Overview

This chapter discusses the four modes of supply of services that are covered by the GATS, the sources of services data, and the services growth experiences of selected countries and regions. It then notes how services reform can promote efficiency and growth at the sectoral level and economy-wide, pointing out that the benefits of services liberalization may be diminished by flaws in reform programs, the failure to provide for greater services access for the poor, and the need to take adjustment costs into account. The chapter argues that domestic policy reforms should recognize the...

This chapter discusses the four modes of supply of services that are covered by the GATS, the sources of services data, and the services growth experiences of selected countries and regions. It then notes how services reform can promote efficiency and growth at the sectoral level and economy-wide, pointing out that the benefits of services liberalization may be diminished by flaws in reform programs, the failure to provide for greater services access for the poor, and the need to take adjustment costs into account. The chapter argues that domestic policy reforms should recognize the importance of increasing competition among service providers; the need for appropriate sequencing of reforms; and reduction of the importance of national monopolies. Further, it stresses that international engagement is crucial to buttress domestic reform in order to achieve reciprocal liberalization, greater credibility of reform, provision of external assistance to facilitate domestic adjustment, reinforcement of the reform process, and promotion of greater harmonization and integration of policies. The ongoing GATS negotiations are an important and essential framework to support the international liberalization of services, and should include the design of arrangements for aid to developing countries to help promote services trade and promote greater cooperation on temporary migration. There may also be greater scope for achieving deeper integration of particular services sectors by means of regional services agreements.