Emergency Safeguard Measures in GATS
Policy Options for South Asia
Center for Trade and Development | March 19, 2008
The General Agreement on Trade in Services (GATS), concluded in 1994, was the first attempt to negotiate rules in global services trade at the multilateral level. In the 1990s, the share of services trade in global trade was rising. Innovations in telecommunications led to newer means of trading services across distances. Global services multinationals spread operations in a large number of countries. With the growing volume of services trade, it was thought necessary to reduce trade barriers and promote services liberalization.
During the Uruguay round, which led to the formation of the WTO, most developing countries were opposed to the idea of a services agreement. The result was a negotiated bargain wherein GATS and TRIPS would be a part of the single undertaking, while the OECD countries would open their economies for textiles, agriculture and labour-intensive manufactured goods from the developing countries. Within GATS also, Article X on Emergency Safeguard Measures (ESMs), was a part of the balance struck, which led the developing countries to accept the GATS commitments. The negotiations on ESMs have continued for 12 years, yet differences amongst Member countries on key issues have stalled forward movement. This paper is an attempt to understand whether the South Asian countries, with their mixed experiences of the services economy, can develop a common position regarding ESMs.
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