The WTO LDC Group reported on a declaration adopted by LDC trade ministers on 19 October outlining LDC priorities for MC12 and beyond. The declaration calls, among other things, for a number of steps to be taken in relation to the LDC Services Waiver.
Adopted at the 2011 Ministerial Conference, the waiver allows governments that so wish to grant more favourable treatment for LDC services than that given to all other members. Its purpose is to enhance the LDCs' participation in world services trade.
A total of 36 WTO members are classified as LDCs. To date, 51 members have granted preferences in favour of LDCs.
Services trade concerns
Members raised six specific trade concerns previously addressed at the Council for Trade in Services.
- Japan and the United States, echoed by Australia, Canada and the European Union, reiterated concerns about cybersecurity measures of China and Viet Nam.
- China recalled its concerns about Australia's 5G measures.
- The United States, echoed by Canada, the European Union and Japan, once again raised concerns related to Russia's software pre-installation measure.
- China repeated concerns with certain US measures related to certain Chinese mobile applications.
- China reiterated its concerns regarding services trade measures of India.
- The United States, echoed by the European Union, restated its concerns regarding a measure on the localization of customer services in Saudi Arabia.
Members raise specific trade concerns to find out more about the scope and application of each other's measures in light of their General Agreement on Trade in Services (GATS) obligations. Compliance with WTO rules, the availability to engage with the members concerned and the need to meet national policy objectives or to protect national security were among the replies provided by the members whose measures were addressed.
E-commerce Work Programme
Members continued sharing views on electronic commerce under the Work Programme, reiterating their contributions to past discussions and calling for the exchange of information and experiences in the Council to advance further.
The need for increasing digital capabilities in developing countries to reduce the “so-called” digital divide was highlighted. Different opinions were expressed on the extension of the moratorium on e-commerce after the 12th Ministerial Conference (MC12). Members have been agreeing not to impose customs duties on electronic transmissions at previous Ministerial Conferences.
Latest trends in services trade
Services trade experienced the worst-ever decline in 2020 since estimates for world trade in services started being produced, members learnt from a presentation by the WTO Secretariat. Global services trade declined on average by 21 per cent in 2020, with LDCs' services exports falling by as much as 35 per cent. Services trade has been hit harder by the crisis than trade in goods overall, and short-term statistics, particularly on travel, confirmed this trend.
By contrast, freight transport had recovered quickly due to high demand for goods particularly in developed economies. Coupled with shipping delays and port congestions due to COVID-19 related measures, and a global misallocation of empty containers, this had resulted in 2021 in a sharp increase in shipping prices especially on certain trade routes, e.g. between Asia and North America. An expected cooling of import demand in the coming months should ease some pressure on goods trade. However, shipping prices will remain high in the short term.
Further data can be found here.
Container shortages and increased shipping rates
Members noted the steep rise in shipping costs and container shortages. The issue was included by Mongolia under “Other Business” of the Council's agenda to raise awareness on the impact of COVID-19 on maritime transport services and global supply chains.
Implementing commitments under the GATS
The Committee on Specific Commitments continued examining the implementation of GATS commitments at a meeting on 18 October. Thailand announced it would update its schedule of services commitments to include its 2006 Telecommunication Business Act 2006 and other relevant laws and regulations and initiate the certification process.
The review of commitments is carried out on a voluntary basis and based on a 2020 proposal from the United States. Under examination are members' “conditional” commitments, under which the entry into force, implementation or updates of specific commitments depends on national legislative actions or policy reviews. The objective of this exercise is to improve the transparency and legal certainty of members' specific commitments.
Members also heard from the United Nations Statistics Division about a new visualization tool for comparing different versions of the “Central Product Classification” (CPC), an internationally-agreed mechanism for classifying goods and services. The CPC displays data on industrial production, domestic and foreign commodity trade, international trade in services, balance of payments, price statistics, etc.
The Committee on Specific Commitments is a subsidiary body of the Council for Trade in Services.
Role of logistics services and digitalization in post-pandemic recovery
The COVID-19 pandemic has highlighted the critical role played by logistics services in supporting trade and the global economy. It has also underscored the important role that digitalization plays in strengthening logistics and supply chain resilience as part of the post-pandemic economic recovery. This was the focus of a webinar organized by the WTO's Trade in Services and Investment Division on 15 October as part of the “Simply Services” series. More information is available here.
The speakers pointed to the role of the world trading system in facilitating logistics services and digitalization and strengthening supply chains. Paperless trading, market access, interoperability, digital platforms and capacity-building were cited as essential to respond to the challenges that a fast and expanding digitalization is posing to the logistics industry.
Experts working in express delivery, freight forwarding, e-commerce logistics, port operation and digital standards shed light on the lessons learned from the crisis, the challenges lying ahead and the trade governmental policies that could help address those challenges.
The opening remarks given by Deputy Director-General Anabel González can be found here.