ESF covers most services sectors, including: Insurance Banking Business services: IT & Computer; consulting, advertising, after-sales services Professional services: legal services, accountants, architects, engineers Construction services Distribution services Publishing services (incl. Music) Postal & Express Delivery services Audio-visual services Energy related services Environmental services Telecommunication services Tourism Air Transport Maritime Transport But no members in Education or Health services For more information, see www.esf.be
ESF MEMBERS INCLUDE: BARCLAYS BANK PRICEWATERHOUSE- CLIFFORD CHANCE COOPERS COMMERZBANK ROYAL AHOLD NV DEUTSCHE BANK SIEMENS AG DHL TELEFONICA FRANCE TELECOM TNT IBM EUROPE TUI LLOYD S VEOLIA ENVIRONMENT METRO AG VODAFONE For more information, see www.esf.be
Percentage of GDP by Sector, 2003 70 65 68 60 50 51,2 50 40 30 20 20 14,8 32 30 30 34 Developed Developing EU China 10 0 3 2 Agriculture Industry Services
Services Share of World Trade Services 26% Services share of total employment in the EU Agriculture 4,2 Agriculture & Industry 74% Share of Agriculture = 8% Share of Services = 26% Services Industry 28,6 67,2 EU External Current Account 2 nd Quater 2005 Global deficit: -22,4 Bio Services Share of FDI Agric. & Industry 40% Services 60% Services Trade in Services: +16,5 Bio The Services sector generates 90% of new jobs in the EU15 (+ 8 millions Jobs created in services between 1999-2003)
EU-15 International Trade in Services with non-eu Countries 2002, EUR bn Rank Country Trade Volume Exports Imports Balance 1 USA 229.937 119.355 110.582 8.773 2 Switzerland 71.201 38.119 33.082 5.038 3 Japan 26.465 17.471 8.994 8.476 4 Norway 20.040 11.907 8.133 3.774 5 Canada 14.916 7.809 7.107 701 6 Turkey 10.517 3.005 7.512-4.507 7 Hong Kong 10.230 4.830 5.400-570 8 Australia 10.206 5.609 4.597 1012 9 China 9.858 5.262 4.496 666 10 Russia 9.524 4.747 4.777-29
EU-15 International Trade in Services with non-eu Countries in 2002 (EUR bn) Rank Country Trade Volume Exports Imports Balance 11 Singapore 9.074 4.553 4.521 32 12 South Africa 6.535 3.598 2.937 661 13 Brazil 6.459 3.350 3.109 242 14 Korea 6.236 4.073 2.163 1.910 15 Mexico 5.841 3.486 2.355 1.131 16 India 5.151 2.737 2.414 322 17 Egypt 4.747 1.709 3.038-1.329 18 Israel 4.548 2.534 2.014 519 19 Thailand 4.088 1.360 2.728-1.367 20 Taiwan 3.725 2.000 1.725 274 21 Croatia 3.592 1.368 2.224-856 22 Morocco 3.532 1.298 2.234-936 23 Malaysia 3.091 1.657 1.434 222 24 Romania 2.289 945 1.344-400 25 Indonesia 2.196 1.162 1.034 128
State of play of the GATS Negotiations + 400 Initial requests EU= 109 70 Initial offers as of November 2005 28 Improved offers as of November 2005 Next steps: a) Hong Kong Ministerial b) Draft final offers Final negotiations of the DDA: Mid 2006? End 2007? US TPA deadline?
WTO is not the World Agriculture Organisation A balanced agreement in Hong Kong is crucial, with due consideration for goods and services interests, the most important one for the EU; The text on Services must be improved; WTO Members must take real political commitments (not only Best Endeavour ) in the services area; Current text is unacceptable: We are determined to intensify the negotiations + Members should strive to ensure that.
How can services liberalisation be beneficial to World Trade? By attracting FDI in infrastructure services: Telecommunications Logistics (transport, distribution, etc.) Energy network Water and waste network Financial services system,etc. Foreign service suppliers make long-term investments in their host countries By knowledge transfer and expertise from foreign services suppliers, which leads to: Higher quality Competitive pricing Wider choice for consumers
The main barriers to services liberalisation are: Limitations on capital ownership Limitations on licences allotted to foreign companies Restrictions on real estate access Local employment requirements Lack of National Treatment in many services sectors Long and burdensome administrative procedures Lack of transparency in domestic regulation on: Licensing requirements Qualification requirements, etc. «The voice of the European Service
IMPROVING CROSS BORDER TRADE AND MOBILITY OF SKILLED PERSONNEL The current round of GATS Negotiations ought not only improve market access via Commercial Presence Abroad--Mode 3 of the GATS i.e. joint ventures; subsidiaries; branching, but WTO Members ought to also expect and demand: 1)Commitments for Cross-Border Supply via Mode 1 of the GATS, i.e. selling services without a commercial presence in the consumer s country i.e. e-commerce, internet, sending electronic data to call center, fax, back offices, etc. 2)Movement of Natural Persons via Mode 4 of the GATS, i.e. quickly moving skilled business personnel within a company (intracorporate transferees) and to a company s clients on a temporary basis
Preliminary Assessment of non EU Initial/Revised Offers: Assessment Countries Issues positive (+) or negative (-) Acceptable Average Disappointing Japan, Korea, Norway, Switzerland, Liechtenstein New Zealand, Hong-Kong, Panama, India US, Australia, Canada,Brazil Mode 4 (+), Business services (+), Tourism (+), Telecoms (+), Legal services (+), Courier services (+) Mode 4 (+), Business services (+), engineering (+), Postal (+), CPC (+) Financial services (-), Mode 4 (-), Telecoms (-), Transports (-), Financial services (-), IT(+), Legal services (+)
Pascal KERNEIS Managing Director European Services Forum ESF 168, Avenue de Cortenbergh B 1000 BRUSSELS Tel: + 32 2 230 75 14 Fax: + 32 2 320 61 68 Email: esf@esf.be. «The voice of the European Service Website: www.esf.be