Info Service on WTO and Trade Issues (May15/02)
8 May 2015
Third World Network
North-South divide in services talks
Published in SUNS #8014 dated 4 May 2015
Geneva, 30 Apr (D. Ravi Kanth) -- A large majority of developing and
least-developed countries at the World Trade Organisation (WTO) have
demanded that the Annex C of the Hong Kong Ministerial Declaration
must remain the basis for drawing-up the post-Bali work programme
on services, according to trade envoys familiar with the non-attributable
summary issued by the chair of the Doha services negotiations on 27
The chair, Ambassador Gabriel Duque of Colombia, issued a five-page
non-attributable summary setting out the positions held by members
in which the views of the developing countries differ from those held
by the developed countries, said an African trade envoy, who preferred
not to be identified.
The chair's summary will come up for discussion on 5 May at an informal
In his five-page restricted non-attributable summary issued to members
on 27 April, Ambassador Duque said most members acknowledged that
the services negotiations formed an "essential" part of
the Doha Development Agenda (DDA) negotiations.
[The architecture of the WTO's General Agreement on Trade in Services
(GATS) envisages in terms of its Art. XIX, the "progressive liberalisation"
of the services trade, with members engaging in a round of services
negotiations every five years (Art. XIX: 1) starting from the date
of WTO entry into force, and with guidelines to be established by
the Council for Trade in Services for each round of negotiations both
overall and sectorally (XIX: 3), and with an overall guidance set
in Art XIX: 2. Such a second round was agreed upon and launched in
2000, but this was rolled into the Doha Round launched in November
2001 at Doha. The Hong Kong Ministerial Declaration and mandate, in
Annex C, set further parameters for voluntary services liberalisation,
but ensuring fidelity with the basic GATS architecture.
[During the preparatory process for the Seattle ministerial and subsequently,
and at the time of the launch of the Doha negotiations, the EU, US
and other developed countries said they had to undertake some painful
cuts in their agricultural support programmes, and needed some political
cover to enable them to point to likely concessions they would get
in services, and hence the earlier launched services negotiations
should be rolled into the Doha talks. Believing in such promises,
the developing countries agreed. However, the commitments on agriculture
are not only sought to be resiled from by arguments about changes
in trade, but the services liberalisation is sought to be de-linked
to get more concessions from the developing world while jettisoning
the Doha mandates. The current arguments in the services talks also
appear to be attempts of the US and EU to repudiate all this earlier
history and narration, while attempting a parallel exercise of an
arguably illegal attempt to negotiate and insert into the WTO a conditional
non-MFN plurilateral services accord, the so-called Trade in Services
Agreement (TiSA). -- SUNS]
According to the Chair, given the growing share and importance of
services in the global trade, one country maintained that services
are the "engine" of economic growth while another member
spoke of the critical importance of services to its economy, the chair
Most members pressed for a "realistic, doable, and balanced"
outcome in the services negotiations, while some countries called
for an "ambitious" outcome. A few others wanted "good,
credible, and meaningful results" in the services negotiations,
according to the chair.
As regards the way forward for the services negotiations in the post-Bali
work programme, most members called for "calibrated" movement
with those in agriculture and market access for industrial goods,
while farm-producing countries of South America insisted that the
level of ambition in agriculture must decide the outcome in services.
The chair said "one delegation took the view that the services
negotiations were a complementary pillar of the DDA" while some
other members suggested that services should not be "de-linked
from other pillars and therefore, should not lag behind."
A few delegations, according to the chair, "cautioned that the
negotiations on services could not await the outcome of post-Bali
work in agriculture and NAMA, since services negotiations were particularly
lengthy and needed an early start."
Many members, especially the developing countries, demanded that Annex
C of the 2005 Hong Kong Ministerial Declaration should guide the objectives
of the post-Bali work programme while one delegation said the Hong
Kong Ministerial Declaration provided "for bilateral and plurilateral
market access negotiations, text-based negotiations on domestic regulation,
focused discussion on the GATS rules."
Some members, the chair said, pressed for "other milestones in
the [Doha services] negotiations" such as the existing initial
offers and revised offers, the plurilateral requests, and the 2008
Signaling Conference to guide the objectives of the work programme.
However, the US and Australia did not want the previous milestones
to be the starting point for setting the ambition in the work programme
as "those milestones did not reflect subsequent changes in the
patterns of trade and further autonomous liberalization," said
a trade envoy from Asia.
India and countries of the African, Caribbean and Pacific (ACP) group
said that "it was important that the Work Programme fully express
the development dimension of the negotiation."
Both India and ACP members emphasised the "importance of flexibilities
granted to developing country Members in the GATS itself, such as
in Article XIX: 2 as well as in the existing negotiating mandates
such as Annex C."
Many industrialised countries acknowledged the importance of market
access in any services outcome while Japan stated unambiguously that
market access was central to services outcome, "given the very
low or symbolic level of commitments that had been agreed in the Uruguay
But one member said that it is not going to make any further movements
to its DDA offer, according to the chair's summary.
Norway proposed a minimum binding of sectors in existing GATS commitments
at the level applied domestically or in the RTAs (regional trade agreements),
followed by a request/offer process for sectors currently outside
the schedule with a view to achieving the binding at the applied level,
said a developing country trade envoy.
For many members, said Ambassador Duque, the Annex C in the Hong Kong
Ministerial Declaration was an important guide for determining the
market access contents of the post-Bali work programme while some
members spoke of the previous milestones such as revised offers, plurilateral
requests, and indications from the Signaling Conference.
However, some developed countries said that "binding of a significant
portion of "water" in the GATS commitments was a realistic
and doable outcome." Singapore and Australia underscored the
need to take into account "RTAs and autonomous liberalization
to assess how much "water" could be bound," implying
the removal of the gap between current bound and autonomous commitments,
according to negotiators familiar with the informal open-ended meetings.
India, Barbados on behalf of small and vulnerable economies (SVEs)
and ACP countries, and Malaysia among others said "with respect
to developing countries, the market access part of the Work Programme
needed to fully express the development dimension of the negotiations."
For SVE and ACP members, said Barbados, "flexibilities granted
to developing countries members in GATS Articles IV and XIX: 2, Annex
C of the Hong Kong Ministerial Declaration, and the negotiating guidelines"
must be preserved intact.
The Recently Acceded Members (RAMs) led by Chinese Taipei said they
had undertaken GATS commitments that in many cases were similar or
greater than that of developed country members. Therefore, other countries
should also make commitments at similar levels, the RAMs argued.
The LDCs demanded that the Bali ministerial declaration on services
- which includes a waiver, granting of preferences, full and effective
implementation of LDC modalities and Annex C of the Hong Kong Ministerial
Declaration - must be fully implemented.
Mexico suggested the submission of revised offers by the end of September,
after Members undertake intensive negotiations in order to submit
final offers by December 2015.
The following countries demanded specific market access in specified
sectors, according to several negotiators familiar with the services
* Australia: Financial, IT (services telecom, computer and related),
professional, construction and related engineering, freight, transport
and logistics, environment, private education, mining and energy-related
services; in all these reducing restrictions on cross-border supply,
foreign equity caps, use of business names, joint venture requirements;
* Canada: Environmental services;
* Hong Kong-China: New and improved commitments in the following indispensable
sectors: maritime, logistics and related, telecom, financial, computer
and related services, as well as work on non-sectoral, cross-cutting
issues such as the elimination or substantial reduction (or at least
clarification of scope) of MFN exemptions; full market access and
national treatment in cross-border supply, especially professional
services, research and development and distribution services as set
out in the plurilateral request on cross-border supply; removal of
horizontal limitations in mode 3, especially foreign equity limitations;
improvement of offers in above areas as outlined in collective requests;
* Japan: Computer and related, telecom, distribution, financial, maritime,
and other services;
* India: Liberalization of mode 4, sectors of export interest to developing
countries, binding of market access and national treatment in all
modes of supply in favour of developing countries;
* New Zealand: Considerable importance of mode 1, need to update schedules
for services now technically feasible, particular interest in mode
3, private education, environmental, air services, maritime, logistics,
computer and related services, postal and courier, retail trade and
distribution, business and professional services;
* Norway: Locking in of market access and national treatment in telecom,
maritime and energy services, insurance, maritime transport services
and energy-related services, and reintegrating the maritime sector
through the application of MFN;
* Chinese Taipei: Computer, maritime, logistics, telecom, construction,
engineering, audiovisual, environment, distribution and tourism;
* Switzerland: Improved market access and national treatment commitments
in areas covered by the plurilateral requests, with the highest priority
in computer and related services, telecom, distribution, construction,
and energy services.
Many industrialised countries members also called for ambitious results
in domestic regulation and said it should be part of the services
element of a post-Bali work programme. A majority of delegations expressed
an interest in domestic regulation disciplines that ensured that negotiated
market access outcomes are not undermined, the chair maintained.
The US, Canada, and Brazil warned that "deep horizontally applicable
disciplines, including on a necessity test, would not be feasible
in the context of a post-Bali Work Programme with overall reduced
ambition," said a services negotiator who took part in the chair's
Turkey said a successful conclusion of the Domestic Regulation element
of the post-Bali Work Programme should encourage members to develop
disciplines on administrative measures regarding visas and temporary
work permits that heavily impede in particular developing country
service suppliers' ability to provide services.
India, members of the ACP group, and Uganda underscored the need "for
special and differential treatment provisions that linked the obligation
to implement regulatory disciplines to the acquisition of capacity
through the provision of adequate assistance and support for capacity
building, as well as self-selection of transition periods."
Except for Singapore, all other members of the Association of South
East Asian Nations (ASEAN) called for the inclusion of emergency safeguards
in the post-Bali work programme.
"One delegation noted that an outcome on emergency safeguards
could provide a balancing element in the services negotiations,"
according to the summary. +