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GATS and Services RTAs: How Relevant for Global Value Chains?. Martin Roy WTO Secretariat. Services and Global Value Chains. Services are: Enablers of goods-focused GVC Essential component of goods-focused GVC Drivers of certain goods-focused GVC GVCs in their own right.
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GATS and Services RTAs: How Relevant for Global Value Chains? Martin Roy WTO Secretariat
Services and Global Value Chains • Services are: • Enablers of goods-focused GVC • Essential component of goods-focused GVC • Drivers of certain goods-focused GVC • GVCs in their own right
Role of Trade Commitments and Agreements on Services • Legal guarantees • Reducing access barriers • Addressing regulatory barriers But… • Limited commitments under GATS so far • How have services RTAs fared in relation to facilitating GVC?
General Trends • Services RTAs are proliferating • 6 services RTAs notified before 2000; 97 since 2000. • 11 WTO Members involved in such RTAs before 2000; a majority are now. • Still a small fraction of all RTAs notified, but common feature of RTAs involving developed countries
Assessing Commitments in Services RTAs • Purpose of the research: • Assess liberalization commitments in recent RTAs and compare them with achievements under GATS and the DDA. • Provide a basis for analysing trends and implications, and open avenues for future research, including on supply chains.
Data and Methodology • Analysis of market access and national treatment commitments of 53 Members (EU as one) in 67 RTAs • Focus on Modes 1 and 3 • Comparison between a Member’s GATS commitments, DDA offer, and various RTA commitments, per mode of supply and per subsector. Roy (2011), “Services Commitments in Preferential Trade Agreements: An Expanded Dataset”, WTO Staff Working Paper, http://www.wto.org/english/res_e/reser_e/ersd201118_e.pdf
Data and Methodology Two basic approaches used: • Proportion of sub-sectors newly committed or improved. • An Hoekman-type index of GATS+ commitments in RTAs. • Starting Point: • Score of 1 for full commitments • Score of 0.5 for partial commitments • Score of 0 for no commitment
Key Trends: Sectoral Coverage Source: Roy (2011), updated from Roy, Marchetti and Lim (2007)
WB Restrictiveness Index: Transport Services in Latin America (Data from World Bank STRI database)
Restrictiveness Index: Finance, Telecom, Professional Services (regional average) (Data from World Bank STRI database)
WB Restrictiveness Index: Finance, Telecom, Professional Services (Data from World Bank STRI database)
WB Logistics Performance Index • No LA country in top 30 • ‘Top’ performers include: • Chile (39), Brazil (45), Mexico (47), Argentina (49), Colombia (64)
Implications… • Limits to what RTAs can – and have - achieved • Impact of RTAs on multilateral services negotiations • Multilateralism brings particular challenges, but greatest possible rewards