Relevant Services Statistics and Classifications

The ultimate purpose of trade liberalization, in whatever sectoral context, lies in its contribution to growth and development. Unfortunately, this contribution is far more difficult to trace than the immediate impacts, not always positive, on the industries most directly affected. This is a particular concern in infrastructural services, which in many countries have long been protected from competition — to the apparent benefit of the service providers directly involved and, potentially, at the expense of overall economic expansion. However, it is not only the growth and efficiency effects that are difficult to capture, information gaps already exist at the sector level.

Given the non-tangible nature of many services, sector-specific trade data are more patchy than we are used to in agriculture, mining, or manufacturing. (There may be some exceptions, such as transportation and tourism, where volume indicators are readily available.) However, the situation is gradually improving, owing in part to the impetus provided by the conclusion of GATS. After years of preparation, under the auspices of United Nations Statistical Office (UNSO), the Manual of Statistics on International Trade in Services was completed in early 2002.

The Manual extends the Balance-of-Payments based definition of international services trade to reflect the four modes of supply. In particular, a new international framework — Foreign Affiliate Trade in Services statistics — provides guidance on the measurement of services provided through foreign-owned firms in host-country markets. Nevertheless, the Manual builds on and maintains consistency with existing frameworks, including the IMF 5th Balance of Payments Manual (BPM5).

Current data problems are attributable in part to the novelty of the GATS definition of services trade and to lack of information (or interest) on part of the companies involved. Service suppliers are often unaware of their export activities in situations where they sell, for example, to foreigners visiting the country. By the same token, the services “imported” via foreign commercial presence, i.e. the turnover in their host countries of foreign-owned telecom companies, banks, hotels, etc., have long escaped statistical coverage.

For the purposes of the Uruguay Round negotiations, the WTO Secretariat developed a services sector classification with a view to ensuring cross-country comparability and consistency of the commitments undertaken (MTN.GNS/W/120, (7 pages, 47KB)). Although optional, most Members followed this classification which, in some sectors (maritime transport, financial services, telecommunications) was complemented by alternative models. As far as possible, the 160-odd sub-sectors of which W/120 is composed, are defined as aggregates of the more detailed categories contained in the United Nations provisional Central Product Classification (CPC). Recourse to CPC-categories helps to improve clarity over the scope of the commitments actually undertaken; for each sector number, the CPC provides a brief description of what is actually covered.