US joins collective bids process in WTO services negotiations
Regional-USA, Economics, 3/1/2006

The United States has joined other countries in an initiative aimed at jump-starting moribund World Trade Organization (WTO) services negotiations, the Office of the US Trade Representative (USTR) says.

The United States has decided to join 12 varied groups of like-minded countries, called "friends" groups at the WTO in Geneva, in making demands for better access to markets in 12 services sectors, ranging from telecommunications to education, according to a February 28 USTR press release.

"Services liberalization enhances the gains from liberalization in goods and agriculture by making the infrastructure of modern economies – express delivery services, reliable communications, financial services, transportation services and others – more widely available," Deputy US Trade Representative Peter Allgeier said in the release.

According to Bob Vastine, president of the US industry group Coalition of Service Industries (CSI), the 12 friends groups comprise different mixes of developed and developing countries. Those groups are making demands mostly of large, rapidly growing developing countries, he said.

Their requests seek elimination of such barriers to trade as limits on foreign investment, nationality requirements, discriminatory regulations, limits on new entrants, prohibitions on branching and bans on Internet services.

The requests are not new for the United States, Vastine said. What is new, he said, is the use of multiparty requests bringing countries together to pursue an ambitious level of agreement in the long-stalled WTO services negotiations.

"We haven't seen in Geneva ever before this kind of activity," Vastine said. "It's a big deal. It really works."

He said the big developing countries facing demands to open their services markets have been grumbling about the multiparty process, calling it confusing and counterproductive.

"But it's really disinformation by some of these large countries that don't, frankly, want to be faced with a lot of requests and don't want to feel like they've got to make offers," Vastine said.

Between now and a June 30 deadline, the groups making requests and the countries expected to make offers are supposed to engage in intense rounds of discussions.

The United States also will have to face demands from developing countries' friends groups, especially in the so-called Mode 4 of the services negotiations concerning increased temporary entry for workers from one country to supply services in another country -- a politically sensitive issue in the US Congress.

"We would not be surprised if we were the recipient of a Mode 4 request," Deputy US Trade Representative Susan Schwab told reporters in a teleconference. "If and when that arises we will have to figure out what to do about it."

The groups in which the United States is participating are making demands to open markets in telecommunications, financial services, computer services, distribution services, express delivery, energy services, environmental services, legal services, construction, architectural and engineering services, audiovisual services and education.

The broader WTO negotiations -- formally called the Doha Development Agenda and including agriculture, industrial goods and other issues besides services -- are scheduled to conclude by the end of 2006.

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