Understanding Your Country’s Services Trade

I.2 Identifying Current Services Exports and Imports

Services trade is in large part invisible and, thus, tends to be underestimated. Nevertheless, on average across all countries, service firms are earning at least 20 per cent, running up to over 90 percent in individual cases, of foreign exchange. Some service suppliers are even unaware of their exports, especially if they trade mostly under mode 2 (i.e. services sales to foreigners visiting the country as tourists, students or patients, or to domestically established, but foreign-owned companies). Moreover, the services content of manufacturing trade, including services as diverse as finance, insurance, transport or logistics, seem to have increased significantly over time.

Subject to various “heroic” assumptions, the share of individual modes in world services trade covered by GATS has recently been estimated at:

• Less than 30 per cent for mode 1;

• close to 15 per cent for mode 2;

• over 50 per cent for mode 3, and

• some 1 or 2 per cent for mode 4.

Source: Trade in Services Section of Statistics Division, WTO Secretariat.