workshop on trade policy and negotiating skills 4-8 october 2010 saint vincent & the...

bkp DEVELOPMENT RESEARCH & CONSULTING

Assistance to Saint Vincent and the Grenadines to

sensitise stakeholders about the WTO services

liberalization and its implications and

hence support more effective

participation in the process and its implementation

(9 ACP RPR 140 - Activity n° 003-09)

Workshop on Trade Policy and Negotiating Skills

4-8 October 2010 Saint Vincent & the Grenadines

Trade Policy Research:Aims and Means

Pierre Sauvé, WTIpierre.sauve@wti.org

5 October 2010

Aims of Trade Policy Research

• Better situating trade policy analysis in development/economic policy formulation

• Assessing in-house abilities within the trade ministry – training forms part of the aid for trade supply chain

• Marshaling expertise in relevant ministries and agencies, civil society organizations (incl. the private sector)

Why trade policy research?

• To identify where SVG‘s trade negotiating interests lie

• Time out: is engagement in international negotiations (always) necessary relative to autonomous domestic policy reform?

• Where is engagement optimal? In the neighborhood or at the global level?

• What drives the process? Export vs import-competing interests (defensive interests are more politically driven, and economic analysis, however good, tends to take a back seat to defensive trade politics 3

Much scope for free-riding

• There is condiderable expertise and information available on the websites of key international organizations, especially the WTO, but also in the neighborhood (i.e. SICE)– Subscribe to all that is relevant (and often free)

online• Free riding is always an option, especially on rules

issues, collective requests, general negotiating proposals, IO secretariat documents. This facilitates monitoring and analysis, but is no substitute for work focused on context-specific challenges

Pursuing SVG-specific interests

• Inputs into trade policy making: – knowledgeable policy officials (training

matters); – a mastery of the regulatory landscape (hence

the importance of conducting a prior regulatory audit);

– adequate consultative mechanisms, both at the inter-agency level and with external stakeholders (esp. the private sector)

Trade Policy Research Outputs

– industry-specific sectoral strategies, – competitiveness analysis, – ex ante impact assessments, – identification of regulatory implementation

bottleneck,– legislative change analysis

Asking the right questions

• Focusing on the right issues over the whole negotiating cycle in services trade– Before…During…After...negotiations

1. Mapping a strategy for services in national development plans;

2. Preparing for services negotiations;3. Conducting services negotiations;4. Implementing negotiated outcomes; and5. Enhancing the capacity to supply newly-

opened foreign markets.

Mapping a strategy for services in national development plans - Key questions

What is the institutional setting for dealing with services within the government?

Is there an authority, agency or ministry responsible for coordinating strategies focused on the service sector?

Is the coordinating authority, agency or ministry capable of making and executing decisions?

Are services being dealt with adequately from a sectoral perspective?

Are there sufficient and well-functioning ministries or agencies devoted to service sectors?

Does the service sector have a voice in the establishment of national development strategies?

Are national development strategies based on economy-wide considerations?

Mapping a strategy for services in national development plans - Key questions (2)

Are priorities clear in terms of support, regulation or policy-making for services and their relationship to the overall economy?

How far should government intervention go in the economic realm in general and in the service sector in particular?

What role should be assigned to trade and investment policy relative to autonomous liberalisation in pursuing a service sector development strategy?

Has a cost-and-benefit analysis been undertaken with respect to the opening up of the economy in general and the service economy in particular?

Has a cost-and-benefit analysis been undertaken with respect to the non-liberalisation of the economy and specific service sectors?

How clear are the government and key stakeholders on the opportunity costs of various liberalisation scenarios?

Key questions in preparing for services egotiations

Is the coordinating authority, lead agency or ministry fully in place and ready to operate?

Have capacity-building needs been identified with respect to the overall approach to liberalisation and trade agreements, i.e. the readiness to liberalise, the strategies to adopt in negotiating liberalisation and the advantages from negotiating, particularly in terms of access to foreign markets?

Does an inventory of measures affecting trade in services already exist at the horizontal and/or sectoral level? Beyond its use in trade negotiations, is the information gathered in such inventories being used to underpin domestic dialogue with key regulatory agencies and external stakeholders and as a means to promote regulatory review and reform processes?

Key questions in preparing for services negotiations (2)

Once an inventory of trade-related regulatory measures is put in place, what is the basis for determining what regulatory requirements are adequate and/or acceptable or in need of change?

In instances where regulatory change appears necessary, can or should changes be contemplated within the timeframe of ongoing international negotiations?

If so, could or should these changes be presented as part of the offer the country is to make in relevant concurrent international negotiations?

What criteria should govern the choice of measures and/or modes of supply in which sectors to offer as fully bound, partially bound or unbound commitments?

Key questions in preparing for services negotiations (3)

Has a clear distinction been made between defensive and offensive interests in negotiations?

How does the government determine its negotiating red lines (i.e. points beyond which it will not go)?

How significant is the voice of consumer/user groups in the formulation of service sector policy? Should technical assistance be directed at nurturing such voices or sustaining their development?

Has the coordinating entity managed to organise the necessary consulting process with all relevant stakeholders in the public and private sectors, including with trade unions and with relevant non-governmental organisations?

Is the consultation process with stakeholders broad enough to be truly representative?

Key questions for the conduct of services negotiations

Has the government identified specific rule-making issues to which it intends to attach priority importance in the conduct of services negotiations?

How adequate are the negotiating skills of the country’s trade and regulatory officials, particularly as regards the capacity to take an active part in – and influence - discussions on rule-making issues in services negotiations?

Has the government considered teaming up with other WTO Members or regional partners in formulating proposals and negotiating on selected rule-making issues?

Has the government considered how best to cooperate with various international organisations, bilateral donors or expert NGOs in formulating negotiating proposals on selected rule-making, market-opening or development issues?

Key questions for the conduct of services negotiations (2)

Has the government considered the pros and cons of participating in collective requests and offers on selected rule-making, thematic or sectoral issues with a view to overcoming resource constraints and achieve scale economies in the conduct of negotiations?

What use is the government thinking of assigning to Article XVIII (Additional Commitments) of GATS (and PTA equivalents) in sequencing liberalisation undertakings (pre-committing to future opening) and/or addressing sector-specific complements of market opening (for instance in respect of government procurement, emergency safeguards, labour mobility-related issues, etc.)?

Have export interests been identified so as to contribute to the elaboration of a realistic request list? How does the government compile information on foreign barriers affecting the country’s service suppliers?

Key questions for the conduct of services negotiations (3)

How does the ministry or agency responsible for the conduct of services negotiations seek input from key stakeholders in responding to requests for market-opening formulated by trading partners?

Do consultations focus primarily on targeted sectors and key domestic suppliers or is an attempt made to weigh the economy-wide implications of acceding to negotiating requests?

Does the government weigh the pros and cons of binding less than the status quo, notably in terms of the signals such a decision may send regarding the country’s investment and regulatory climate?

To what extent is the government’s negotiating stance in services, notably as regards the evolution of liberalisation offers, informed by - and coordinated with – the state of play of negotiations in non-service sectors?

Key questions in implementing negotiated outcomes

Are negotiating offers and proposed new and/or improved commitments informed by an assessment of the possible implementation costs (including recurring costs) relating to regulatory enforcement activities?

Has a proper assessment been made of the capacity-strengthening needs of key regulatory agencies prior to scheduling new and/or improved commitments?

Has the government given thought to formulating requests of needed capacity-strengthening as a pre-condition or quid pro quo for new and/or improved commitments?

What considerations weigh on the government’s decision to pursue liberalisation in a progressive manner and sequence such liberalisation with strengthened regulatory and implementation capacities?

Key questions in implementing negotiated outcomes (2)

Has an attempt been made to benchmark the country’s regulatory practices and institutions against those of key trading partners or of countries at similar levels of development and regulatory sophistication?

To what extent can regulatory harmonisation or the pursuit of mutual recognition initiatives help countries address weakness in domestic regulatory practices, help overcome the potentially trade-inhibiting effects of regulatory diversity and move domestic regulatory regimes in the direction of “best” regional or global practices?

Is the government confident in its analytical capacity to conduct the various impact assessments linked to service sector liberalisation or does it require dedicated technical assistance to this end?

Have attempts been made to learn from the post-liberalisation implementation experience of neighbouring countries or countries at similar levels of development through targeted training?

Key questions to enhance supply-side capacities

What forms of advisory services and training opportunities have been developed to assist in strengthening trade and investment promotion organisations and private companies in developing countries?

How can detailed information best be supplied on the regulatory regimes prevailing in the specific service sectors of developed and emerging country markets of interest to developing country exporters of services?

Have online databases and electronic meeting places been developed to facilitate interaction between service suppliers in developing countries and companies in developed markets that may be seeking to outsource work or find partners?

Key questions to enhance supply-side capacities (2)

What funding opportunities exist to help small service exporting firms from developing economies take part in trade missions to developed and emerging country markets as well as buying missions for services importers from developed countries?

What steps have been taken to promote B2B dialogue and enhance access to distribution channels in the services markets of developed and emerging economies?

What forms of assistance, including by private companies, is best able to help developing country firms enhance quality standards and more easily meet host country certification and licensing requirements?

What special mechanisms or funds could be created to provide funding at affordable interest rates to services SMEs?

How can financial institutions in developing countries be encouraged to overcome their aversion to lend to service sector firms with limited physical capital and significant intangible assets?

Means of Trade Policy Research

• Long live the world wide web!• Key sources of trade-relevant information• International Organizations, both regional and

global• Think tanks/policy research centers• Industry associations (ESF, USCSI)• Trading partners’ websites

IOsOECD Trade -

http://www.oecd.org/topic/0,3373,en_2649_37431_1_1_1_1_37431,00.html

OAS - http://www.oas.org/en/default.asp ; http://portal.oas.org/Default.aspx?tabid=293&language=en-UShttp://www.sice.oas.org/INTAL - http://www.iadb.org/intal/index.asp?idioma=ENGIADB – http://www.iadb.org/ http://www.iadb.org/en/topics/trade/trade,1264.htmlADBI - http://www.adbi.org/World Bank -

http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,noSURL:Y~contentMDK:21685233~pagePK:210058~piPK:210062~theSitePK:239071,00.html

IOsWorld Bank

http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,noSURL:Y~contentMDK:21685233~pagePK:210058~piPK:210062~theSitePK:239071,00.html

ITC - http://www.intracen.org/

UNCTAD http://www.unctad.org/Templates/Page.asp?intItemID=1529&lang=1http://www.unctad.org/en/docs/webdiaeia200911_en.pdfhttp://www.unctad.org/en/docs/webdiaeia20101_en.pdfhttp://www.unctad.org/Templates/Startpage.asp?intItemID=2983

AITIC – www.acici.org

www.wto.orgWTO as a Legislature: Proposals for

negotiations Papers and non-

papers Ministerial

declarations Chairmen’s marks Draft texts (with

brackets) Agreements (a.k.a.

understandings, codes, etc.)

Schedules of commitments on goods and services

Accessions (trade policy memoranda, working party reports, etc.)

WTO as a Court: Requests for

consultations Procedural

documents Panel reports Appellate body

reports Arbitrators’ reports

WTO as Clearinghouse: Notifications

WTO as a Secretariat:

Trade Policy Reviews

Committee reports (minutes, summaries, etc.)

Secretariat reports (informational)

Reports by the Economic Research and Statistics Division (analytical)

WTO as an Institution:

Administrative and budgetary matters

workshop on trade policy and negotiating skills 4-8 october 2010 saint vincent & the...

trade policy analysis

services negotiations4

services negotiations3

defensive trade politics

trade ministry training

wto services liberalization

interests defensive

competitiveness analysis

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