Historical Background. The General Agreement on Trade in Services (GATS) is the first multilateral trade agreement to cover trade in services. Its creation was one of the major achievements of the Uruguay Round of trade negotiations, from 1986 to 1993. This was almost half a century after the entry into force of the General Agreement on Tariffs and Trade (GATT) of 1947, the GATS' counterpart in merchandise trade. The need for a trade agreement in services has long been questioned. Large segments of the services economy, from hotels and restaurants to personal services, have traditionally been considered as domestic activities that do not lend themselves to the application of trade policy concepts and instruments. Other sectors, from rail transport to telecommunications, have been viewed as classical domains of government ownership and control, given their infrastructural importance and the perceived existence, in some cases, of natural monopoly situations. A third important group of sectors, including health, education and basic insurance services, are considered in many countries as governmental responsibilities, given their importance for social integration and regional cohesion, which should be tightly regulated and not be left to the rough and tumble of markets. Nevertheless, some services sectors, in particular international finance and maritime transport, have been largely open for centuries - as the natural complements to merchandise trade. Other large sectors have undergone fundamental technical and regulatory changes in recent decades, opening them to private commercial participation and reducing, even eliminating, existing barriers to entry. The emergence of the Internet has helped to create a range of internationally tradeable product variants - from e-banking to tele-health and distance learning - that were unknown only two decades ago, and has removed distance-related barriers to trade that had disadvantaged suppliers and users in remote locations (relevant areas include professional services such as software development, consultancy and advisory services, etc.). A growing number of governments has gradually exposed previous monopoly domains to competition; telecommunication is a case in point. This reflects a basic change in attitudes. The traditional framework of public service increasingly proved inappropriate for operating some of the most dynamic and innovative segments of the economy, and governments apparently lacked the entrepreneurial spirit and financial resources to exploit fully existing growth potential. Services have recently become the most dynamic segment of international trade. Since 1980, world services trade has grown faster, albeit from a relatively modest basis, than merchandise flows. Defying wide-spread misconceptions, developing countries have strongly participated in that growth. Whereas in 1980 their share of world services exports amounted to 20%, in 2004 it was 24% on a Balance of Payment (BOP) basis. Given the continued momentum of world services trade, the need for internationally recognized rules became increasingly pressing.
Appears in 4 contracts
Samples: General Agreement, General Agreement, General Agreement
Historical Background. The General Agreement on Trade in Services (GATS) is the first multilateral trade agreement to cover trade in services. Its creation was one of the major achievements of the Uruguay Round of trade negotiations, negotiations held from 1986 to 1993. This was almost half a century after the entry into force of the General Agreement on Tariffs and Trade (GATT) of 1947, the GATS' GATS counterpart in merchandise trade. The need for a trade agreement in services has long been questioned. Large segments seg- ments of the services economy, from hotels and restaurants to personal services, have traditionally been considered as domestic activities that do not lend themselves them- selves to the application of trade policy concepts and instruments. Other sectors, from rail transport to telecommunications, have been viewed as classical domains of government ownership and control, given their infrastructural importance and the perceived existence, in some cases, of natural monopoly situations. A third important impor- tant group of sectors, including health, education and basic insurance services, are considered in many countries as to be governmental responsibilities, given their importance for social integration and regional cohesion, which should be tightly regulated and not be left to the rough and tumble of markets. Nevertheless, some services sectors, in particular international finance and maritime mar- itime transport, have been largely open for centuries - – as the natural complements to merchandise trade. Other large sectors have undergone fundamental technical and regulatory changes in recent decades, opening them to private commercial participation par- ticipation and reducing, even eliminating, existing barriers to entry. The emergence of the Internet has helped to create a range of internationally tradeable product variants - – from e-banking to tele-health and distance learning - – that were unknown only two decades ago, and has removed distance-related barriers to trade that had disadvantaged suppliers and users in remote locations (relevant areas include professional pro- fessional services such as software development, consultancy and advisory services, etc.). A growing number of governments has gradually exposed previous monopoly domains to competition; telecommunication is a case in point. This reflects a basic change in attitudes. The traditional framework of public service ser- vice increasingly proved inappropriate for operating some of the most dynamic and innovative segments of the economy, and governments apparently lacked the entrepreneurial spirit and financial resources to exploit fully existing growth potential. Basic purpose and concepts Services have recently become the most dynamic segment of international trade. Since 1980, 1980 world services trade has grown faster, albeit from a relatively modest basis, than merchandise flows. Defying wide-spread widespread misconceptions, developing countries have strongly participated in that growth. Whereas in 1980 Between 1990 and 2000 their share services exports, consisting mainly of world services exports amounted to 20%tourism and travel services, in 2004 it was 24% grew 3 per cent more rapidly per annum, on a Balance of Payment (BOP) balance-of-payments basis, than developed countries’ exports. Given the continued momentum of world services trade, the need for internationally interna- xxxxxxxx recognized rules became increasingly pressing.. BASIC PURPOSE As stated in its Preamble, the GATS is intended to contribute to trade expansion “under conditions of transparency and progressive liberalization and as a means of promoting the economic growth of all trading partners and the development of developing countries”. Trade expansion is thus not seen as an end in itself, as some critical voices allege, but as an instrument to promote growth and development. The link with development is further reinforced by explicit references in the Xxxxx- ble to the objective of increasing participation of developing countries in services trade and to the special economic situation and the development, trade and financial needs of the least developed countries. The GATS’ contribution to world services trade rests on two main pillars: (a) ensuring increased transparency and predictability of relevant rules and regulations, and (b) promoting progressive liberalization through successive rounds of negoti- ations. Within the framework of the Agreement, the latter concept is tantamount to improving market access and extending national treatment to foreign services and service suppliers across an increasing range of sectors. It does not, however, entail deregulation. Rather, the Agreement explicitly recognizes the right of govern- ments to regulate and to introduce new regulations in order to meet national policy objectives, and the particular need of developing countries to exercise this right. To a considerable degree, the drafters of the GATS took inspiration from the GATT and used terms and concepts that had already been tested for decades in merchandise trade. These include the principles of most-favoured-nation (MFN) treatment and national treatment. Comparable to its status under the GATT, MFN treatment – the obligation not to discriminate between fellow WTO Members – is an unconditional obligation, which applies across all services covered by GATS. The tariff schedules under the GATT, in which countries bind their tariff concessions on merchandise imports, find their equivalent in schedules of specific commitments which define the relevant trade conditions for services. Reflecting peculiarities of services trade, however, there are also notable differ- ences in scope and content between the two agreements. A Handbook on the GATS Agreement
Appears in 1 contract
Samples: General Agreement
Historical Background. The General Agreement on Trade in Services (GATS) is the first multilateral trade agreement to cover trade in services. Its creation was one of the major achievements of the Uruguay Round of trade negotiations, from 1986 to 1993. This was almost half a century after the entry into force of the General Agreement on Tariffs and Trade (GATT) of 1947, the GATS' counterpart in merchandise trade. The need for a trade agreement in services has had long been questioned. Large segments of the services economy, from hotels and restaurants to personal services, have had traditionally been considered as domestic activities that do not lend themselves to the application of trade policy concepts and instruments. Other sectors, from rail transport to telecommunications, have been viewed as classical domains of government ownership and control, given their infrastructural importance and the perceived existence, in some cases, of natural monopoly situations. A third important group of sectors, including health, education and basic insurance services, are considered in many countries as governmental responsibilities, given reflecting their importance for social integration and regional cohesion, which should be tightly regulated and not be left to the rough and tumble of markets. Nevertheless, some services sectors, in particular international finance and maritime transport, have been largely open for centuries - as the natural complements to merchandise trade. Other large sectors have undergone fundamental technical and regulatory changes in recent decades, opening them to private commercial participation and reducing, even eliminating, existing barriers to entry. The emergence of the Internet has helped to create a range of internationally tradeable tradable product variants - from e-banking to tele-health and distance learning - that were unknown only two decades ago, and has removed distance-related barriers to trade that had disadvantaged suppliers and users in remote locations (relevant areas include professional services such as software development, consultancy and advisory services, etc.). A growing number of governments has gradually exposed previous monopoly domains to competition; telecommunication is a case in point. This reflects These developments reflect a basic change in attitudesattitudes in key areas. The traditional (monopoly) framework of public service increasingly proved inappropriate for operating some of the most dynamic and innovative segments of the economy, and governments apparently lacked the entrepreneurial spirit and financial resources to exploit fully existing growth potential. Services have recently over the years become the most dynamic segment of international trade. Since 1980, world services trade has grown faster, albeit from a relatively modest basis, than merchandise flows. Defying wide-spread misconceptions, developing countries have strongly participated in that growth. Whereas in 1980 their share of world developing countries' services exports amounted to 20%exports, in 2004 it was 24% on a Balance balance of Payment payments (BOP) basis. Given the continued momentum , amounted to one fifth of world exports of services in 1980, they had risen to over a quarter by 2000 to reach around one-third in recent years. BOP data show that trade in services represents between 20 and 25% of global trade in goods and services. However, these data on international transactions do not cover services delivered via foreign affiliates (i.e. mainly referring to mode 3 supply of services). Total international supply of services is therefore considered to be significantly larger than balance-of-payments figures indicate. Taking into account data derived from Foreign affiliates statistics (FATS), it is estimated that actual global trade in services is at least twice as high as the number derived from BOP figures. At the same time, new data on trade measured in value added terms highlight the importance of services, in particular locally sourced services, in global value chains. Estimates show that in value added terms, locally sourced services, whether exported as services or integrated in goods traded, represent about half of the total value of world trade, the need for internationally recognized rules became increasingly pressing.
Appears in 1 contract
Samples: General Agreement
Historical Background. The General Agreement on Trade in Services (GATS) is the first multilateral trade agreement to cover trade in services. Its creation was one of the major achievements of the Uruguay Round of trade negotiations, negotiations held from 1986 to 1993. This was almost half a century after the entry into force of the General Agreement on Tariffs and Trade (GATT) of 1947, the GATS' GATS counterpart in merchandise trade. The need for a trade agreement in services has long been questioned. Large segments seg- ments of the services economy, from hotels and restaurants to personal services, have traditionally been considered as domestic activities that do not lend themselves them- selves to the application of trade policy concepts and instruments. Other sectors, from rail transport to telecommunications, have been viewed as classical domains of government ownership and control, given their infrastructural importance and the perceived existence, in some cases, of natural monopoly situations. A third important impor- tant group of sectors, including health, education and basic insurance services, are considered in many countries as to be governmental responsibilities, given their importance for social integration and regional cohesion, which should be tightly regulated and not be left to the rough and tumble of markets. Nevertheless, some services sectors, in particular international finance and maritime mar- itime transport, have been largely open for centuries - – as the natural complements to merchandise trade. Other large sectors have undergone fundamental technical and regulatory changes in recent decades, opening them to private commercial participation par- ticipation and reducing, even eliminating, existing barriers to entry. The emergence of the Internet has helped to create a range of internationally tradeable product variants - – from e-banking to tele-health and distance learning - – that were unknown only two decades ago, and has removed distance-related barriers to trade that had disadvantaged suppliers and users in remote locations (relevant areas include professional pro- fessional services such as software development, consultancy and advisory services, etc.). A growing number of governments has gradually exposed previous monopoly domains to competition; telecommunication is a case in point. This reflects a basic change in attitudes. The traditional framework of public service ser- vice increasingly proved inappropriate for operating some of the most dynamic and innovative segments of the economy, and governments apparently lacked the entrepreneurial spirit and financial resources to exploit fully existing growth potential. Basic purpose and concepts Services have recently become the most dynamic segment of international trade. Since 1980, 1980 world services trade has grown faster, albeit from a relatively modest basis, than merchandise flows. Defying wide-spread widespread misconceptions, developing countries have strongly participated in that growth. Whereas in 1980 Between 1990 and 2000 their share services exports, consisting mainly of world services exports amounted to 20%tourism and travel services, in 2004 it was 24% grew 3 per cent more rapidly per annum, on a Balance of Payment (BOP) balance-of-payments basis, than developed countries’ exports. Given the continued momentum of world services trade, the need for internationally interna- tionally recognized rules became increasingly pressing.. BASIC PURPOSE As stated in its Preamble, the GATS is intended to contribute to trade expansion “under conditions of transparency and progressive liberalization and as a means of promoting the economic growth of all trading partners and the development of developing countries”. Trade expansion is thus not seen as an end in itself, as some critical voices allege, but as an instrument to promote growth and development. The link with development is further reinforced by explicit references in the Xxxxx- ble to the objective of increasing participation of developing countries in services trade and to the special economic situation and the development, trade and financial needs of the least developed countries. The GATS’ contribution to world services trade rests on two main pillars: (a) ensuring increased transparency and predictability of relevant rules and regulations, and (b) promoting progressive liberalization through successive rounds of negoti- ations. Within the framework of the Agreement, the latter concept is tantamount to improving market access and extending national treatment to foreign services and service suppliers across an increasing range of sectors. It does not, however, entail deregulation. Rather, the Agreement explicitly recognizes the right of govern- ments to regulate and to introduce new regulations in order to meet national policy objectives, and the particular need of developing countries to exercise this right. To a considerable degree, the drafters of the GATS took inspiration from the GATT and used terms and concepts that had already been tested for decades in merchandise trade. These include the principles of most-favoured-nation (MFN) treatment and national treatment. Comparable to its status under the GATT, MFN treatment – the obligation not to discriminate between fellow WTO Members – is an unconditional obligation, which applies across all services covered by GATS. The tariff schedules under the GATT, in which countries bind their tariff concessions on merchandise imports, find their equivalent in schedules of specific commitments which define the relevant trade conditions for services. Reflecting peculiarities of services trade, however, there are also notable differ- ences in scope and content between the two agreements. A Handbook on the GATS Agreement
Appears in 1 contract
Samples: General Agreement
Historical Background. The General Agreement on Trade in Services (GATS) is the first first multilateral trade agreement to cover trade in services. Its creation was one of the major achievements of the Uruguay Round of trade negotiations, negotiations held from 1986 to 1993. This was almost half a century after the entry into force of the General Agreement on Tariffs and Trade (GATT) of 1947, the GATS' GATS counterpart in merchandise trade. The need for a trade agreement in services has long been questioned. Large segments seg- ments of the services economy, from hotels and restaurants to personal services, have traditionally been considered as domestic activities that do not lend themselves them- selves to the application of trade policy concepts and instruments. Other sectors, from rail transport to telecommunications, have been viewed as classical domains of government ownership and control, given their infrastructural importance and the perceived existence, in some cases, of natural monopoly situations. A third important impor- tant group of sectors, including health, education and basic insurance services, are considered in many countries as to be governmental responsibilities, given their importance for social integration and regional cohesion, which should be tightly regulated and not be left to the rough and tumble of markets. Nevertheless, some services sectors, in particular international finance finance and maritime mar- itime transport, have been largely open for centuries - – as the natural complements to merchandise trade. Other large sectors have undergone fundamental technical and regulatory changes in recent decades, opening them to private commercial participation par- ticipation and reducing, even eliminating, existing barriers to entry. The emergence of the Internet has helped to create a range of internationally tradeable product variants - – from e-banking to tele-health and distance learning - – that were unknown only two decades ago, and has removed distance-related barriers to trade that had disadvantaged suppliers and users in remote locations (relevant areas include professional pro- fessional services such as software development, consultancy and advisory services, etc.). A growing number of governments has gradually exposed previous monopoly domains to competition; telecommunication is a case in point. This reflects reflects a basic change in attitudes. The traditional framework of public service ser- vice increasingly proved inappropriate for operating some of the most dynamic and innovative segments of the economy, and governments apparently lacked the entrepreneurial spirit and financial financial resources to exploit fully existing growth potential. Basic purpose and concepts Services have recently become the most dynamic segment of international trade. Since 1980, 1980 world services trade has grown faster, albeit from a relatively modest basis, than merchandise flowsflows. Defying wide-spread widespread misconceptions, developing countries have strongly participated in that growth. Whereas in 1980 Between 1990 and 2000 their share services exports, consisting mainly of world services exports amounted to 20%tourism and travel services, in 2004 it was 24% grew 3 per cent more rapidly per annum, on a Balance of Payment (BOP) balance-of-payments basis, than developed countries’ exports. Given the continued momentum of world services trade, the need for internationally interna- tionally recognized rules became increasingly pressing.. BASIC PURPOSE As stated in its Preamble, the GATS is intended to contribute to trade expansion “under conditions of transparency and progressive liberalization and as a means of promoting the economic growth of all trading partners and the development of developing countries”. Trade expansion is thus not seen as an end in itself, as some critical voices allege, but as an instrument to promote growth and development. The link with development is further reinforced by explicit references in the Xxxxx- ble to the objective of increasing participation of developing countries in services trade and to the special economic situation and the development, trade and financial needs of the least developed countries. The GATS’ contribution to world services trade rests on two main pillars: (a) ensuring increased transparency and predictability of relevant rules and regulations, and (b) promoting progressive liberalization through successive rounds of negoti- ations. Within the framework of the Agreement, the latter concept is tantamount to improving market access and extending national treatment to foreign services and service suppliers across an increasing range of sectors. It does not, however, entail deregulation. Rather, the Agreement explicitly recognizes the right of govern- ments to regulate and to introduce new regulations in order to meet national policy objectives, and the particular need of developing countries to exercise this right. To a considerable degree, the drafters of the GATS took inspiration from the GATT and used terms and concepts that had already been tested for decades in merchandise trade. These include the principles of most-favoured-nation (MFN) treatment and national treatment. Comparable to its status under the GATT, MFN treatment – the obligation not to discriminate between fellow WTO Members – is an unconditional obligation, which applies across all services covered by GATS. The tariff schedules under the GATT, in which countries bind their tariff concessions on merchandise imports, find their equivalent in schedules of specific commitments which define the relevant trade conditions for services. Reflecting peculiarities of services trade, however, there are also notable differ- ences in scope and content between the two agreements. A Handbook on the GATS Agreement
Appears in 1 contract
Samples: General Agreement
Historical Background. The General Agreement on Trade in Services (GATS) is the first and only multilateral trade agreement to cover trade in services. Its creation was one of the major achievements of the Uruguay Round of trade negotiations, from 1986 to 1993. This was almost half a century after the entry into force of the General Agreement on Tariffs and Trade (GATT) of 1947, the GATS' counterpart in merchandise trade. The need for a trade agreement in services has had long been questioned. Large segments of the services economy, from hotels and restaurants to personal services, have had traditionally been considered as domestic activities that do not lend themselves to the application of trade policy concepts and instruments. Other sectors, from rail transport to telecommunications, have been viewed as classical domains of government ownership and control, given their infrastructural importance and the perceived existence, in some cases, of natural monopoly situations. A third important group of sectors, including health, education and basic insurance services, are considered in many countries as governmental responsibilities, given reflecting their importance for social integration and regional cohesion, which should be tightly regulated and not be left to the rough and tumble of markets. Nevertheless, some services sectors, in particular international finance and maritime transport, have been largely open for centuries - as the natural complements to merchandise trade. Other large sectors have undergone fundamental technical and regulatory changes in recent decades, opening them to private commercial participation and reducing, even eliminating, existing barriers to entry. The emergence of the Internet has helped to create a range of internationally tradeable tradable product variants - from e-banking to tele-health and distance learning - that were unknown only two decades ago, and has removed distance-related barriers to trade that had disadvantaged suppliers and users in remote locations (relevant areas include professional services such as software development, consultancy and advisory services, etc.). A growing number of governments has gradually exposed previous monopoly domains to competition; telecommunication is a case in point. This reflects These developments reflect a basic change in attitudesattitudes in key areas. The traditional (monopoly) framework of public service increasingly proved inappropriate for operating some of the most dynamic and innovative segments of the economy, and governments apparently lacked the entrepreneurial spirit and financial resources to exploit fully existing growth potential. Services have recently over the years become the most dynamic segment of international trade. Since 1980, world services trade has grown faster, albeit from a relatively modest basis, than merchandise flows. Defying wide-spread misconceptions, developing countries have strongly participated in that growth. Whereas in 1980 their share of world developing countries' services exports amounted to 20%exports, in 2004 it was 24% on a Balance balance of Payment payments (BOP) basis. Given the continued momentum , amounted to one fifth of world exports of services in 1980, they had risen to over a quarter by 2000 to reach around one-third in recent years. BOP data show that trade in services represents between 20 and 25% of global trade in goods and services. However, these data on international transactions do not cover services delivered via foreign affiliates (i.e. mainly referring to mode 3 supply of services). Total international supply of services is therefore considered to be significantly larger than BOP figures indicate. Taking into account data derived from Foreign affiliates statistics (FATS), it is estimated that actual global trade in services is at least twice as high as the figure derived from BOP statistics. At the same time, new data on trade measured in value added terms highlight the importance of services, in particular locally sourced services, in global value chains. Estimates show that in value added terms, locally sourced services, whether exported as services or integrated in goods traded, represent about half of the total value of world trade, the need for internationally recognized rules became increasingly pressing.
Appears in 1 contract
Samples: General Agreement
Historical Background. The General Agreement on Trade in Services (GATS) is the first multilateral trade agreement to cover trade in services. Its creation was one of the major achievements of the Uruguay Round of trade negotiations, from 1986 to 1993. This was almost half a century after the entry into force of the General Agreement on Tariffs and Trade (GATT) of 1947, the GATS' counterpart in merchandise trade. The need for a trade agreement in services has long been questioned. Large segments of the services economy, from hotels and restaurants to personal services, have traditionally been considered as domestic activities that do not lend themselves to the application of trade policy concepts and instruments. Other sectors, from rail transport to telecommunications, have been viewed as classical domains of government ownership and control, given their infrastructural importance and the perceived existence, in some cases, of natural monopoly situations. A third important group of sectors, including health, education and basic insurance services, are considered in many countries as governmental responsibilities, given reflecting their importance for social integration and regional cohesion, which should be tightly regulated and not be left to the rough and tumble of markets. Nevertheless, some services sectors, in particular international finance and maritime transport, have been largely open for centuries - as the natural complements to merchandise trade. Other large sectors have undergone fundamental technical and regulatory changes in recent decades, opening them to private commercial participation and reducing, even eliminating, existing barriers to entry. The emergence of the Internet has helped to create a range of internationally tradeable tradable product variants - from e-banking to tele-health and distance learning - that were unknown only two decades ago, and has removed distance-related barriers to trade that had disadvantaged suppliers and users in remote locations (relevant areas include professional services such as software development, consultancy and advisory services, etc.). A growing number of governments has gradually exposed previous monopoly domains to competition; telecommunication is a case in point. This reflects a basic change in attitudes. The traditional (monopoly) framework of public service increasingly proved inappropriate for operating some of the most dynamic and innovative segments of the economy, and governments apparently lacked the entrepreneurial spirit and financial resources to exploit fully existing growth potential. Services have recently become the most dynamic segment of international trade. Since 1980, world services trade has grown faster, albeit from a relatively modest basis, than merchandise flows. Defying wide-spread misconceptions, developing countries have strongly participated in that growth. Whereas in 1980 their share of world services exports amounted to 20%exports, in 2004 it was 24% on a Balance of Payment Payments (BOP) basis, amounted to about 20% in 1980, it had risen to 24.5% by 2000 to reach 31% in 2010. And this share would be far higher, in the order of 50%, if world trade was measured in net terms, disregarding imported content and considering only the value added (and traded) by individual economies. Given the continued momentum of world services trade, as a result, not least, of the proliferation of international supply chains, the need for internationally recognized rules became increasingly pressingevident.
Appears in 1 contract
Samples: General Agreement
