Trade in Services Negotiations

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Sáez and Lanoszka

to Country C for heart surgeries or hip replacements in private hospitals that offer single rooms and butler services. Meanwhile, public hospitals are sometimes so overcrowded that patients are obliged to share beds. Many are forced to ask relatives for money so that they may transfer to private hospitals with computed tomography scanners or dialysis machines. Country C spends 1 percent of GDP on public health, far less than other countries at similar levels of per capita income. While the cost of private clinics and hospitals is out of the reach of most citizens of Country C, the public sector system suffers from inadequate funding. The public sector is divided into A1 and A2 providers of health services. A1 hospitals and clinics serve only government officials and members of the military. A2 hospitals and clinics serve low-income groups. Over the years, this division has been heavily criticized. It is well documented that the health care standards in the A1 facilities are much higher because A1 providers receive most of the government health care funding. Country C has well-developed business services especially in the field of data storage. The technology sector is, in fact, a success story in Country C. This is why policy makers should promote the export of services, such as data entry of health records and of health insurance claims, as a way to generate income and employment in the country. (Under the GATS, health data processing and storage services are not classified under health services, but under computer-related services.) Logistics services—Services that contribute to enhancing the competitiveness of production processes and delivery—the supply chain—are known as logistics services. Logistics services are crucial for achieving and maintaining a higher level of development. Businesses operating in Country C complain about logistics and transport delays. There are many challenges that the government of Country C must address, in consultation with private stakeholders. The complexities of logistics services mean that the government must examine its interests in market access and the regulatory, infrastructural, and institutional constraints in the country. An example of an area in which immediate improvements may be made is exports. Given that Country C moves most of its exports and receives its imports by sea, the efficient processing of cargos at the country’s four main harbors is critical. However, cargo containers are often lost or burglarized. Because of the administrative delays and poor communications between truck drivers and harbor officials, cargo containers are routinely kept outside within the harbor area for up to two days before


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