Negotiating Trade in Services: A Practical Guide for Developing Countries
Box 2.6
The Doha Round Shift toward Collective Requests For lack of a credible alternative and drawing on mercantilist reflexes honed in goods (that is, tariff ) negotiations, the bilateral request-offer approach was adopted in the Uruguay Round as the dominant negotiating method for opening up service markets.a Concern over the limited progress, time-consuming nature, and informationintensive asymmetries implicit in this approach led to a decision by the trade ministers at the December 2005 WTO ministerial meeting in Hong Kong, China to supplement, where practicable, bilateral request-offer discussions by plurilateral negotiations, the results of which would then be extended to all WTO members on a most favored nation basis. This approach involves groups of WTO members— akin to the numerous “friends groups” already existing under the GATS—that propose negotiating objectives in a sector or a cluster of sectors. At first, the shift toward plurilateral (or collective) discussions revealed a paradoxical aversion of developing countries toward alternatives to the current bilateral approach, even though the bilateral approach is more taxing on developing countries than on developed countries. This is mainly because of the considerable resources and time required by bilateral request-offer discussions, the limited number of service experts available for bilateral discussions in Geneva and in capital cities, the negotiating imbalances that flow from the limited ability of most developing countries to formulate their own requests, the significant asymmetries in the information relevant to negotiations that is available to policy officials, and the more limited stakeholder consultations, private sector engagement, and presence abroad of service suppliers. All these factors tend to interact to produce least common denominator, precaution-induced outcomes at the negotiating table. This complicates attempts to marshal corporate interest in multilateral negotiations and tends to shift incentives toward bilateral or neighborhood responses through PTAs. Plurilateral approaches are likely to economize on the scarcest commodities— time and human resources—and afford developing countries significant economies of scale in negotiating efforts. Avoiding the sector-by-sector and country-by-country bartering of commitments may substantially reduce the transaction costs of negotiations. These approaches also offer a useful means for developing countries to pool their resources in pursuit of common objectives and join forces with other country groupings (developed and developing) to help build useful reform coalitions in talks. (continued)
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