Ingenieur Vol 61 January-March 2015 | Page 22

INGENIEUR of such trade under conditions of transparency and progressive liberalisation and as a means of promoting the economic growth of all trading partners and the development of developing countries. GATS recognize the right of Members to regulate, and to introduce new regulations, on the supply of services within their territories in order to meet national policy objectives and, given asymmetries existing with respect to the degree of development of services regulations in different countries, the particular need of developing countries to exercise this right. GATS Article V Clause 1 states that GATS agreement shall not prevent any of its Members from being a party to or entering into any agreement liberalising trade in services between or among the parties to such an agreement, provided that such an agreement: Has substantial sector coverage; ●● Provides for the absence or elimination ●● of substantially all discrimination, in the sense of Article XVII, between or among the parties, in the sectors covered under subparagraph (a), through, i. Elimination of existing discriminatory measures, and/or ii. Prohibition of new or more discriminatory measures, Either at the entry into force of that agreement or on the basis of a reasonable time - frame, except for measures permitted under Articles XI, XII, XIV, and XIV bis. Article XVII describes how Members handle National Treatment. Each Member shall accord to services and service suppliers of any other Member, in respect of all measures affecting the supply services, treatment no less favourable than that it accords to its own like services and service supplier. Formally identical or formally different treatment shall be considered to be less favourable if it modifies the conditions of competition in favour of services or service suppliers of the Member compared to like services or service suppliers of any other Member. 6 20 VOL 61 JANUARY – MARCH 2015 VOL 55 JUNE 2013 It should be noted that with the introduction of GATS, Governments still have the power and the right to regulate; the right to introduce new regulations even after commitments to GATS. Trade in Services Traditionally, ser vices were considered not “trade-able” and not storable. Services have also been traditionally strongly monopolised by Governments and Public Service. A majority of services managed by Governments or Public Service have been those that provide for noneconomic objectives and more focused on social, cultural or safety objectives. However, in the recent years Services have become more trade-able as a result of technical progress such as e-banking, telemedicine, and distance learning. Furthermore, Government is focusing on its core business and downsizing. Hence, with market liberalisation and regulatory reform, trade in services has been increasing. World expor ts of goods and commercial services have almost doubled since year 2000. Service exports data by economic groups for developed and developing countries for the year 1980-2004 shows that in 1980, 80% of the exports came from developed countries while 20% came from developing countries, including least developed countries (LDC) and Commonwealth Indep endent S t ates (CIS) countries. However in year 2004, the percentages have changed to 76% for developed countries and 24% for developing countries, which includes LDC and CIS. One obser vation from the above dat a [Source WTO database] is that it seems the develop ed countries combined benef ited so much more from trade in ser vices and li b e r alis a t i o n o f s e r v i c e s. F u r t h e r m o r e, if we t ake into a c c o unt t h at t h er e ar e more countries in the categor y developing countries, LDC and CIS countries, then the disparity between the benefit achieved by the developed countries and the non- developed countries will be huge.