Brussels, 15/02/2013 (Agence Europe) - The European Commission is asking for the European Council's green light to negotiate an international agreement on services with 21 WTO countries. The agreement would circumvent the gridlock of the Doha round.
On Friday 15 February, the Commission formally asked the Council for its approval to launch negotiations on a new international agreement on trade in services. To begin with, 21 members of the WTO - Australia, Canada, Chile, Chinese Taipei, Colombia, Costa Rica, European Union, Hong Kong, Iceland, Israel, Japan, Korea, Mexico, New Zealand, Norway, Pakistan, Panama, Peru, Switzerland, Turkey and the United States - will take part in the negotiations, which will begin in the spring. However, the door is also open to other WTO members that want to take part - the idea being that the agreement dovetails with WTO rules so it can later be integrated into the WTO system, a press release states. In the exploratory talks ahead of the launch of the negotiations, the EU has advocated shaping the future agreement in a way that makes it compatible with the WTO general agreement on trade in services (GATS). “The perspective of a new broad-based trade in services agreement is excellent news - for jobs and for economic growth. I encourage all WTO members who support market opening and strong rules for trade in services to join this initiative”, said European Commissioner for Trade Karel De Gucht.
The negotiations will focus on all services sectors, including information and communication technology (ICT), logistics and transport, financial services and services to business. However, the objective of the future plurilateral agreement goes beyond simply further opening up markets for services. It is also to develop new rules on trade in services, such as those applying to government procurement of services, licensing procedures or access to communication networks, the Commission states.
Together, the 21 initial WTO members participating in the negotiations represent more than two-thirds of world trade in services. Trade in services is of strategic importance for the EU - the sector accounting for three-quarters of EU gross domestic product and jobs. Within the EU, cross-border trade in services accounts for about 30% of EU trade, and foreign direct investment in services represents around 70% of the EU's FDI flows and around 60% of its FDI stock.
According to the Peterson Institute for International Economics, an agreement of this kind may increase service exports within a hardcore of countries by $78 billion a year. The United States and the EU would be the main beneficiaries, with gains of $14 billion and $21 billion respectively. If Brazil, China and India joined, the commercial gain could increase by some 30%. (EH/transl.fl)