Services Trade Liberalization and Regulatory Reform: Re-Invigorating International Cooperation

28 Pages Posted: 18 Jan 2011

See all articles by Bernard Hoekman

Bernard Hoekman

Robert Schuman Centre for Advanced Studies; European University Institute - Robert Schuman Centre for Advanced Studies (RSCAS); Centre for Economic Policy Research (CEPR)

Aaditya Mattoo

World Bank - Development Research Group (DECRG)

Multiple version iconThere are 2 versions of this paper

Date Written: January 2011

Abstract

Trade and investment in services is inhibited by a range of policy restrictions, but the best offers so far in the Doha negotiations are on average twice as restrictive as actual policy. They will generate no additional market opening. Regulatory concerns help explain the limited progress. We develop two proposals to enhance the prospects for both liberalization of services trade and regulatory reform. The first is for governments to create mechanisms ('services knowledge platforms') to bring together regulators, trade officials and stakeholders to discuss services regulatory reform. Such mechanisms could identify reform priorities and opportunities for utilization of 'aid for trade' resources, thereby putting in place the preconditions for future market opening. The second proposal is for a new approach to negotiations in the WTO, with a critical mass of countries that account for the bulk of services production agreeing to lock-in applied levels of protection and pre-committing to reform of policies affecting FDI and international movement for individual service providers - two areas where current policy is most restrictive and potential benefits from liberalization are greatest. If these proposals cannot be fully implemented in the Doha time frame, then any Doha agreement could at least lay the basis for a forward-looking program of international cooperation along the proposed lines.

Keywords: aid for trade, development assistance, GATS, international negotiations, knowledge platforms, services regulation, trade agreements, trade liberalization, WTO

JEL Classification: F1, F2, F5, L80

Suggested Citation

Hoekman, Bernard and Mattoo, Aaditya, Services Trade Liberalization and Regulatory Reform: Re-Invigorating International Cooperation (January 2011). CEPR Discussion Paper No. DP8181. Available at SSRN: https://ssrn.com/abstract=1742726

Bernard Hoekman (Contact Author)

Robert Schuman Centre for Advanced Studies ( email )

Fiesole, Tuscany
Italy

European University Institute - Robert Schuman Centre for Advanced Studies (RSCAS) ( email )

Villa La Fonte, via delle Fontanelle 18
50016 San Domenico di Fiesole
Florence, Florence 50014
Italy

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Aaditya Mattoo

World Bank - Development Research Group (DECRG) ( email )

1818 H Street, N.W.
Room MC 3-327
Washington, DC 20433
United States
202-458-8047 (Phone)
202-676-9810 (Fax)

HOME PAGE: http://econ.worldbank.org/staff/amattoo

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