LexisNexis(TM) Academic - Document
Copyright 2005 The Financial Times Limited
Financial Times (London, England)

March 1, 2005 Tuesday
London Edition 2

SECTION: WORLD NEWS; Pg. 11

LENGTH: 478 words

HEADLINE: WTO talks on services markets face 'crisis'

BYLINE: By ALAN BEATTIE and FRANCES WILLIAMS

DATELINE: GENEVA and LONDON

BODY:


Trade ministers meeting in Kenya later this week need to take action to rescue World Trade Organisation talks on services from crisis, the top WTO official handling the negotiations has warned.

Speaking after three unproductive weeks of talks on opening services markets to foreign competition, Hamid Mamdouh, director of WTO's trade in services division, said services were "the crisis item" on the agenda of the three-day "mini-ministerial" meeting, which starts tomorrow.

Ministers and senior officials from nearly 30 rich and poor countries, including the US, European Union, India, Brazil, China and Japan, are due to attend the Mombasa meeting.

Mr Mamdouh said that, without a good outcome on liberalisation of services, it would be difficult to reach agreement on agriculture and industrial goods, the other key issues being negotiated in the Doha global trade round launched in 2001.

Industry lobbies, particularly the financial services sector, have stepped up their campaign for progress in the talks.

The Financial Leaders' Group, an association of financial services executives, concluded a recent trip to the WTO by agreeing to lobby member governments to improve their "offers" - proposals to open domestic markets to foreign competition.

"Ministers and policymakers in the capitals, the ultimate decision-makers in these negotiations, are not feeling the pressure to deliver on services," said Hugh Savill of the Association of British Insurers.

The US Coalition of Service Industries is planning a round of trips to important capitals in April and May to press for better offers.

Nearly two years after the deadline for countries to make initial services offers, only 47 have been submitted (the EU counting as one). The quality of their offers was "very poor", according to Alejandro Jara, Chile's WTO ambassador, who chairs the services talks.

Some 45 countries had yet to submit an initial offer - the very poorest are exempt - ahead of a May deadline for revised improved offers, Mr Jara said.

Mr Mamdouh noted that many offers did not even match the levels of liberalisation countries had already instituted, and few held out the prospect of additional business opportunities.

"What is on the table has not lived up to expectations," he said.

Though the opening of services markets is often seen as a rich-country priority, a number of developing nations, notably India, are now pressing for liberalisation in areas of concern to them, such as the temporary movement of workers to provide services abroad.

An analysis of current offers presented to WTO members by Mr Jara shows some improvements on existing commitments in business and financial services, though they do not necessarily represent improvements on what countries are already doing.

In other areas, such as construction, distribution and maritime services, countries have offered little or nothing.

LOAD-DATE: March 1, 2005