Regional arrangements for mode 4 in the services trade: lessons from the ASEAN experience

Abstract

The paper deals with regional policies towards temporary labour migration (or the movement of natural persons) with specific reference to the liberalization of trade in services. The paper deals with policies towards labour migration, and progress in related Mode 4 negotiations within the GATS framework, among the Association of Southeast Asian Nations, or ASEAN. It finds that unilateral, national policies rather than regional or multilateral commitments dominate in policies towards temporary foreign workers. Despite advances on administrative issues, little progress has been made towards achieving ‘GATS-Plus’ outcomes, partly because of the lack of a strong political commitment among member countries to liberalizing the entry of foreign workers and partly because of real or imagined shortcomings in the ‘architecture’ for Mode 4 negotiations. Weak political will has led to relatively shallow commitments with a focus on skilled workers over unskilled migrants. With regard to architectural issues, we draw attention to the weaknesses of the ‘positive list’ approach in services trade negotiations, specifically with regard to the case of labour migration. However, the interpretation of the relationship between different modes of supply has also tended to inhibit regional negotiations for Mode 4. In particular, we point to the neglect of the potential importance of independent suppliers of services. It is concluded that the ASEAN countries need to place more emphasis on regional priorities and problems in seeking more open worker flows within the region.