Trade in Services Negotiations

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Marconini and Sauvé

of the trade in goods, the principal gains from the trade in services— those most likely to enhance national welfare—relate to the possibilities offered by trade for importing a broader array of less expensive or higher-quality products than is available on the domestic market and for exposing domestic suppliers to greater competition in an orderly, adjustment-promoting manner, as well as for attracting foreign investment in key sectors. Service negotiations represent a unique opportunity for countries at all levels of development to secure more favorable terms of access to foreign service markets that reliance on unilateral reform alone is not able to provide. The preparations needed to put together informed requests can also benefit from the regulatory inventories and capacity-building efforts described above. But additional matters must be addressed if a country is to assemble development-enhancing requests. Request lists are offensive (as opposed to defensive). They focus on sectors, subsectors, and modes of supply relative to which the requesting countries are asking partner countries progressively to remove or lessen access-impairing regulatory measures. The main motivation behind request lists is the promotion of the export interests of the leading service providers of the requesting country. The content of a country’s request list should therefore be based on an assessment of these interests, which is absent in the approach many developing countries take to the negotiations. In theory, nothing prevents a country from asking for commitments in all sectors included under service agreements. The reason such an outcome normally does not arise in practice is that countries are often reluctant to formulate requests in areas where they may not be in a position to offer reciprocal concessions. This may explain why relatively few developing countries took part in the collective requests formulated after the WTO Ministerial Conference held in Hong Kong, China, in December 2005. Putting together targeted negotiating requests requires detailed information about the measures that are hindering access to the markets of key trading partners. The breadth of the service trade and the diversity of the sectors involved render information-gathering a large and complex task with which many developing countries, even larger ones, experience recurring difficulties. The difficulties are compounded if the channels of communication with key stakeholders (that is, chambers of commerce, service firms already active in world markets, firms in active prospecting mode, embassies in key foreign markets, and so on) are inadequate. This


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