Saturday, June 25, 2005


URGENT: The ASA secretariat received an important update email from Alexandra from the Institute for Agriculture and Trade Policy (IATP) about some of the important development in the GATS negotiation. The EU Commission had called for a meeting on GATS with a number of key countries countries in Geneva on June 24.

The countries invited are Quad (US, EU, Japan and Canada), China, Hong Kong, India, Brazil, Malaysia and Rwanda. More importantly, the meeting will be held after the Quad meeting on the same issue: "an assessment of the offers, examination of the next steps in particular the "first approximation", by the end of July and possible benchmarks for offers."

Conspiracy Theory?

In fact the Quad has been discussion these issues for some time now. Apparently the time has come to work on the next concentric circle of a new consensus building exercise that the Quad has been preparing.

In Brussels, the EU Commission has so far decline to give indication on benchmarking. When asked a month ago, the Commission said "We began an internal reflection, which is very much in early stages; benchmarks will only be necessary if the offers are still of poor quality. Some might also wait until bechmarks are established before they want to table anything, to table only the minimum. Benchmarks are incredibly difficult."EU member states officials in the main time claimed that had not yet heard of any GATS benchmarks at all.

Last week, the EU member states representatives had presented some of its ideas on benchmarking. Although the Commission representative cautioned that "even the internal discussion in the Commission were still going on", the ideas presented are scary enough as the are.

How scary there are?

The Commission wants GATS benchmarks to have both quantitative and qualitative elements. The cross sectoral approach would mean that each member would agree to make commitments in a certain number of key sectors. This could mean, for example, that the developed countries would take commitments in 8 of 10 agreed key sectors, developing countries in 5 or 6 of them and the LDCs would do the best they can. In this approach one had to agree first the list of key sectors.

Note that in the WTO classification of services there are only 11 sectors including health, education, environment and culture (but about 50 sub-sectors).

The qualitative approach could be an obligation to bind at least the status quo in the selected sectors and go beyond it in some them. (for example, the developed countries should do so in 2 out of the 8 chosen sectors and the developing countries in 1 of the chosen 5-6 sectors). This is very worrying. As in NAMA where the EU wants the tariff reductions to "bite into the applied tariffs", it wants countries to not just bind what they have already liberalised, but also to make commitments for new liberalisations.

For the benchmarking that contain specific measures for the reduction of horizontal limitation, there should be an obligation to reduce the current requirements related to each mode of supply in a certain percentage of sectors.

However, setting a benchmark that would demand the reduction of "current requirements related to each mode of supply in a certain percentage of sectors" would make GATS a exercise in arithmetic instead of a serious negotiation about serious matters: where you have made 5 limitations you now put 3.

Alexander also appeal to all of us to start to make pressure in our countries on the issue of services, use the info for the press work and what ever work that we do with the GATS letter.