Analytical Note, November 2011

Analysis Of Draft Waiver Decision On Services And Services Suppliers Of LDCs.

This Note is an analysis of the draft waiver decision submitted by the Chairman of the CTS to Ministers for adoption at the 8th Ministerial Conference. This is essentially a waiver from the most-favoured nation treatment clause (Article II. 1) in GATS to allow Members to provide preferential and more favourable treatment to services and services suppliers of LDCs.

Two main issues have arisen in the draft waiver text. Firstly the types of preferences covered by the waiver, in order to be effective, needs to go beyond market access measures. The second issue is that of rules of origin. There is need to clarify the meaning of rules of origin in the waiver.

It concludes that in order for the services waiver to be beneficial for the LDCs, it has to deliver on market access in sectors and modes of supply (in particular, mode 4) of interest to LDCs; improve access of LDCs services suppliers to global distribution channels and information networks. LDCs want operationalization of priority market access. Yet in as much as the waiver remains the unilateral decision of WTO Members to grant this preferential treatment; then there remains a weak link.

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