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Workshop highlights GATS dangers for developing countries

published 12 November 2009 updated 12 November 2009

Developing countries need to approach current negotiations aimed at liberalizing the trade in services with caution, a high level seminar has concluded.

The workshop, organized on October 1 by the Geneva-based South Centre, brought together negotiators and international experts to discuss the key issues at play in the WTO’s GATS negotiations.

Jose Victor Chan-Gonzaga from the Permanent Mission of Philippines provided delegates with an overview of the state of services negotiations.

“The overall picture is that there has been very little movement in the past three years in terms of what’s on the table,” Chan-Gonzaga reported. “There’s been varying degrees of progress on rules issues and on domestic regulation, but nothing is likely to really get moving until the agricultural and industrial tariff issues are sorted out.”

Chan-Gonzaga also warned that there have been “subtle but persistent attempts by demandeurs to weaken the flexibilities of the GATS” which could impose serious limitations on developing countries.

Panellists also discussed the rules being developed for domestic regulations with respect to qualifications requirements and procedures, licensing requirements and procedures, and technical standards. A draft text of the proposed rules would require that WTO members ensure that their regulations are objective, relevant, pre-determined, and “not a disguised barrier to trade.”

Education International’s Trade Consultant, David Robinson, was invited to present on the impact of the proposed rules on education regulations. Robinson pointed out that there are ambiguities in the key operational terms in the draft that, depending upon how they are ultimately defined, could severely restrict domestic policy space.

“For instance, the requirement that regulations be ‘objective’ could be defined along a continuum of meanings -- from reasonable, not arbitrary, relevant, not subjective, to least trade restrictive,” he explained. “Justifying regulatory measures as ‘reasonable’ is a far easier task than showing they are ‘not subjective’ or are ‘least trade restrictive’.”

Robinson noted that many regulations regarding the accreditation of schools are by their nature subjective. Institutions are often required to show a commitment to ‘intellectual diversity’ or ‘academic freedom’ or to be in the public interest or the interest of the academic community.

“In other words, legitimate regulations are often based on subjective judgments about the quality of a service.”

Robinson argued that developing countries should press for a less intrusive understanding of the key requirements in the draft disciplines in order to preserve their policy space.

“Rules and regulations are developed through compromises that are neither the most nor the least trade restrictive on service providers. Requiring all regulations to be the least trade restrictive would limit both the content and the process for democratic decision-making.”