Services liberalization in the new generation of preferential trade agreements (PTAs): how much further than the GATS?

Abstract

AbstractThis paper attempts to fill a gap in the trade literature by providing a comprehensive overview of services liberalization commitments in the new generation of preferential trade agreements (PTAs) as compared to prevailing GATS commitments and Doha Round offers. The paper reviews the commitments undertaken by 36 WTO Members (counting the EC as one) under mode 1 (cross-border supply) and mode 3 (commercial presence) in 32 PTAs negotiated since 2000. Among other things, the results suggest that, overall, PTA commitments tend to go significantly beyond GATS offers. Countries that have signed PTAs with the United States have made spectacular improvements, but GATS+ commitments are not limited to such agreements. The paper also discusses the potential economic costs arising from these preferential agreements and implications for the role of GATS and for multilateral services negotiations. The paper concludes by exploring possible approaches to overcome the downsides of services PTAs, including suggestions for a more pro-active role for the WTO in the surveillance of these agreements.