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Developing countries and the Uruguay Round : negotiations on services

  • Hoekman, Bernard
  • DEC

In the late 1980s many developing countries experienced something of a pardigm shift: governments began to pursue more market-oriented domestic policies. There was an increasing perception that liberalizing access to service markets was a potentially low-cost, effective method for improving the quality and efficiency of domestic service sectors. These unilateral policy developments increased the incentives for developing countries as a group to participate in a multilateral agreement to liberalize trade in services. The author explores the extent to which the initial negotiating positions of developing countries are reflected in the draft General Agreement on Trade in Services (GATS) that has emerged from the Uruguay Round negotiations. He investigates whether the unilateral policy changes implemented by many developing countries in the late 1980s had a discernible impact on the draft GATS for developing countries. Many developing countries are pursuing regulatory reform and liberalization. To what extent will signing the GATS help governments trying to make their service sectors more efficient? Is the result of the defensive negotiating strategy that was pursued consistent with the shift toward a policy of liberalizing service markets? This issue is of particular relevance insofar as recent liberalization-plus-privatization programs in developing countries were driven by external forces rather than domestic pressure (industry) groups - which might reduce the credibility of liberalization policies. Membership in a binding multilateral agreement could help bolster reform efforts by increasing the costs of backsliding.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 1220.

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Date of creation: 30 Nov 1993
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Handle: RePEc:wbk:wbrwps:1220
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  1. Drake, William J. & Nicolaïdis, Kalypso, 1992. "Ideas, interests, and institutionalization: “trade in services” and the Uruguay Round," International Organization, Cambridge University Press, vol. 46(01), pages 37-100, December.
  2. Sapir, Andre, 1986. "Trade in investment-related technological services," World Development, Elsevier, vol. 14(5), pages 605-622, May.
  3. Bernard Hoekman, 1992. "Market Access Through Multilateral Agreement: From Goods to Services," The World Economy, Wiley Blackwell, vol. 15(6), pages 707-728, November.
  4. Bernard M. Hoekman, 1993. "Safeguard Provisions and International Trade Agreements Involving Services," The World Economy, Wiley Blackwell, vol. 16(1), pages 29-49, 01.
  5. Bhagwati, Jagdish N, 1987. "Trade in Services and the Multilateral Trade Negotiations," World Bank Economic Review, World Bank Group, vol. 1(4), pages 549-69, September.
  6. Cho, Yoon Je, 1988. "Some Policy Lessons from the Opening of the Korean Insurance Market," World Bank Economic Review, World Bank Group, vol. 2(2), pages 239-54, May.
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