« The voice of the European Service Industries for the ...Services 26% Agriculture & Industry 74% « The voice of the European Service Industries for the GATS negotiations » Services

« The voice of the European Service

Industries for the GATS negotiations »

ESF covers most services sectors, including:

• Insurance

• Banking

• Business services: IT & Computer; consulting, advertising, after-sales services

• Professional services: legal services, accountants, architects, engineers

• Construction services

• Distribution services

• Publishing services (incl. Music)

• Postal & Express Delivery

services

• Audio-visual services

• Energy related services

• Environmental services

• Telecommunication services

• Tourism

• Air Transport

• Maritime Transport

But no members in Education

or Health services

For more information, see www.esf.be



• BARCLAYS BANK

• CLIFFORD CHANCE

• COMMERZBANK

• DEUTSCHE BANK

• DHL

• FRANCE TELECOM

• IBM EUROPE

• LLOYD’S

• METRO AG

• PRICEWATERHOUSE-

COOPERS

• ROYAL AHOLD NV

• SIEMENS AG

• TELEFONICA

• TNT

• TUI

• VEOLIA ENVIRONMENT

• VODAFONE

ESF MEMBERS INCLUDE:

For more information, see www.esf.be



3

20

2

14,8

3230 30

51,2

65

50

68

34

0

10

20

30

40

50

60

70

Agriculture Industry Services

Developed

Developing

EU

China

Percentage of GDP by Sector, 2003

Services Share of World Trade

Services

26%

Agriculture &

Industry

74%



Services share of total

employment in the EU

4,2

28,6

67,2

The Services sector generates 90% of new jobs in the EU15

(+ 8 millions Jobs created in services between 1999-2003)

Services

Agriculture

Industry

Services Share of FDI

Services

60%

Agric. &

Industry

40%

Share of Agriculture = 8%

Share of Services = 26%

EU External Current Account – 2nd

Quater 2005

Global deficit: -22,4 Bio €

Services Trade in Services: +16,5 Bio €

Rank Country Trade

Volume

Exports Imports Balance

1 USA 229.937 119.355 110.582 8.773

2 Switzerland 71.201 38.119 33.082 5.038

3 Japan 26.465 17.471 8.994 8.476

4 Norway 20.040 11.907 8.133 3.774

5 Canada 14.916 7.809 7.107 701

6 Turkey 10.517 3.005 7.512 -4.507

7 Hong Kong 10.230 4.830 5.400 -570

8 Australia 10.206 5.609 4.597 1012

9 China 9.858 5.262 4.496 666

10 Russia 9.524 4.747 4.777 -29

EU-15 International Trade in Services with non-EU Countries 2002, EUR bn

EU-15 International Trade in Services with non-EU Countries in 2002 (EUR bn)

Rank Country Trade

Volume

Exports Imports Balance

11 Singapore 9.074 4.553 4.521 32

12 South Africa 6.535 3.598 2.937 661

13 Brazil 6.459 3.350 3.109 242

14 Korea 6.236 4.073 2.163 1.910

15 Mexico 5.841 3.486 2.355 1.131

16 India 5.151 2.737 2.414 322

17 Egypt 4.747 1.709 3.038 -1.329

18 Israel 4.548 2.534 2.014 519

19 Thailand 4.088 1.360 2.728 -1.367

20 Taiwan 3.725 2.000 1.725 274

21 Croatia 3.592 1.368 2.224 -856

22 Morocco 3.532 1.298 2.234 -936

23 Malaysia 3.091 1.657 1.434 222

24 Romania 2.289 945 1.344 -400

25 Indonesia 2.196 1.162 1.034 128





State of play of the GATS Negotiations

• + 400 Initial requests EU= 109

• 70 Initial offers as of November 2005

• 28 Improved offers as of November 2005

• Next steps: a) Hong Kong Ministerial

b) Draft final offers

• Final negotiations of the DDA:

– Mid 2006? End 2007? US TPA deadline?



• WTO is not the World Agriculture Organisation

• A balanced agreement in Hong Kong is crucial, with

due consideration for goods and services interests, the

most important one for the EU;

• The text on Services must be improved;

• WTO Members must take real political commitments

(not only ―Best Endeavour‖) in the services area;

• Current text is unacceptable: ―We are determined to

intensify the negotiations‖ + ―Members should strive to

ensure that…‖.



By attracting FDI in infrastructure services:

• Telecommunications

• Logistics (transport, distribution, etc.)

• Energy network

• Water and waste network

• Financial services system,etc.

Foreign service suppliers make long-term investments in their host countries

By knowledge transfer and

expertise from foreign

services suppliers, which

leads to:

• Higher quality

• Competitive

pricing

• Wider choice for

consumers

How can services liberalisation be beneficial to World Trade?

The main barriers to services liberalisation are:

• Limitations on capital ownership

• Limitations on licences allotted to foreign companies

• Restrictions on real estate access

• Local employment requirements

• Lack of National Treatment in many services sectors

• Long and burdensome administrative procedures

• Lack of transparency in domestic regulation on:

– Licensing requirements

– Qualification requirements, etc.





The current round of GATS Negotiations ought not only improve

market access via Commercial Presence Abroad--Mode 3 of the

GATS – i.e. joint ventures; subsidiaries; branching, but WTO Members

ought to also expect and demand:

1)Commitments for Cross-Border Supply via Mode 1 of the GATS,

i.e. selling services without a commercial presence in the consumer’s

country—i.e. e-commerce, internet, sending electronic data to call center,

fax, back offices, etc.

2)Movement of Natural Persons via Mode 4 of the GATS, i.e.

quickly moving skilled business personnel within a company (intra-

corporate transferees) and to a company’s clients on a temporary

basis

IMPROVING CROSS BORDER TRADE AND MOBILITY

OF SKILLED PERSONNEL



Preliminary Assessment of non EU Initial/Revised Offers:

Assessment Countries Issues positive (+) or negative (-)

Acceptable Japan, Korea,

Norway,

Switzerland,

Liechtenstein

Mode 4 (+), Business services (+),

Tourism (+), Telecoms (+),

Legal services (+), Courier services

(+)

Average New Zealand,

Hong-Kong,

Panama, India

Mode 4 (+), Business services (+),

engineering (+), Postal (+), CPC (+)

Financial services (-),

Disappointing US, Australia,

Canada,Brazil

Mode 4 (-), Telecoms (-), Transports

(-), Financial services (-), IT(+),

Legal services (+)

Pascal KERNEIS

Managing Director

European Services Forum – ESF

168, Avenue de Cortenbergh

B – 1000 – BRUSSELS

Tel: + 32 2 230 75 14

Fax: + 32 2 320 61 68

Email: [email protected].



Website: www.esf.be

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