ISTIA SLIDESHOW - Whither GATS
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Transcript of ISTIA SLIDESHOW - Whither GATS
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
ISTIA
WHITHER GATS?WHITHER GATS?CouldCould Services Trade Services Trade StatisticsStatistics Be the Be the ReasonReason thatthat
GATS GATS NegotiationsNegotiations are are StalledStalled??
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
WHITHER GATS?MOST WTO MEMBERS DONT HAVE USEFUL SERVICES TRADE STATISTICS
Could this be why the negotiations are not moving as quickly?
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
WHAT KIND of TRADEWHAT KIND of TRADE--inin--SERVICES SERVICES STATISTICS ARE NEEDEDSTATISTICS ARE NEEDED ??
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
SERVICES TRADE INFORMATIONWHAT IS CURRENTLY AVAILABLE?
YESYEScrosscross--borderborderservices services tradetrade
statisticsstatistics
NO
NO
NO
MODE 4MODE 4Movement of Movement of
Natural PersonsNatural Persons
NO
NO
NO
MODE 2MODE 2ConsumConsumptionption
abroadabroad
YESYESbutbut SPARSESPARSE
YES YES butbut onlyonly for for
OECDOECD
NO
FOREIGN FOREIGN
AFFILIATE TRADE AFFILIATE TRADE
STATISTICSSTATISTICS
FOREIGN DIRECT FOREIGN DIRECT
INVESTMENTINVESTMENT
YESYESCOMPREHENSIVECOMPREHENSIVE
FDI establishment statistics FDI establishment statistics & Financial and operating & Financial and operating
data of FDI data of FDI enterprisesenterprises
National accounts, National accounts, afterafter
IISSTTIIAATechnical Assistance & Technical Assistance &
Capacity BuildingCapacity Building
YESYESbutbut SPARSESPARSE
YES butYES but SPARSE SPARSE �� based on IMF based on IMF
data and national data and national sourcessources
UNCTADUNCTAD
YES YES butbut only for only for
OECDOECD
YES YES butbut onlyonly for OECDfor OECD
OECDOECD
YES butYES but FDI FDI doesdoesnot not disaggregatedisaggregate
services services fromfromgoodsgoods & sectoral & sectoral diaggregationdiaggregation poorpoor
YESYESbut but sectoral sectoral
disaggregationdisaggregation for for developingdeveloping countries countries isis
veryvery poorpoor
IMFIMF
MODE 3MODE 3Commercial presenceCommercial presence
MODE 1MODE 1CrossCross--border supplyborder supply
SOURCE
YESYEScrosscross--borderborder
services services tradetrade statisticsstatistics
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
SERVICES TRADE INFORMATIONWHY IS THIS A PROBLEM?
��During the course of the Uruguay Round it was impossible for During the course of the Uruguay Round it was impossible for services negotiators to judge the value of the services negotiators to judge the value of the liberalisationliberalisation offers offers made by their trading partners either individually or collectivmade by their trading partners either individually or collectively.ely.��United Nations Expert Meeting on International Standards in Statistics on Trade in Services, November 2000; Statement of Opinion by Mr. Alister Abercrombie, British Invisibles, U.K.
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
��In the GATS context, In the GATS context, ��.we .we encounter a crucial problem: encounter a crucial problem: the framework of negotiated the framework of negotiated commitments commitments does not matchdoes not matchthe existing structure of trade the existing structure of trade statisticsstatistics�� WTO (1995), S/C/W/5, paragraph 24.
WTO Secretariat Studies, 1995
��the problems relating to the availability and comparability of the problems relating to the availability and comparability of statistics were the statistics were the most serious and required urgent attentionmost serious and required urgent attention ��
WTO (1995) S/C/M/2, paragraph 29.
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
During the Uruguay RoundDuring the Uruguay Rounddeveloping country contracting developing country contracting parties expressed concerns aboutparties expressed concerns aboutthe lackthe lack--ofof--statistics;statistics;
Article XIX.3 of the GATS textArticle XIX.3 of the GATS textaddressed the issue by promising addressed the issue by promising that that ��assessmentassessment�� would be would be conducted on trade in services;conducted on trade in services;The First Council on Services MeetingThe First Council on Services Meeting in 1995 put this #1 on in 1995 put this #1 on the agenda, yet no effective action was taken;the agenda, yet no effective action was taken;Over 75 Official WTO or GATT MeetingsOver 75 Official WTO or GATT Meetings have made mention of have made mention of the need for technical assistance to developing countries inthe need for technical assistance to developing countries in the area the area of services trade statistics, such that they are more able tof services trade statistics, such that they are more able to accurately o accurately assess the state of trade in this area. These are accessiblassess the state of trade in this area. These are accessible online at: e online at:
http://http://www.servicestrade.orgwww.servicestrade.org
SERVICES STATISTICS CAPACITY BUILDING HAS BEEN REQUESTED MANY TIMESTHIS WORK IS DEMAND-DRIVEN
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
TheseThese cancan bebe foundfound on the ISTIA on the ISTIA WebsiteWebsite atat http://www.servicestrade.orghttp://www.servicestrade.org
SERVICES TRADE STATISTICSCapacity building needs have been discussed in over 75 official meetings
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
What is ISTIA?
� A New International Agency, Geneva-based
� Being Mandated To Provide FDI And Trade-in-services CapacityBuilding
� Works To Fulfill An Unmet Needs for Developing Countries;
� Works With National Governments To Improve Statistical Information
� Works With National Governments AndIntergovernmental Agencies To ProvideTraining on the New Data-set of Statisticsrelated to GATS and globalization in general
1. Trade-in-Services2. FDI3. FATS (FDI operations statistics)
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
Recipients of ISTIA Work
4. Universities & Economic
Think-tanks
ISTIA cooperates withacademic institutions andother competence centres tofacilitate knowledge-sharing
5. Private Sector Actors:
Businesses, Investors,
Commercial Entities
ISTIA works to educate the private sector as to the newstatistical information.
6. Inter-governmental Agencies
ISTIA works to make use of existing competencies and to share knowledge and experienceacquired with other agencies.
Need training to use the new data-setin the negotiation context - and touse the statistical information witha view towards understanding therelationship of statistics to realbusiness operations � so that servicescommitments have a meaning & context.
Central Banks, Ministries of Finance, Ministries of Investment and NationalStatistical Agencies need assistancein designing, and implementing aCountry-specific strategy to improveTrade in services and FDI statistics viaEnterprise Surveys
Need assistance to comprehendthe new data-set and to be betterable to use the statisticsfor evidence-based policymaking
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
WHAT KIND OF SERVICES STATISTICS ARE WHAT KIND OF SERVICES STATISTICS ARE NEEDED BY DEVELOPING COUNTRIES?NEEDED BY DEVELOPING COUNTRIES?
TradeTrade--inin--Services Statistics that Services Statistics that AddressAddress::
1. GATS Four Modes Of Supplyof Services delivery. Without this, theWTO legal framework is not correctlyaddressed by statistical measures.
2. Sectoral MeasurementCurrent means of measurement don�t measure most of the sectors addressed by GATS negotiations, such as telecommsconsulting, legal services & others that arecrucial for effective negotiating. Ideally, the WTO �120 list� would be used in sectoral definitions, as it is the most specific set of definitions.
3. Services as �Products� as does the GATS Legal Framework � The GATS legal agreement treats services, in the trade context, as products. BUT trade in services statistics, as they are collected in developing countries, do not capture data in the same way as the GATS. i.e. in developing countries are collected on an industrial, not a product basis � and therefore much statistical information is not adequately captured.
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
SERVICES TRADE INFORMATIONin this context, is
� Information detailing services-sector trade-flows, betweentrading countries or economies.
� Principally national-accounts-related information (informationon cross-border financial flows, collected by national governments and reported to the International Monetary Fund)
� Two basic components (at first pass)
1. Cross-border services trade information2. Foreign-direct-investment (FDI) information (including FDI in services)
a. FDI flows and stocksb. Trade of FDI-related establishmentsc. Data concerning FDI operations
Imports, exports, sales, expenditures, profits,assets, employment, value-added produced byFDI-based enterprises.
Linkages to be drawn to the GATS Four Modes of SupplySpecial surveys designed to capture GATS Mode 4
services trade (movement on natural persons)
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
TRADE in SERVICES STATISTICSWHO IS WORKING ON IT? (and related work)
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
TheseThese data are data are alsoalso important for important for privateprivate sectorsector actorsactors,, includingincluding businesses businesses conductingconducting tradetrade andand investmentinvestment intointo and made by and made by developingdeveloping country businessescountry businesses
ISTIAISTIASeeksSeeks to "to "FillFill the Gaps"the Gaps"
��betweenbetween IMF 1993 IMF 1993 standards (SNA and SDDS)standards (SNA and SDDS)and and developingdeveloping countrycountrytradetrade negotiatornegotiator and and policymakerpolicymaker needsneeds
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
The IMF Balance of PaymentsThe IMF Balance of PaymentsCompilation guide Compilation guide recommendsrecommends TwoTwo ModalitiesModalities for collection of services for collection of services
tradetrade information as part of National information as part of National AccountsAccounts Data CollectionData Collection
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
CROSS BORDER SERVICES TRADE
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
GATS Mode 3: FDI GATS Mode 3: FDI InflowsInflowsFlowsFlows, vs. Stocks, , vs. Stocks, whatwhat dodo theythey meanmean??
TheseThese couldcould bebe enhancedenhanced forfor betterbetter accuracyaccuracy,,asas wellwell as to show as to show specificityspecificity for for sectorsector and information and information About About operationoperation of FDI of FDI enterprisesenterprises inin developingdeveloping countriescountries
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
GATS MODE 3 (Commercial Presence)REQUIRES SPECIALIZED DATA
To best understand the implications of GATS Mode 3 commitments, To best understand the implications of GATS Mode 3 commitments, one one must look at all forms of must look at all forms of ��operationsoperations�� transactions describing the transactions describing the ��activitiesactivities�� ofof ��Commercial Presence EnterprisesCommercial Presence Enterprises�� (FDI(FDI--based based subsidiaries) subsidiaries) which are also sometimes called which are also sometimes called ��foreign affiliatesforeign affiliates��
Sample transactions include:Sample transactions include: sales, purchases, employment, royalties, sales, purchases, employment, royalties, valuevalue--added, imports, exports, etc., of FDIadded, imports, exports, etc., of FDI--related enterprises.related enterprises.
These data provide information about the These data provide information about the aggregate level of business activity in a given aggregate level of business activity in a given economy that is related to such establishmentseconomy that is related to such establishments
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
soso��..WhatWhat isis FATS DATA?FATS DATA?
WRONG answer: Obesity statistics
Correct answer: « Foreign Affiliate Trade Statistics, or operations of FDI enterprises
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
Correct answer: « Foreign Affiliate Trade Statistics, or operations of FDI enterprises
FATS* data are statistics detailing the economicoperations of FDI-related enterprises (GATS Mode 3)
The U.S. The U.S. GovernmentGovernmentcollectscollects thisthis information for information for US FDIUS FDI--relatedrelated enterprisesenterprisesvisvis--aa--visvis enterpriseenterprise surveyssurveys
FATS data FATS data cancan showshow policymakerspolicymakers and and negotiatorsnegotiatorswhatwhat kindkind ofof economiceconomic effectseffectsthatthat FDI has on FDI has on theirtheireconomyeconomy (for(for inwardinward FDI)FDI)andand thatthat theirtheir outwardoutward FDIFDIhashas abroadabroad (for(for outwardoutward FDI)FDI)
**ForeignForeign AffiliateAffiliate Trade StatisticsTrade Statistics
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
**ForeignForeign AffiliateAffiliate Trade StatisticsTrade Statistics
The U.S. The U.S. GovernmentGovernment uses uses enterpriseenterprise surveyssurveys toto gathergatherrichrich national national accountsaccounts datadata
WouldWould developingdeveloping countries countries bebe interestedinterested inin suchsuch information, information, forfor itsits FDIFDI enterprisesenterprises abroadabroad? It ? It wouldwould provideprovide usefulusefulinformation information relatedrelated to GATS Mode 3to GATS Mode 3
FATS* data are statistics detailing the economicoperations of FDI-related enterprises (GATS Mode 3)
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
GATS MODE 4: GATS MODE 4: MovementMovement of Natural of Natural PersonsPersons
SaleSale
Mode 4 Mode 4 statisticalstatistical capture capture willwill involveinvolvenew new modalitiesmodalities withwith surveysurvey atat national national levellevel
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
SHORT TERM SOLUTIONSDuring data improvement, many Developing Countries can make use of private sector databasessuch as the one used by UNCTAD, to learn more about FDI flows based on mergers and acquisitions, for GATS Mode 3 insight on FDI flows and operations data on FDI-relatedenterprises.
Example: Egyptian Merger and Acquisition Data, used as a Proximitive for foreign direct investment flows
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
Questions for National Governments
1. Will Enterprise Survey Reporting Mandatory or Voluntary?1. Will Enterprise Survey Reporting Mandatory or Voluntary?� Should enterprise survey reporting be statuatory (legally required)?� If yes, should penalties be involved for non-compliance be involved?
2. Benchmark2. Benchmark--level of reporting: Who reports?level of reporting: Who reports?� For example, the U.S. requires that firms conducting over 1 million dollars of cross-border
services trade to report3. Confidentiality of Survey Data: Will survey 3. Confidentiality of Survey Data: Will survey respondantsrespondants receive immunity?receive immunity?
� Enterprise Survey respondants are more truthful if they are guaranteed protection from legal or tax use of the collected data
� This requires independence of the statistical bureau and trust-ability of the government
4. Which sectors will have 4. Which sectors will have havehave inin--depth surveys?depth surveys? verses, which are part of overall services sector surveys
5. Resource Allocation issues5. Resource Allocation issues �� How this work will be funded in a stable and predictable manner?
These questions would be addressed by interThese questions would be addressed by inter--Ministerial Task Force at national level Ministerial Task Force at national level
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
ISTIA provides a �Basket of Alternatives�such that developing countries can better understand their options
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IISTIA� INTERNATIONAL SERVICES TRADE INFORMATION AGENCY http://www.servicestrade.org
ISTIA utilizes EXISTING COMPETENCE in related areas
synthesizing related capacities and existing competencies into a focused programme for services trade statistics, which can be replicated in future country projects