Nov 6, 1987

LABOUR NOT "SERVICE" FOR "TRADE IN SERVICES", SAYS U.S.

GENEVA NOVEMBER 4 (IFDA/CHAKRAVARTHI RAGHAVAN) The United States made clear Wednesday that "labour per se" should not be included in the services agreement it is advocating, but professional services like lawyers, architects and engineers should.

The U.S. services negotiator in the Uruguay Round, Richard Self, was briefing newsmen on the proposals tabled by the U.S. before the Group of Negotiations on Services (GNS) Tuesday outlining the elements to be included in a general framework agreement on services.

Asked how the U.S. distinguished between service of a barber or a carpenter and that of a lawyer or accountant, both of whom provided their skilled services, Self said the inclusion of the former would be a challenge to existing immigration laws, and there was no country that did not restrict movement of personnel.

But the U.S. negotiator did not explain how this could be reconciled with the U.S. proposal that the framework should not only cover cross-border movement of services, but also for the right of "service providers" to establish themselves in a host country for producing or delivering a service, and be entitled to "national treatment" and "non-discrimination vis-a-vis domestic producers of similar services".

The U.S. wanted to see as a framework "a legally binding understanding of principles that pertain to specific sectors, whatever those sectors are going to be, and having rights and obligations for signatories".

It should also provide for "meaningful trade liberalisation", and incorporate principles like "national treatment" and "transparency".

The U.S. also wanted to see a large number of countries, "both industrial and developing" as parties to the agreement, but would be disappointed if it was as few as the 20 or so in the GATT government procurement code.

Self said the U.S. wanted to see such a general framework of a binding international agreement to be reached before end of 1988, in time for the "mid-term review" or "early harvest", and the elaboration of the different sectors to be determined in the further two years of the Uruguay round negotiations.

Self said in terms of the general framework it was too early to say which sectors would be covered, but did not agree that inviting countries to sign a general agreement without defining "services" or specifying those to be included and excluded was like asking them "to buy a pig in a poke".

Asked whether labour services would be covered, Self replied the U.S. did not consider "labour per se" was a service, but there where services like "construction services" where labour was a component and which might be included.

The U.S. would however want the service agreement to cover data processing and information services, financial services including insurance and securities, construction, engineering, and some professional services like accountants, engineers and lawyers.

While the U.S. did not want to exclude any service a priori, it did not see labour genre as a service, but only labour as a component of some other service.

Asked about the exclusion in the U.S. proposals of the yardstick of "development of developing countries" or the "economic growth of all trading partners", Self said "liberalisation" and ability of consumers to utilise services with the most advanced technology at lowest possible prices, would be the most effective way to achieve development.

"We do not accept the notion that keeping foreigners out and using infant industry mechanism for generating more stable service economy will satisfy those people who need the best services".

"In any event", he added, "we have not heard specific proposals from developing countries on what specific elements about "development" they want to have.