Trade in Services
Related Activities and Documents
"The World Trade Organization: Looking and Moving Forward"
Speaking Notes for an Address to the
Services 2000 Business-Government Dialogue
by
the Honourable Sergio Marchi
Chair of the WTO Council for Trade in Services
Washington, D.C.
November 15, 2000
Introduction
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It is a pleasure to join you tonight at the Services 2000 awards dinner, and to have the chance to address such a prestigious group of government and business leaders in the services industry.
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The great German writer Goethe once said: "when ideas fail, words come in very handy." Lucky for us all, during today's conference here in Washington, I have heard lots of bright ideas on how to move things forward at the WTO, so I will be able to be brief!
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As you know, the WTO, with 139 Members, is an awfully big family where decisions are taken by consensus. So we don't always make progress as quickly as we might wish.
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In fact, as I sit through some of the interminable meetings that go on in Geneva, I sometimes fear that the Canadian philosopher Marshall McLuhan was right when he said "there are no more great men; there are only great committees."
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But we soldier on, conscious of the fact that as we embark on an ambitious agenda of negotiations at the WTO, all countries will need to show continued patience and realism. Progress will require time, hard work and, most importantly, leadership from countries like the United States.
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I have been asked this evening to provide a brief picture of the prevailing mood in Geneva. In response, let me then touch on three themes.
First, we need to recognize that the WTO is now operating in a "Post-Seattle environment"...which in a way, is not business as usual
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We all remember the Seattle ministerial meeting, where despite the goodwill shown by all delegations, countries were unable to agree on the parameters for the launch of a new round of multilateral trade negotiations.
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Policy differences between countries were compounded by challenges in the public domain. And demonstrations about globalization were in vogue. In fact, the Seattle meeting, for much of the world's public, was a watershed event that transformed the WTO from anonymity to celebrity status, virtually overnight, and for many of the wrong reasons.
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There was then, and still is today, a need to correct many public misperceptions about the WTO itself.
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It is unfair for critics to lay all the challenges facing the world today on the WTO's doorstep. Equally, there is no conspiracy by the WTO to become the all-powerful global agency. It is not the World Organization. It is the World Trade Organization, and it has the specific mandate of promoting trade liberalization and prosperity.
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Particularly, during this post-Seaftle period, the private sector must play a leading role in helping governments generate support for trade liberalization, including in services. We need to direct more efforts to better inform the public about the WTO.
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We also need a coalition of both big and small business, CEOs and workers alike. And building on a legendary phrase by the late Tip O'Neill, we need to recognize that like politics, trade is local. The jobs and economic activities generated by our exports -- of both goods and services -- are at the very heart of all our industrial parks and communities right across North America.
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At the same time, these efforts would be enhanced if the WTO, as an institution, were to reform itself and become more open -- an issue that is currently being reviewed by the WTO General Council.
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After all, as James Wolfensohn, President of the World Bank, said recently in Prague: "Our challenge is to make globalization an instrument of opportunity and inclusion, not fear and insecurity."
Second, despite Seattle, the WTO continues to move forward
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The WTO did not die with the final gavel in Seattle. Indeed, there are some vital initiatives underway.
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Beyond the day to day transactions, for example, we have been tackling, throughout the autumn, a series of implementation concerns raised by developing countries that touch on a "re-balancing" of the full range of agreements negotiated during the Uruguay Round.
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These discussions are not easy, since re-opening agreements outside the context of a new Round will be very difficult.
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We are also working on over 30 accession requests (including China, Russia, Chinese Taipei, the Ukraine and Saudi Arabia); as well as striving to improve the internal and external transparency of the WTO itself.
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Most significantly, besides launching the services talks, negotiations on agriculture have begun. And people should make no mistake: these negotiations are real and they are important. Combined, they total nearly 1/3 of everything that is traded around the world.
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At US$1.3 trillion in world trade in 1998, commercial services are growing quicker than any other area of international trade. In fact, more than 60% of world production is derived from services.
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As you well know, services industries are also the number one employer in many countries. Here in the U.S., 71 % of your GDP is generated by services, making you the world's largest exporter and importer of commercial services.
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Overall, the services and agriculture negotiations represent a unique opportunity to achieve greater liberalization and stimulate economic growth worldwide. Services, in particular, have come to epitomize the future of our high tech global economy. This is why the negotiations represent a win-win situation for both developed and developing countries.
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As Chair of the Council on Trade in Services, and recognizing that the GATS follows a "bottom-up" approach where Members liberalise only in the sectors they agree to, I am pleased that the services negotiations have to date been guided by a constructive and positive spirit on the part of all Members.
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Proposals for negotiating guidelines have been received from several developed and developing country Members, including the United States.
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Our aim is to reach agreement at a stock-taking meeting in March, where Members will also assess progress made thus far and determine next steps.
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Moreover, both the European Union and the United States plan to submit sector papers, in December or January, identifying their general objectives for the access negotiations. In a sense, this could be viewed as a "soft launch' of the access negotiations.
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Not only is this a helpful and valuable initiative, but it is also the kind of leadership that will maintain the momentum of our work, encourage other countries to come forward with their priorities, and hopefully energize the participation of the private sector in a practical way.
Finally, what are the prospects for the launch of a new Round?
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It is probably the most often asked question of any WTO Ambassador. And no one has the definitive answer.
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While much difficult work lies ahead, some believe that expanded negotiations could be launched at the next ministerial conference, expected to be held in late 2001. Others feel this is overly optimistic.
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The rationale for a new Round makes sense. It is vital that the WTO remain up-to-date -- addressing new issues, tackling new problems and improving the agreements we already have. Our global economy is certainly not standing still. And nor can the WTO.
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Clearly, making progress on services and agriculture will be key if we are to contemplate expanding the agenda. After all, how will some Members react to taking on a broader agenda if they can't point to success in the two mandated negotiations?
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We can be somewhat optimistic because both sets of discussions have started positively. Members have been constructive and progress is being made. And hopefully, this will continue.
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Moving forward on the implementation discussions, will also be part of any launching pad scenario.
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Finally, we will need to shift from a post-Seattle period of confidence building to a phase of coalition building. Rather than setting arbitrary time-lines, we must narrow differences on key policy issues and bridge the gaps between countries. This will in turn build both confidence and momentum - ingredients that are indispensable if we are to successfully reach a consensus on broadening negotiations.
Closing remarks
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In closing, we have a lot of important work ahead of us in Geneva. And as we--governments, the private sector and our publics - tackle this agenda, we should be mindful of the old saying that tells us 'when you have a mountain to climb, standing still and looking at it won't make it any smaller."
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It will therefore be all the more important for the services negotiations to move forward. To reap the benefits of further liberalisation for all nations, rich and poor. To demonstrate the relevance and benefit of the WTO to our global economy. And ultimately, to serve as a catalyst for the launching of a new Round.
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I remain confident that we can and will succeed, and I look forward to working with all of you as Chair of the Services Council to realise this important and exciting objective.
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