Services play a crucial role in contemporary economies and Other News from the WTO Ministerial Meeting (MC12)
The World Trade Organisation (WTO) has concluded the 12th Ministerial Conference (MC12) in Geneva. This looked in some detail at trade in services. Malawi, on behalf of the LDC Group of 36 countries, highlighted that implementation of the services waiver as one of the priorities from the MC12. This waiver will give Least Developed Countries (LDCs) Specific benefits for the services they export. Ministers’ instructions to the Council included exploring improvements in LDC services export data, reviewing information about suppliers and consumers of LDC services in preference-granting members and learning which best practices can facilitate the use of preferences. Another issue discussed by the Ministers was the Ecommerce Work Programme and in particular the moratorium on customs duties for cross-border electronic transfers (see previous editions of this Newsletter)
LDCs’ share of the services sector was a major engine of economic growth and more than doubled from 1995 (38%) to 2019 (77%). Globally, services generated about 66% of economic output in 2019 and created most jobs. SMEs in a few key sectors are at the heart of this services-led economic transformation. Most services enterprises are small, with 9 out of 10 having fewer than 100 employees. Entry costs are generally lower than in other sectors. Compared with manufacturing, it is easier to be small and export in services. When small services firms are competitive and export, they contribute to development and economic transformation. Much depends on the global supply chain with digital technologies. A set of 4 services, which the International Trade Centre (ITC) calls ‘connected services’, are at the centre of these contemporary economic trends. They are transport and logistics, financial services, information and communication technologies, and business and professional services.
WTO members also secured multilaterally negotiated outcomes on a series of key trade initiatives. The “Geneva Package” confirms the historical importance of the multilateral trading system and underlines the important role of the WTO in addressing the world’s most pressing issues, especially at a time when global solutions are critical. In the final statement signed by most members, there was encouragement for the work done on ecommerce (at the so-called JSI committee), and committed themselves to continuing with the moratorium on customs duties on cross border electronic transmissions. A separate statement by India, Indonesia and SA also pressed for the ecommerce committee to continue its good work (strange as SA has resolutely refused to be party to that committee), but did not refer to the moratorium.
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