Education International
Education International

Negotiations begin on new services deal

published 5 July 2013 updated 11 July 2013

Trade talks aimed at developing a new global services pact have begun following an agreement on a negotiating framework earlier this year.

The Trade in International Services Agreement (TISA) is being negotiated by the so-called “Real Good Friends of Services” within the World Trade Organisation:  Australia, Canada, Chile, Colombia, Costa Rica, European Union, Hong Kong, Iceland, Israel, Japan, Mexico, New Zealand, Norway, Pakistan, Panama, Peru, South Korea, Switzerland, Taiwan, Turkey, and the United States.

Informal talks within the group began last year in response to pressure from business groups frustrated with the impasse in WTO negotiations to develop new and enhanced commitments under the General Agreement on Trade in Services (GATS).

In March, negotiators agreed to adopt a “hybrid” framework for the talks which would involve countries making market access commitments on a “positive list” basis, and national treatment on a “negative list” basis. With a positive list approach, countries agree to liberalise only those service sectors that they agree to, while with a negative list agreeing to liberalise all areas except those explicitly excluded.

The WTO members engaged in the talks have indicated that no service sector will be excluded, but some are pushing for priorities.  A joint Australia-EU paper issued late last year suggested 10 issues should be the focus of the TISA: cross-border movement of professionals; domestic regulation and transparency; financial services; professional services; information and communications services; transport and logistics services; maritime services; environmental services; energy services; and government procurement.

“While education services are not a specific focus of the talks to date, we nevertheless need to watch developments closely,” says Education International’s trade consultant David Robinson. “For instance, the inclusion of domestic regulation could affect rules around the accreditation of schools, and around qualification requirements that could have an impact on the design and delivery of vocational education and training.”

Robinson added that the targeting of financial services for further liberalisation is particularly worrisome given how weak regulatory oversight played a key role in the economic crisis of 2008.

“If there’s anything we’ve learned over the past few years it’s that the liberalisation of financial services has been a catastrophic disaster for the economy, for government finances, for working people, and for public services including education,” Robinson said. “Trade deals threaten to constrain policy space precisely at a time when governments need to rein in the financial sector.”

Robinson noted reports that the financial industry is lobbying to use trade deals as a way of weakening domestic regulations.

According to U.S. Democratic Senator Elizabeth Warren, there are “growing murmurs” about the financial industry’s efforts to “do quietly through trade agreements what they can’t get done in public view with the lights on and people watching.”

In letter published in May, Peter Allgeier, a former U.S. Trade Representative and now president of the Coalition of Services Industries , said that trade rules require that regulations are “least trade and investment distorting” and do not constitute a “disguised barrier to trade.”

Meanwhile, WTO members not participating in the TISA talks have criticized the initiative as undermining the multilateral approach of the WTO. Brazil, China, and India have been vocal opponents of TISA.