Overall, services are a powerful source of employment for billions around the world, particularly for women and youth. This is also true on a regional scale. In Latin America and the Caribbean, the services sector accounts for 75 percent of the employment of women. Services trade also benefits businesses of all sizes. Technological advances now give small and medium sized enterprises (SMEs) the ability to extend their customer base through mobile phones and the internet, engaging them in the global market and increasing the potential for economic success. In Africa, 19 out of 20 phones are mobile, allowing individuals to manage businesses, pay bills, and buy food and other goods by phone. Supachai Panitchpakdi, former Secretary General of the U.N. Conference on Trade and Development (UNCTAD), recently noted that the services sector has the potential to “unlock inclusive and sustainable development�, thereby lifting living standards around the world. Developing nations are already harnessing the power of the services sector in many areas, including information and technological development, healthcare, as well as tourism and transport. The robust engagement of these sectors is a major inducement to foreign investors. As trade in services has continued to expand, the services sector has become the largest recipient of foreign direct investment (FDI), accounting for roughly 75 percent of total worldwide inflows. Due to increasing global market engagement, developing countries now receive over 50 percent of FDI from the services sector, demonstrating the 26
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increasing importance of services as a driver of economic growth. Services Connect the World Businesses, whether they are in services, manufacturing, or agriculture, rely on digital tools to be successful. Whether it is using the internet to buy and sell items or using a mobile phone to track payments, most businesses rely on the transfer of data to manage their company, serve their customers, and compete in the global market. As digital trade becomes more and more prominent, global trading rules need to facilitate the movement of data across borders in order for businesses to be successful in global trade. Modern production networks rely on tasks including cloud computing, data storage, the protection of intellectual property (IP), logistics, insurance, IT goods and services, and cross-border payments/ credits. The use of these networks can be seen in SMEs and large companies across the globe. Services have become increasingly important in global value chains and have utilised the age of digital trade to become successful in the global market. The Potential of the TISA The TISA creates the opportunity to develop an international set of rules and regulations necessary to manage the age of digital trade and to eliminate barriers that prevent the full potential of trade in services. Why is the TISA such an optimistic negotiation? Like the GATS, the negotiations are confined to services which prevents the negotiations from
becoming a hostage to impasses in other sectors. In addition, each of the parties in the negotiations has made an affirmative decision to join the negotiations. Furthermore, most of the parties already have track records of negotiating services market access beyond their current international commitments. There has been a high level of collaboration and alignment among the principal players in framing the negotiations and the parties are committed to an agreement that produces results in the near future. The TISA ultimately can form the template for the next generation of multilateral rules for international trade in services. As such, it deserves the close attention of all countries, including countries in the Caribbean who are striving to develop high-quality services industries. ANNUAL PUBLICATION 2014