Services Globalization in an Age of Insecurity: Rethinking Trade Cooperation

33 Pages Posted: 17 Sep 2018

See all articles by Aaditya Mattoo

Aaditya Mattoo

World Bank - Development Research Group (DECRG)

Date Written: September 11, 2018


Decades of services trade negotiations have produced a plethora of rules and commitments but limited real liberalization. One reason is a form of "negotiating tunnel vision," which has led to a focus on reciprocal market opening rather than on creating the regulatory preconditions for liberalization. This paper makes four points. First, current trade disciplines are a useful but inadequate restraint on regulatory protection. Second, proposed disciplines on domestic regulation would add value but would not solve problems with the application of existing trade law and could create a hold-back problem in securing new liberalizing commitments. Third, insulating domestic consumers from international market failure is a precondition for further liberalization in many services sectors, and the relevant international bargain needs to be an exchange of regulatory commitments by exporters in return for market access commitments by importers. Fourth, such bargains create a risk of exclusion for nonparticipants that can and should be addressed. The paper illustrates these arguments drawing upon recent developments relating to data privacy, financial services, labor mobility, and competition policy.

Keywords: International Trade and Trade Rules, Human Rights, Information Security & Privacy, Legal Institutions of the Market Economy, Labor Markets

Suggested Citation

Mattoo, Aaditya, Services Globalization in an Age of Insecurity: Rethinking Trade Cooperation (September 11, 2018). World Bank Policy Research Working Paper No. 8579. Available at SSRN:

Aaditya Mattoo (Contact Author)

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

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