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Tánaiste Leo Varadkar Welcomes the Conclusion of the WTO Joint Statement Initiative

Tánaiste and Minister for Enterprise, Trade and Employment, Leo Varadkar TD has welcomed the conclusion of negotiations by 67 WTO Members on a joint statement initiative aimed at reducing barriers to Services Trade among participating countries.

In welcoming the conclusion of negotiations, the Tánaiste stated that “despite last Friday night’s postponement of the WTO’s biennial Ministerial Conference due to COVID-19, the work of the WTO continues. This Joint Statement Initiative agreed among 67 WTO Members, including Ireland, will facilitate greater trade in services which is really valuable for Ireland as services represent 58% of our Exports.”

The countries that have signed up represent over 90% of global trade in services indicating the potential impact that this Agreement should have for people and businesses working in the services economy. The OECD has estimated that annual cost savings could amount to $150 billion globally due to the reduction of red tape and increased transparency. Ireland’s trade in services is growing year-on-year and in 2020, Ireland’s services exports were valued at €229 billion. So this Initiative which sets out agreed rules and principles should further aid our services exporters and those employed in the services economy.”

The new rules agreed cover increased levels of transparency by Licencing Authorities when advertising and evaluating licence applications from enterprises supplying foreign services in local markets of the parties to the agreement. The Agreement also contains new disciplines relating to licencing requirements and procedures, qualification requirements and technical standards affecting trade in services, thereby bringing greater clarity to market access requirements for our services exporters in a range of key markets.

The Tánaiste continued, “rule-making is an important function of the WTO. When rules such as licensing requirements are unclear and unpredictable, this can result in highly qualified service providers being unable to access foreign markets in a fair and non-discriminatory manner. The Agreement reached today aims to reduce this gap.”

The Tánaiste also highlighted that “this is the first time that a WTO text contains a provision on non-discrimination between men and women in authorisation procedures for service suppliers and is designed to boost female participation in services trade. This is obviously a very welcome development in our continued pursuit of gender equality and encouraging female entrepreneurship in the global economy.”

The Services Domestic Regulation refers to the requirements, procedures, and applicable technical standards for qualification and licenses for service providers including businesses and individuals, such as architects, lawyers, and financial institutions etc. The WTO Joint Statement Initiative on Services Domestic Regulation was initiated by nearly 60 members at the 11th Ministerial Conference Meeting in December 2017 to discuss simplification and transparency of requirements and procedures to avoid becoming trade barriers. The Initiative was discussed amongst interested WTO Members as part of a programme of WTO-related activities in preparation for the 12th Ministerial Conference (MC12).

The Agreement was due to be concluded during the WTO’s Ministerial Conference in Geneva from 30 November to 3 December which was postponed due to travel restrictions and concerns regarding COVID-19 variants. A new date for a rescheduled MC12 has yet to be confirmed.

The disciplines will apply to sectors where participating countries have undertaken commitments in their WTO General Agreement on Trade in Services (GATS) “schedules of commitments”. Members can voluntarily expand the application of the disciplines to additional sectors.

Developing economies that subscribe to the disciplines can delay the application of specific provisions in sectors in which they face implementation difficulties for up to 7 years. The use of transitional periods would allow them to make any necessary adjustments to their domestic regulatory frameworks.

Least-developed countries (LDC) participating in the Initiative are not required to apply the disciplines until they graduate from LDC status and can designate the necessary transitional periods at that time.

The disciplines will become binding only on those WTO members who inscribe them into their GATS schedules. They will be applied on a “Most Favoured Nation” (MFN) basis, meaning that services suppliers from all WTO members will be able to equally benefit from them.

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