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II. The Initial GATS Negotiations Process
3. Initially, some members wanted negotiations on services and agriculture to be dealt with at a similar pace. However, negotiations on services have, in effect, advanced more quickly than those on agriculture, and countries exporting agricultural products have since abandoned their demands for a strict correspondence between the two negotiation time frames. Indirectly, negotiations on services have thus become the impetus behind not only the debates on agriculture but also the adoption of a new wider programme of work for the WTO, culminating at Doha.
4. All the WTO members have made specific commitments with regard to trade in services. In accordance with Article XIX of the GATS, these specific commitments were either negotiated during the Uruguay Round, during subsequent additional negotiations carried out in some sectors - like basic telecommunications or financial services - , or indeed, for the most recent members, during the actual accession process. Negotiating these specific commitments has enabled all members to modulate not only their level of obligation sector by sector, but also the mode of supply for each service concerned [Note 2], including which restrictions governing market access and national treatment to retain. Within the framework of these negotiations, Article IV of the GATS decrees that increasing participation in world trade of developing country members be facilitated through specific negotiated commitments. These specific commitments relate to strengthening the domestic services capacity of developing countries or to liberalising market access to sectors and modes of supply of export interest to developing countries. Article IV places special priority on least-developed countries (LDCs).
5. The negotiations on services allowed for under Article XIX of the GATS have a broad mandate. This article states that negotiations should be conducted with a view to achieving a progressively higher level of liberalisation. This process aims to promote the interests of all participants on a mutually advantageous basis and to secure an overall balance of rights and obligations. Article XIX also sets forth that the process of liberalisation shall take place with due respect for national policy objectives and the level of development of individual members, both overall and in individual sectors. Furthermore, it allows individual developing country members appropriate flexibility 'for opening fewer sectors, liberalising fewer types of transactions' and 'progressively extending market access' according to their development situation.
6. Negotiating guidelines and procedures. According to Article XIX, the Council for Trade in Services (CTS) must, firstly, establish guidelines and procedures for organising negotiations. The CTS met this objective on 29 March 2001 [Note 3] when it adopted a document containing guidelines and procedures for forthcoming negotiations [Note 4]. These are the salient points:
7. As well as discussing the guidelines and procedures for negotiations, the CTS has simultaneously developed guidelines for establishing lists of specific commitments within the framework of the GATS [Note 6]. These are based on the procedures used in the Uruguay Round [Note 7] and on the experience gained during additional negotiations, since carried out in other sectors - financial services, basic telecommunications, maritime transport, etc. The document containing the guidelines explains how specific commitments should be presented in the lists. It specifies which details are required to make these clear and precise. In addition, the document shows members how to construct lists and, to facilitate the task, annexes a whole series of relevant documents (notes from various working parties with details of how to draw up lists for sectors such as basic telecommunication or accountancy services, for example). All these explanations are illustrated with precise examples.
8. The guidelines and procedures adopted by the CTS will need to be carefully analysed by all developing countries and in particular by those who joined the WTO after the Uruguay Round. Mastering the technique for preparing and interpreting the lists of commitments is undeniably of great advantage to any member in the current negotiations. This mastery is not accessible to the un-initiated, owing to the abstract nature and advanced level of legal sophistication behind the lists of specific commitments. Insofar as commitment lists will henceforth constitute the heart of negotiations on services, it is now critical that all developing countries meet the required standard.
9. Since the adoption last March of guidelines for negotiations (S/L/93) and for establishing lists of specific commitments (S/L/92), the work of the CTS has concentrated on the actual content of these negotiations. Members have presented an important number of submissions, both on horizontal and on sectoral issues. The vast majority of these submissions originated from developed countries and participation from LDCs has remained very limited [Note 8]. We will consider sectoral and horizontal proposals in quick succession.
10. Services were, by no means, the most controversial issue under negotiation at Doha, among others agriculture, TRIPS and public health, implementation, and the Singapore questions. This is because the guidelines for negotiations in this area had been agreed beforehand. The Ministerial Declaration contains only one paragraph (para 15) on services. This reaffirms that the guidelines and procedures must be the basis for continuing the negotiations and stipulates that initial requests for specific commitments be submitted by 30 June 2002 at the latest and initial offers by 31 March 2003.
11. Since negotiations began nearly two years ago, some developing countries, and in particular LDCs, have been relegated to the margins of the process. To end this situation and prepare themselves to participate in an appropriate manner, they now need to determine what their interests in these negotiations are. An analysis can and should be carried out on several fronts. A first step is obviously to assess trade in services as per Article XIX (see para 6). A group of developing countries - including two LDCs [Note 23] - recently underlined the importance of this, stating that the process in its present form was inadequate and that negotiations should not continue until this assessment is finalised.
12. However, the absence of accurate and reliable statistics on the trade in services in most countries makes it unlikely that this exercise can be taken much further than the point it has already reached. Therefore it would be pertinent that the analysis be completed with two further important steps. First of all to identify within the specific commitments of the target markets any obstacles that significantly hamper the member's export of services. This analysis should start with those sectors which present strong export potential for the member country. Secondly, members would also be advised to attempt to identify within their own specific commitments, any limitations to market access and to national treatment that are to their disadvantage and therefore have a negative effect on their own economy. This analysis will be crucial for the next stages in the negotiations, during which each member will have to present requests and offers to economic partners. It should be possible for increased technical and financial assistance to be made available to prepare more effectively for this part of the negotiation, as has already been requested by some developing countries.
13. The CTS met for four days during the week commencing 3-7 December 2001 in order to consider the submissions received to date, both on horizontal and sectoral issues (see para 9). The subsequent meeting is scheduled for March 2002, for an update on the progress in negotiations. Given the participation problems outlined above, these meetings will take on a great deal of importance for developing countries.
Note 1: One year after the Marrakech Agreements (1995) came into force, setting up the WTO and putting together the results of the Uruguay Round, the members of the Organisation, in the knowledge that many elements of the multilateral trading system had still to be negotiated, discussed or improved, decided that the activities of the Organisation required a more rigorous structure and planning. This became known as the Built-in Agenda. See AITIC Brief Information Note on the WTO Built-in Agenda, 28 July 2000, available on AITIC's website (www.aitic.org). (return to text)
Note 2: Indeed, this agreement distinguishes between cross-border trade ('Mode 1'), consumption abroad ('Mode 2'), commercial presence ('Mode 3') and the movement of natural persons ('Mode 4'). (return to text)
Note 3: See document S/L/93. (return to text)
Note 4: The adopted guidelines bear a strong resemblance to the proposal by a group of developing countries, the G-24: Argentina, Brazil, Cuba, El Salvador, Honduras, India, Indonesia, Malaysia, Mexico, Nicaragua, Pakistan, Panama, Paraguay, the Philippines, the Dominican Republic, Sri Lanka, Thailand, Uruguay, the members of the Andean Community (Bolivia, Colombia, Ecuador, Peru and Venezuela) and Guatemala. The African Group and the members of CARICOM also supported the proposal. (return to text)
Note 5: Contained in documents S/C/W/37 /38 /39 /40 /43 /44 /45 /46 /47 /49 /50 /51 /52 /59 /60 /61 /62. Document S/C/W/65, dated 6 November 1998, groups together all these notes. (return to text)
Note 6: See WTO document S/L/92, 28 March 2001. (return to text)
Note 7: See documents MTN.GNS/W/164 and 164/Add1 of 1993. These documents cannot be found on the WTO website but are referred to in document S/L/92 as being the first guidelines produced by the WTO Secretariat relating to the registration of lists of commitments. (return to text)
Note 8: One of the submissions involving two LDCs was that forwarded by Cuba, Haiti, India, Kenya, Uganda, Pakistan, Peru, the Dominican Republic, Venezuela and Zimbabwe: S/CSS/W/114. (return to text)Note 9: See documents S/CSS/W/107 (Bolivia, Ecuador, El Salvador, Honduras, Nicaragua, Panama, the Dominican Republic) and S/CSS/W/109 (Kenya). (return to text)
Note 10: See documents S/CSS/W/69 from Venezuela and S/CSS/W/88 from Chile. (return to text)
Note 11: See document S/CSS/W/95 (MERCOSUR). It is generally recognised that India has an advantage in this area, but has yet to present a submission. (return to text)
Note 12: See document S/CSS/W/88 (Chile). (return to text)
Note 13: See documents S/CSS/W/109 (Kenya), S/CSS/W/88 (Chile) and S/CSS/W/113 (Brazil). (return to text)
Note 14: See documents S/CSS/W/98 (Colombia), S/CSS/W/109 (Kenya) and S/CSS/W/88 (Chile). (return to text)
Note 15: See documents S/CSS/W/80 (MERCOSUR) and S/CSS/W/88 (Chile). (return to text)
Note 16: See document S/CSS/W/88 (Chile). (return to text)
Note 17: See document S/CSS/W/119 (Colombia). (return to text)
Note 18: See documents S/CSS/W/96 (Colombia) and S/CSS/W/109 (Kenya). (return to text)
Note 19: See documents S/CSS/W/12 (India), C/CSS/W/88 (Chile), C/CSS/W/109 (Kenya) and C/SCS/W/97 (Colombia). (return to text)
Note 20: Document S/L/64 adopted on 14 December 1998. (return to text)
Note 21: Document S/WPGR/W/30 of 14 March 2000. (return to text)
Note 22: Document S/WPRG/W/37 of 2 October 2001. (return to text)
Note 23: See document: S/CSS/W/114 (Cuba, Haiti, India, Kenya, Uganda, Pakistan, Peru, the Dominican Republic, Venezuela and Zimbabwe), cited above. (return to text)