What Is General Agreement On Trade In Services

This definition defines virtually all public services as “provided on a commercial basis” and already extends to areas such as the police, military, prisons, judiciary, public administration and government. From a relatively short time perspective, this could open up to the privatization or commercialization of large parts and possibly all public services that are now considered public services that are currently available to the entire population of a country as social rights, restructured, marketed, allocated to for-profit providers and ultimately fully privatized and made available to them, who can pay for it. This process is currently well advanced in most countries, usually (and intentionally) without properly informing or consulting the public to find out whether this is what they want or not. While national governments have the option of excluding certain services from liberalization under the GATS, they are also under pressure from international trade interests not to exclude services provided “on a commercial basis”. Important utilities such as water and electricity typically involve purchase by consumers and are therefore clearly “provided on a commercial basis”. The same goes for many health and education services that are supposed to be “exported” by some countries as profitable industries. [6] The most-favoured-nation regime ensures that each signatory country treats the services of one Member State without distinction and no less favourably than those of another country under the conditions and within the limits set out in the list of specific obligations. You can find more information on trade in services in our report on services and Brexit and more information on the WTO in our report on the WTO. With a few exceptions, the GATS covers all services. The list of service sectors and subsectors covered is included in the list of sectoral classifications of services. The existence of specific commitments triggers other obligations, including the notification of new measures with a significant impact on trade and the avoidance of restrictions on international payments and credit transfers. The presentation of the present report is structured as follows: section II deals with general principles and obligations, including dispute settlement and institutional rules.

Section III analyses the specific sectoral provisions of annexes, decisions, declarations and agreements on a sectoral basis. Sections IV and V contain some brief comments on the longest engagement plans and lists of compensation exemptions, respectively. While services currently account for more than two-thirds of global output and employment, they account for no more than 25% of total trade as measured on a balance of payments basis. However, this share – apparently modest – should not be underestimated. In fact, balance of payments statistics do not cover any of the types of service provision defined in the GATS, i.e. supply by commercial presence in another country (mode 3). Moreover, even though services are increasingly traded themselves, they are also crucial inputs for the production of goods and, therefore, services account for about 50% of global trade in terms of value creation. .

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