOR

MAR

TUN

EGY

NZL

USA

DNK

AUS

GRC

FIN

JPN

PRT

AUTIRL

SWEDEU

NLDCANGBR

KOR BEL

ESP

ITAFRA

LKA

IND

PAK

ZAF

KEN

NGAMUS

PHL

CHN

IDN MYSTHA

ALB

CZE

TUR

LTU

HUNPOL

BGR

BHR

OMN

DOM

MEX

CHL

BRA

PE R

BOL

TTOGTMHND

ARG

URY

PAN

CRI

COLNIC PRY

JOR

MAR

TUNEGY

NZL

USADNK

AUS

GRC

FIN

JPN

PRT

AUT

IRLSWEDEU

NLD

CAN

GBR

KOR

BEL

ESP

ITA FRA

LKAIND

PAK

ZAFKENNGA

MUS

PHL

CHN

IDN

MYSTHA

ALB CZETUR

LTU

HUN

POLBGR

BHROMN

DOM

MEX

CHL

BRAPE R

BOL

TTO

GTMHND ARG

URY

PAN

CRI

COL

NIC

PRY

JOR

MAR

TUN

EGY

NZL

USA

DNK

AUSGRC

FIN

JPN

PRTAUT

IRLSWE

DEU

NLD

CAN

GBR

KORBEL

ESP

ITAFRA

LKA

IND

PAK

02

04

06

08

01

00

Serv

ice

s tr

ad

e r

estr

ictiv

eness

inde

x

0 10000 20000 30000 40000GDP per capita,PPP

Restr ictive ness of GATS co mmitment Fitted values

Restr ictive ness of DOHA Offers Fitted values

Restr ictive ness of actual policy Fitted values

STRI for 61 countries, excluding Qatar and 31 countries that did not submit offersSource: Borchert,Gootiiz, Mattoo 2010

UR commitments, Doha offers and actual policies by region

Source: Borchert, Gootiiz, Mattoo 2010

020

4060

80

Ser

vice

s tr

ade

rest

rictiv

enes

s in

dex

SAR GCC LAC AFR MENA EAP OECD ECA

Binding gap, offer gap and applied policy for 93 countries

Actual Policy

Offer gap (Doha Offer-Actual policy)

Offer Improvement (Uruguay Round commitment-Doha Offer)

UR commitment, Doha Offers, and actual policies by sector

Source: Borchert, Gootiiz, Mattoo 2010

010

2030

4050

6070

80

Ser

vice

s tr

ade

rest

rictiv

enes

s in

dex

Financial Telecom Retailing Maritime shipping Professional Overall

Offer Improvement (Uruguay Round commitment-Doha Offer)

Offer gap (Doha Offer-Actual policy)

Actual Policy

State of play: MFN exemptions

Some 40 exemptions (

State of play: Overall

Limited progress in the market access negotiations since July 2008.

Intensified negotiations on domestic regulation with notable progress, but disagreement persists on important and basic issues.

Technical work continues on GATS rules, although without convergence regarding the outcome in any of the subjects (ESM, GP, subsidies).

Report of Chair CTSS to TNC (TN/S/36 of 21 April 2011)

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MC 8: Looking ahead

The negotiations are at an impasse. Unlikely that all elements could be concluded simultaneously in the near future. Members need to more fully explore different negotiating approaches while respecting the principles of transparency and inclusiveness. Advance negotiations, where progress can be achieved, including focusing on elements that allow to reach provisional or definitive agreements based on consensus earlier than full conclusion.

Chairman’s Concluding Statement (excerpts), WT/MIN(11)/11 (17 December 2011)

LDC Services Waiver Enables Members to provide preferential

treatment to services and service suppliers of LDC without according the same treatment to like services and service suppliers of all other Members (TN/S/37)

It will be reviewed every year

It will expire 15 years after adoption

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MC 9: one item on services Operationalization of the Waiver Concerning

Preferential Treatment to Services and Service Suppliers of Least-Developed Countries – Ministerial Decision – WT/MIN(13)/43 - WT/L/918

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Operationalize the LDC waiver

A High-level meeting of the Council for Trade in Services six months after the submission of an LDC collective request identifying the sectors and modes of supply of particular export interest to them;

Developed and developing Members shall indicate sectors and modes of supply where they intend to provide preferential treatment to LDC services and service suppliers;

A Member may accord preferences similar to those arising from preferential trade agreements to which it is a party;

targeted and coordinated technical assistance aimed at strengthening the domestic and export services capacity of LDCs

The Council for Trade in Services shall periodically review the operationalization of the waiver

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‘Plurilaterals’ – A new approach(?)*

Agreement that aims to capture substantial part of liberalization achieved in other trade negotiations

Comprehensive in scope, substantial sectoral coverage, no a priori exclusion of any sector or mode of supply

Market access corresponding as closely as possible to actual practice plus opportunities for improved access

New and enhanced rules Intensify work from September 2012 on these concepts

* Media release (5 July 2012) from Australia, Canada, Colombia, Costa Rica, EU, Hong Kong China, Israel, Japan, Mexico, New Zealand, Norway, Pakistan, Peru, Korea, Switzerland, Chinese Taipei, Turkey, United States.

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Plurilateral - Option (I) Non-MFN outcome Agreement WTO rule Example Advantages Constraints

Economic Integration

GATS Art. V CAFTA TPP? ISA?

• Flexible format (+ or - list) • Agreement and

approval among interested Parties

• Higher level of ambition

• May not include all

commercially significant markets • Dispute

Settlement?

Addition to Marrakesh Agreement, Annex 4

Art. X.9 Marrakesh Agreement – WTO

Agreement on Government Procurement (GPA)

• Applies only to the signatories

• WTO Framework • WTO Dispute

Settlement

Ministerial Decision, requires consensus*

Plurilateral - Option (II) MFN outcome

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Agreement WTO rule Example Advantage Constraints

GATS Part III

GATS Art. II (MFN)

Services: Telecom Financial

Goods: Information Technology Agreement (ITA)

WTO Agreement WTO Dispute Settlement

Possibility of ‘free riders’ (?)

Post-Bali Programme Any services components?

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Perennial challenges in the services negotiations Linkage to other negotiating areas

Especially agriculture & NAMA

Difficult policy coordination in capitals

Sectoral responsibilities scattered among different ministries

Structure of GATS

Schedules and modal structure too complex?

Regionalism

Diversion of negotiating resources?

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In sum: Generate political leadership