Source:
CADTM
Developing country governments have been rightly concerned about agreeing to texts which promise illusory reductions in agricultural subsidies in the European Union and United States and require them to cut their industrial tariffs proportionally more than the developed countries. They should also not allow themselves to be snookered into a bad agreement on services. July 2008.
[see more]
The General Agreement on Trade in Services (GATS) is one of the most comprehensive agreements of the World Trade Organization (WTO). Its aim is to increasingly liberalize "trade in services" among WTO members.
The GATS came into force in January 1995, but negotiations officially began in early 2000. In March 2001, the Trade in Services Council set out the Guidelines and Procedures for Negotiations. The Declaration of the Doha Ministerial Conference (November 2001) backed the efforts conducted thus far, endorsed the guidelines and procedures for negotiations, and set a deadline to close negotiations: 1 January 2005.
Trade in services is defined broadly to include direct foreign investment in services such as health, education, water, pensions, and transportation. Liberalization means, among other things, eliminating any government policies whereby national providers are favored over foreign ones, such as, for example, preferential public subsidies. Significantly, it also involves eradicating state monopolies, as well as deregulation whenever a norm is considered too onerous for foreign investors and service providers.
WTO leaders have denied claims that the GATS would lead to privatization of public services. They supported this statement by pointing to a provision that stipulates that the GATS is not applicable to services "rendered in the exercise of governmental authority" and other examples of the wording of the GATS that protect a government’s right to regulate. But the wording offers little consolation to those alarmed by its potentially limiting effect on government regulation and policies. Industrial lobbyists of the North are making no attempts to disguise their intention of seeking urban infrastructure markets in the developing world. Then again, it’s the small print that tells the real story.
A critical issue in this debate is that all the key terms of the agreement are left undefined and will only be determined by WTO dispute resolution panels. Consequently, any claim that the GATS protects public services must be met at least with some skepticism.
The civil society of the South believes that the trade regulations and negotiations included in the GATS must undergo a radical transformation if they are to benefit the world’s poorest citizens. The GATS, it is argued, is not a ‘development-friendly’ agreement, as its advocates maintain, but rather an instrument wielded by the industrialized world to steadily curb the chances of development of the poorest countries, through successive rounds of negotiations.
The current services negotiations at the WTO have also led to fears that countries could be pressurized into commitments that will limit the ability of governments to regulate and ensure affordable and equitable access to essential services: it is unrealistic to expect profit-seeking private companies operating under market forces to meet the needs of the less lucrative groups of the population. This is partly because it is hard – particularly for governments that are not strong– to regulate a powerful private sector and partly because making commitments to allow foreign service providers access to the domestic market can reduce the scope a government has to regulate in the public interest (known in trade-related jargon as policy space).
Moreover, the bilateral format gives more scope than multilateral fora for arm-twisting by powerful countries, to persuade smaller countries to open more service sectors to international competition. A 2002 study by the Commonwealth Secretariat found that newly acceded WTO Members, all of which are developing countries, were pressurized to open more service sectors during accession negotiations.
According to a paper by the United Nations Conference on Trade and Development (UNCTAD) secretariat, prepared for the Commission on Trade in Goods and Services and Commodities on March 2005, services negotiations in the WTO have so far not attained an overall balance of rights and obligations, the increase in developing countries' service exports has been small, and the initial offers by major trading partners has been disappointing for developing countries. The paper says that the assessment of trade in services continues to be a main concern for developing countries, as lack of assessment and information is a main impediment to their more active participation in the services negotiations.
Ranging from architecture to voice-mail telecommunications and to space transport, services are the largest and most dynamic component of both developed and developing country economies. Their inclusion in the Uruguay Round of trade negotiations led to the General Agreement on Trade in Services (GATS). Since January 2000, they have become the subject of multilateral trade negotiations.
Negotiations on services were already almost two years old when they were incorporated into the new Doha agenda (November 2001). The Doha Declaration endorses the work already done, reaffirms the negotiating guidelines and procedures, and establishes some key elements of the timetable including, most importantly, the deadline for the conclusion of the negotiations as part of a single undertaking.
The Compendium of Provisions on Trade in Services in the Trade and Integration Arrangements of the Western Hemisphere contains information on provisions relating to services in nine trade and integration arrangements in the Western Hemisphere in Part I, information on service sectors which form separate chapters of these agreements and arrangements in Part III, and information on the provisions relating to services contained in five bilateral free trade agreements and four Economic Complementation Agreements in Part II. All of the 34 participants in the Free Trade Area of the Americas (FTAA) process, except for Haiti, are covered by one or more of the arrangements examined.
In its essence, GATS is intended to enforce the speedy liberalization of hitherto public domains. In its push to broaden the definition of a service, and to get rid of ‘burdensome’ governmental regulations, it promises to cut down the remaining barriers between private finance and the public sector.
The newly launched TNI Yearbook on Public Services provides an overview of the state of public services around the world. It covers national and international policy developments from January to December 2005, as well as analyses the recent history of the present situation and provides a prognosis for the near future. February 2006.
US and EU are pushing for sectoral/plurilateral negotiations to be launched after the Hong Kong Ministerial. This mechanism aims to liberalise a sector by negotiating amongst a critical mass of countries knocking together an ambitious framework of rules that will then be bound in international law by the World Trade Organization (WTO). The sectors include energy, distribution, finance, transport, computer services and postal services. December 2005.
The UK government is giving away millions of pounds from the UK aid budget to privatization consultants engaged to ‘advise’ developing countries on handing over their public services to the private sector, according to a new report from anti-poverty charity War on Want. October 2004.
Under the terms of the Free Trade Area of the Americas (FTAA) treaty and the General Agreement on Trade in Services (GATS) now being negotiated, governments will no longer be able to oblige foreign investors to purchase locally, transfer technology, take local partners or train local workers. Citing this and other treaty provisions, “Divide and Conquer,” a new study prepared by Scott Sinclair and Ken Traynor for PSI, shows that the pending treaties dramatically reduce the sovereignty of governments and their ability to regulate in the public interest. January 2005 (pdf version).
WTO negotiations on General Agreement on Trade in Services (GATS) are threatening essential public services—including water—throughout the world. In the current negotiations, which were launched in November 2001, governments are pressuring each other to open up services to private sector and non-profit (NGO) providers, even in socially sensitive areas such as water, health and education. The GATS could undermine progress toward social and environmental goals because it limits the ability of governments to regulate or provide services. For instance, it could jeopardize access to water and other services by poor and vulnerable groups. 2003.
One of the most dramatic developments within higher education in recent years has been the rapid expansion of the "international trade" in education services. October 2006.
Education International insists that education is a human right and it is the responsibility of all governments to provide all women and men, boys and girls, free quality public education. In recent years, EI is concerned that proposals for a significant increase in the scope of, and degree of, liberalisation of trade, might cover education services. EI's central objective is to have education excluded from the scope of the General Agreement on Trade in Services (GATS).
In this statement, launched on August 2003, organizations related to education demand WTO member countries to take a set of measures in order to take education out of GATS.
Many aspects of GATS are open to interpretation, and many nations have yet to fully engage in the process, at least in respect of the potential implications for education. By Jane Knight (University of Toronto). March 2002 (pdf version).
This paper addresses some of the public policy controversies surrounding the treatment of education services under the GATS. November 2002 (pdf version).
GATS aims to remove 'barriers to trade' in services, which could involve removing laws protecting the planet, public health and local communities, according to Friends of the Earth.
Forty developing countries and 32 less-developed countries are being told to open up their finance, energy, environment, water, tourism, distribution and transportation services to foreign market forces. This joint statement of several trade unions and NGOs calls on WTO delegations in Geneva to reconsider their role in the current GATS negotiations if they do not proceed on more development-friendly terms. June 2005.
This document is a chapter of the Practical Guide to the WTO for Human Rights Advocates, published by 3D and FORUM-ASIA in December 2004 (pdf version).
IGTN opposes the trade of services essential to social reproduction, services that are fundamental to the care economy for which women around the world are primarily responsible.
Service workers all over the world are feeling the effects of profound structural changes. Many of those changes are being propelled by international trade agreements, most notably the GATS and its follow-on agreements in telecommunications and financial services.
Statements, news and updates from organizations, activists and social movements worldwide fighting corporate globalization embodied in global trading system.
As the world is still assessing one of the most violent shocks in international financial markets ever, and measures to avoid future financial crises are still not in place, developing countries should be cautious of dangers associated with further liberalisation of their financial sectors. June 2008.
Profit is the purpose of private enterprise and gain is the measure of its success in any activity. Profit is legitimate when there is a transparent market, without distortions and open to competition, and is usually beneficial to the general interest. This benefit, that is an externality to the main goal, are lower prices in products and better quality. In public services, success is measured in range and quality. March 2007 (pdf version).
Developing country governments have been rightly concerned about agreeing to texts which promise illusory reductions in agricultural subsidies in the European Union and United States and require them to cut their industrial tariffs proportionally more than the developed countries. They should also not allow themselves to be snookered into a bad agreement on services. July 2008.
Domestic regulation has been a contentious subject in negotiations on international trade in services since the preparations for the Uruguay Round in the early 1980s. According to the Punta del Este Declaration the multilateral framework to be negotiated was to "respect policy objectives of national laws and regulations applying to services". Among developing countries reticence concerning this framework centred on potential conflicts between the principles of progressive liberalization, transparency and non-discrimination, on the one hand, and policy autonomy regarding the establishment of regulations required by their development objectives, on the other. April 2008.
Developing countries should be aware of the implications of the WTO dispute settlement reports on US (Gambling) and Mexico (Telecommunications) as they continue participating in the WTO negotiations. The findings in the reports have set precedents on the interpretation of various GATS articles and concepts, including: necessity tests; Article XIV on General Exception; Article IV on Increasing Participation of Developing Countries; and scheduling guidelines. February 2007 (pdf version).
The U.S. Coalition of Service Industries was the top lobby group in the November 2001 WTO meeting in Qatar. This table looks at 12 heavy hitters in the 67 member Coalition.
The IMF and World Bank pressure developing countries in many ways that undercut their positions in trade negotiations. This brief focuses only on the misleading claims of the institutions as to the levels of trade-related policy conditions associated with their operations. It concludes with suggestions relating to negotiations on trade in services. November 2005 (pdf version).
The plurilateral negotiations that were launched on 28 February by the major developed countries (joined by a handful of developing countries) are clearly aimed at creating a new negotiating method to more effectively pressurize some emerging developing economies to open up many of their key services sectors to competition from the large multinational service enterprises. March 2006.
Developed countries have launched a joint offensive to introduce new methods of getting developing countries to commit themselves to liberalising their services sectors in the WTO, and to have these endorsed at the WTO's Ministerial conference in Hong Kong in December. The offensive came at an informal meeting on 13 September of the WTO's Council for Trade in Services in Special Session. September 2005.
According to the European Commission, the General Agreement on Trade in Services (GATS) is “not just something that exists between Governments” but “… first and foremost an instrument for the benefit of business.” That is not by accident. The 1994 GATS agreement would never have come into being without almost twenty years of intense lobbying by the US services industry. The current negotiations to expand and deepen the scope of the GATS seem to be primarily driven by the European Commission, working in close cooperation with European services companies.
The Special Session of the WTO Council for Trade in Services (CTS), where the services negotiations are taking place, agreed on 6 March 2003 to modalities for the treatment of autonomous liberalization in services.
The process of liberalization of the services sector has so far weighed heavily in favour of the developed countries. In order to redress this imbalance in the new round of upcoming talks in the services sector, developing countries should not undertake any further commitments on liberalisation and the developed countries should liberalise the sectors of export interest to the developing countries. July 2000.
The new round of negotiations at the WTO/GATS for liberalization of trade in services, and the modalities being pushed by the major industrialized countries - whether for clustering, or a formula approach or for horizontal modalities are aimed at leveraging greater GATS coverage for the benefit of TNCs, and reducing ability of governments in countries to interfere for public purposes. October 2000.
Trade negotiators from member countries have been secretly developing their detailed lists of 'requests' (or demands) for service markets - often with the explicit input of transnational service corporations that want access to other country markets. February 2003.
While there has been huge concern about the European Union's push for new investment rules in the WTO, the investment element of the on-going GATS negotiations are yet to generate such opposition. Meanwhile, in their post-Cancun negotiating objectives, the EU and the US (in alliance with key industry allies), have made their ambitions in the services negotiations very clear. Evidence from industry documents indicates that increased pressure will be exerted on countries to ratchet up their participation in the current talks. The paper argues that the EU's proposals for a separate agreement covering investment has only ever been one part of their investment agenda. The other key aspect is the General Agreement on Trade in Services (GATS) whose rules apply to companies setting up operations in other countries. February 2004 (pdf version).
A joint submission by EQUINET, International People's Health Council, Medact, People’s Health Movement, Wemos and World Development Movement, to the World Health Assembly, May 2003 (pdf version).
This note provides background on the treatment of health insurance services by the General Agreement on Trade in Services (GATS) of the World Trade Organization, and explains the relevance of current GATS negotiations for health insurance trade. June 2001 (pdf version).
In an era of unprecedented global wealth, millions of children across the world are facing a health crisis. The WTO's GATS poses its own challenges to children's right to health. January 2001 (pdf version).
The WTO-administered General Agreement on Trade in Services (GATS) poses an increasingly serious threat to the sustainable and equitable management of scarce water resources globally, and in developing countries in particular. The GATS is the first ever multilateral, legally enforceable set of rules to cover a wide array of services, ranging from business related services to water supply and sanitation services. March 2006 (pdf version).
This booklet describes the main rationales for using the private sector to deliver water, sanitation and electricity services, and evaluates them in theory and in practice. It also identifies policy trends and the major policy instruments used by multilateral organizations to promote private provision in these sectors. It concludes with recommendations for assessing the feasibility of private provision.
This briefing examines the challenges raised by GATS in the water sector, which has been one of the most contentious aspects of the GATS liberalization programme. April 2003.
This December 2005 in Hong Kong, the highest policy making body of the World Trade Organization (WTO) is meeting for the sixth time. Among the central issues to be put on the table of discussions and negotiations is the General Agreement on Trade in Services (GATS), which is part of the unfinished agenda of the developed countries of the North in past WTO meetings. GATS has come to be understood by people’s movements, especially from countries of the South, as a far-reaching instrument of neoliberal globalization that threatens the freedoms, the very survival and future of peoples. December 2005 (pdf version).
Guide to the GATS and the key features of the multilateral system of trade covering services – examines the rights and benefits conferred and obligations imposed by GATS on the business community and governments; implications for developing countries and economies in transition; identifies main opportunities and challenges encountered at the practical business level in the implementation of GATS rules and market access commitments.
