The Canadian government officially announced on March 16 in the
Canada Gazette that Canada would be participating in a
negotiation towards a Plurilateral International Services
Agreement. The Notice invites interested parties to submit
their views on negotiating issues by April 30.
This new negotiation is an important development. It
represents a continuing effort by the Government of Canada to
achieve better market access for Canada's important services
sector despite the failure of the Doha Round over the past 11 years
to achieve a broader multilateral agreement including services.
With all the attention being paid to Canada's
soon-to-conclude negotiation with the European Union, and
just-begun engagement in the Trans-Pacific Partnership talks, this
much smaller exercise is flying somewhat under the radar.
Although the Government has been consulting with the private
sector during the Doha Round regarding services issues, this
plurilateral approach represents a "fresh start" to such
negotiations in a different setting. Canadian service
companies would be wise, therefore, to update their previous
submissions or to make new ones in responding to the issues set out
in the Gazette Notice.
These new services talks will be held in Geneva, but take place
outside the multilateral WTO framework and at separate
premises. There is some sensitivity in this. A few
Member countries have said that holding separate plurilateral
negotiations will undermine the multilateral system. However,
the WTO can legally accommodate plurilateral agreements in certain
circumstances, and the 1994 General Agreement on Trade in
Services (GATS) provides specifically for such an approach in
the case of Services. It is thus intended that any new
plurilateral services agreement would be brought under the WTO
umbrella and made open to accession by non-participant Members.
As hopes for the Doha Round have waned, discussions have been
underway for the past year among some WTO Members on the notion of
putting together a plurilateral negotiation. Those involved
have shared Canada's view of the need to press ahead with
something in this increasingly vital component of international
commerce in the absence of a Doha result. At last count 22
countries have signed up to participate, and others are expected to
Participants include Canada's major traditional economic
partners --- the USA, EU, and Japan --- but more importantly for
the future a number of significant emerging markets --- Korea,
Mexico, Colombia, Turkey --- plus several other important Canadian
economic partners such as Chile, Hong Kong (China), Israel, Costa
Rice and Peru.
While it is disappointing that the largest emerging markets are
not involved so far, it is still possible that India (with its
aspirations to be a global services power), and even China could be
drawn in. Another good addition would be the ASEAN group of
Getting a plurilateral negotiating table underway will be an
important complement to the bilateral talks Canada has underway
with Japan, Korea and prospectively Thailand and others, where
Canada can drive for higher quality bilateral results against a
rising plurilateral standard being driven from Geneva.
The Geneva talks can also link up nicely with the services
discussions underway in the TPP, ensuring consistency between these
two broader group settings (building eventually to higher
multilateral standards in the WTO) and helping drive quality of
outcomes in a region where many services markets are still under
development and constrained by lack of openness to the outside.
Already, the decision among participants in Geneva to move from
a "positive list" to "negative list"
approach in the eventual plurilateral agreement is a good step
forward. This has been Canada's preferred approach.
It is more favourable to market liberalization since it assumes
from the start that all services sectors will be covered and
obliges a party to the agreement specifically to list any sector it
does not want included in its undertakings. The
"positive list" approach of parties listing those it is
prepared to include, inevitably leads to a narrower agreement and
leads to delays in the inclusion of emerging services sectors.
While no date has yet been set for a start in negotiations, they
should get underway later this year and could progress quickly
among this group of like-minded proponents. Canadian services
companies should be keeping a close eye on this negotiation and
encouraging government negotiators to seek a high quality
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