Procedure : 2008/2004(INI)
Document stages in plenary
Document selected : A6-0283/2008

Texts tabled :

A6-0283/2008

Debates :

PV 03/09/2008 - 17
CRE 03/09/2008 - 17

Votes :

PV 04/09/2008 - 7.6
Explanations of votes
Explanations of votes

Texts adopted :

P6_TA(2008)0407

REPORT     
PDF 162kWORD 131k
2.7.2008
PE 405.975v02-00 A6-0283/2008

on Trade in services

(2008/2004(INI))

Committee on International Trade

Rapporteur: Syed Kamall

EXPLANATORY STATEMENT
 OPINION of the Committee on Economic and Monetary Affairs
 OPINION of the Committee on the Internal Market and Consumer Protection

EXPLANATORY STATEMENT

INTRODUCTION

This report aims to highlight the importance of trade in services as a creator of wealth and jobs for all economies around the world, as well as a catalyst for development. Services provide the backbone to economies and trade around the world, not only as a means to creating wealth in itself, but also in providing vital support to the economy and industry as a whole through, for example, finance, logistics and communications.

The term "Trade in Services" covers a huge range of industries, making it impossible to try and incorporate them all into one report. Therefore, this report will focus on the broader themes of services, including GATS and bilateral and regional trade agreements, as well as a few examples of sector specific issues.

SERVICES AS PART OF AN ECONOMY

Today's level of globalisation and rapid technological advancement require more than ever that attention be given not only to trade in physical goods, but also trade in services. Studies repeatedly show that services make up an ever increasing percentage of GDP of nearly every economy, 75% for EU, 78% for North America, 52% for Africa and 60% for Asia.

While trade in goods relies to a great extent on an efficient services economy, this does not mean that trade in services should be treated in the same way. Indeed, because financial, communications, and professional services are key intermediate inputs into production in all sectors, technological improvements in these sectors could have the effect of upgrading overall productivity. Thus, whereas liberalising trade in goods moves an economy towards specialisation, opening up trade in services through permitting foreign investment could lead to increased and balanced output as well as better infrastructure for all sectors of the economy.

This report stresses that services are not the preserve of richer countries but are an important and growing part of any economy. The huge potential for growth through services in poor countries has been set an excellent example by the boom in African and South American telecoms, which has shown the progress that can be made through liberalisation and competition. The telecoms boom also highlights the knock on effects that liberalisation of services can have, boosting trade and facilitating globalisation giving entrepreneurs and citizens of poorer countries access to communications and information that would otherwise be unavailable.

It is important to stress that opening up trade in services does not mean privatisation. Individual governments of countries, should they so wish, can still offer a state-run bank, state-run telecommunications or state-run water services, yet they may still prevent local and foreign entrepreneurs or companies from offering competing services alongside, even though non-state provision of services could supplement rather than hinder many public services.

The author recognises that it is important that citizens are offered access and choice, particularly in poorer countries where the local or national governments do not have the funds or even sometimes the inclination for decent service provision. For example, in some cases, governments do not have the capacity to provide clean water to residents of slums. There have been studies which show that many of the poor who live in slums can and indeed do pay for privately provided water, even if tariffs might seem initially quite high. This is because it is often still lower than what they had to pay to middlemen for water that was unsafe and unreliable. However, alternative providers could simply be local entrepreneurs and not neccesarily foreign providers. Furthermore, opening up of trade in financial services for example would mean that citizens would not have to rely on one single bank for a loan, which might be run by an associate or family member of a corrupt government. Likewise, citizens often welcome the opening of media services since this leads to user choice and increased freedom of expression. The author is critical of instances where the notion of cultural diversity is used as an excuse to shut out or shut down competing media service providers in order to maintain a monopoly state broadcaster churning out state propaganda.

GATS AND OTHER BILATERAL AND REGIONAL AGREEMENTS

The current Doha Development round of the WTO is currently in deadlock following disagreements over agriculture. This report reminds readers that agriculture - while an important sector for human survival - is but a small percentage of GDP and should not hold up the opening of other important sectors of the global economy. The EU should demonstrate moral leadership by cutting those tariffs and subsidies that hinder trade in physical goods and agriculture in order to achieve the bigger prize of trade in services, which is vital not only for EU producers and consumers but also for citizens of poorer countries.

The multilateral deadlock has meant that the many countries, including that EU are going ahead with bilateral and regional agreements. The commitments negotiated in the Economic Partnership Agreement signed with the CARIFORUM have shown a clear willingness to put services on the agenda. The agreements on mode 4 should hopefully address the brain drain, as well as the "brain in a drain" problem, where educated people in poorer countries are unable to apply their skills locally owing to lack of opportunities.


OPINION of the Committee on Economic and Monetary Affairs (9.6.2008)

for the Committee on International Trade

on Trade in services

(2008/2004(INI))

Draftsman: Olle Schmidt

SUGGESTIONS

The Committee on Economic and Monetary Affairs calls on the Committee on International Trade, as the committee responsible, to incorporate the following suggestions in its motion for a resolution:

1.  Notes that services, in particular financial services, affect many fields of competence and underlines that the focus of this Resolution is on trade in services, i.e. achieving market access by the voluntary opening of markets through the request and offer method of negotiations; suggests that areas such as financial supervision, regulation and other issues dealing with different aspects of financial services should be dealt with in the appropriate forum;

2.  Strongly supports the Commission's view that market access and free trade in services are an essential component of the Lisbon agenda for growth and jobs; underlines that open markets in combination with balanced and regulated free trade in services will benefit all participating countries and regions;

3.  Notes that European companies are increasingly active internationally, that global economic growth is, to a large extent, driven by third countries, and that improved market access would therefore contribute towards strengthening the European Union's competitiveness;

4.  Considers that trade in services is a necessary complement to trade in goods and that they should not be considered as distinct from one another;

5.  Considers that the service economy has become the most quantitatively important economic sector in the OECD economies and that increased trade and availability of services will increase economic growth and facilitates business growth and development, improving the performance of other industries, as services provide key intermediate inputs especially in an increasingly interlinked globalised world;

6.  Recognises that achieving market access for services is a difficult process within the ongoing WTO Doha Development Agenda negotiations; calls on the Commission to pursue a balanced package with an ambitious offer in services, especially in financial services, where the European industry has competitive expertise and has a strong potential for growth; Notes that compliance with rules and standards is necessary in order to prevent non-tariff barriers, which may be sensitive in the area of services;

7.  Calls on the Commission to take full account in trade negotiations of the existence of general interest services and the potential impact of market opening on their organisation;

8.  Notes that with regard to financial services, the EU has one of the most open markets in the world, but underlines that the European Union has to pursue more offensive and balanced trade in services negotiations and endorse the principles of openness, development and reciprocity;

9.  Stresses the importance of financial service authorities keeping pace with all developments on the European and global financial services markets; calls on the Commission and the Member States to enhance the European regulatory frameworks, as well as to intensify the regulatory dialogue between the European Union and its trading partners with the aim of reducing trade barriers;

10. Calls on the Commission to look into the "offshore" practices of third countries which jeopardise a mutually beneficial opening up of markets;

11. Calls on Member States to work towards a more integrated and coherent trade policy with the Commission, in particular in the area of investments; points out that Member States should not overstate the risks of foreign investment, but aim for effective openness of their economies, and for a common approach in the context of sovereign wealth funds; takes note of the need to evaluate issues such as security of supply, especially concerning foreign investments in the energy sector made by state-owned entities, recalls that such evaluation cannot be used as a protectionist measure;

12. Draws the Commission’s attention to the potential risks, with regard to compliance with the competition rules within the European Union, due to the lack of reciprocity in the WTO agreement on public procurement;

13. Calls on the Commission to take stronger action against counterfeiting, particularly via the Internet, inter alia, by encouraging better cooperation between national administrations;

14. Supports the Commission's strong support for multilateral trade negotiations, but notes that for trade in services, especially concerning financial services, free trade agreements may be better suited for achieving market access; strongly supports the achievement of full Economic Partnership Agreements with the ACP countries that cover not only goods but also services and investment, thus enabling those countries' integration in the global economy;

15. Underlines that effective market access for financial services creates better opportunities for competition, transparency and diversification; notes that, in the emerging economies in particular, effective market access could lead to a stronger local financial market development for the benefit of firms wishing to establish themselves, as well as provide consumers with more choice and better products;

16. Mindful of the weak financial, administrative and institutional capacity of the ACP countries, invites the Commission to ensure respect for the internationally agreed standards for regulation and supervision in the financial services sector when negotiating and implementing trade agreements with countries that are considered to be tax havens;

17. Considers that access to financial services (micro credits, access to bank accounts, basic banking services, mortgages, leasing and factoring, insurance, pensions and local and international transfers), in particular, is necessary for individuals in developing countries to engage in basic economic activities, and therefore asks the Commission to promote better market access for financial services in developing countries and to encourage sound prudential regulation, the development of competitive markets and financial services education.

RESULT OF FINAL VOTE IN COMMITTEE

Date adopted

3.6.2008

 

 

 

Result of final vote

+:

–:

0:

34

1

0

Members present for the final vote

Mariela Velichkova Baeva, Zsolt László Becsey, Pervenche Berès, Sharon Bowles, Udo Bullmann, Manuel António dos Santos, Jonathan Evans, Elisa Ferreira, José Manuel García-Margallo y Marfil, Jean-Paul Gauzès, Donata Gottardi, Benoît Hamon, Karsten Friedrich Hoppenstedt, Othmar Karas, Piia-Noora Kauppi, Wolf Klinz, Christoph Konrad, Guntars Krasts, Kurt Joachim Lauk, Andrea Losco, Florencio Luque Aguilar, John Purvis, Alexander Radwan, Bernhard Rapkay, Dariusz Rosati, Eoin Ryan, Antolín Sánchez Presedo, Olle Schmidt, Peter Skinner, Margarita Starkevičiūtė, Ivo Strejček, Ieke van den Burg

Substitute(s) present for the final vote

Mia De Vits, Harald Ettl, Margaritis Schinas


OPINION of the Committee on the Internal Market and Consumer Protection (28.5.2008)

for the Committee on International Trade

on Trade in Services

(2008/2004(INI))

Draftsman: Cristian Silviu Buşoi

SUGGESTIONS

The Committee on the Internal Market and Consumer Protection calls on the Committee on International Trade, as the committee responsible, to incorporate the following suggestions in its motion for a resolution:

1.   Recalls that services account for more than three quarters of the European economy and that many services are vital for competitiveness and innovation in other sectors of the productive cycle such as industry and agriculture;

2.   Considers that, in establishing fair trade in services it is necessary to ensure compliance with the principles set out in Article 2 of the EC Treaty;

3.  Takes the view that an effectively functioning internal market in services is important for the global competitiveness of EU enterprises; stresses that the timely and correct implementation and transposition of Community legislation, including Directive 2006/123/EC on services in the internal market(1), is important to this end;

4.  Believes a balanced and ambitious enterprise policy, in particular the European Small Business Act, could reinforce the competitiveness of SMEs; calls for the forthcoming initiative to cover also the needs of the service sector and favours a legislative instrument;

5.  Recalls the importance of services for the European economy and express concern at the lack of progress on services in the current negotiation round in the World Trade Organisation; 

6.  Notes that the lack of skilled workers is an emerging challenge for the service sector in Europe and that there is a need to develop measures to tackle this, inter alia by way of lifelong education and training for workers;

7.  Underlines that the services sector can bring many solutions to environmental problems and believes they are one of the main elements of added value in the EU's exportation of know-how; underlines that the importance of the services sector needs to be taken into account when designing a policy for sustainable development;

8.  Welcomes the Commissions' emphasis on ensuring that the positive effects of globalisation are passed on to consumers; stresses that, in combination with a high level of consumer protection, fair competition in services is crucial to ensure that consumers benefit from the European open market.

RESULT OF FINAL VOTE IN COMMITTEE

Date adopted

27.5.2008

 

 

 

Result of final vote

+:

–:

0:

36

0

0

Members present for the final vote

Cristian Silviu Buşoi, Charlotte Cederschiöld, Gabriela Creţu, Janelly Fourtou, Evelyne Gebhardt, Martí Grau i Segú, Małgorzata Handzlik, Malcolm Harbour, Iliana Malinova Iotova, Pierre Jonckheer, Graf Alexander Lambsdorff, Kurt Lechner, Toine Manders, Nickolay Mladenov, Catherine Neris, Zita Pleštinská, Zuzana Roithová, Heide Rühle, Leopold Józef Rutowicz, Salvador Domingo Sanz Palacio, Christel Schaldemose, Andreas Schwab, Marianne Thyssen, Bernadette Vergnaud, Barbara Weiler

Substitute(s) present for the final vote

Emmanouil Angelakas, Wolfgang Bulfon, Colm Burke, Giovanna Corda, Jan Cremers, Wolf Klinz, Manuel Medina Ortega, Gary Titley

Substitute(s) under Rule 178(2) present for the final vote

Elisabeth Morin, Sirpa Pietikäinen, Nicolae Vlad Popa

RESULT OF FINAL VOTE IN COMMITTEE

Date adopted

24.6.2008

 

 

 

Result of final vote

+:

–:

0:

19

11

0

Members present for the final vote

Francisco Assis, Graham Booth, Carlos Carnero González, Daniel Caspary, Françoise Castex, Christofer Fjellner, Béla Glattfelder, Ignasi Guardans Cambó, Jacky Hénin, Syed Kamall, Marusya Ivanova Lyubcheva, Erika Mann, David Martin, Vural Öger, Georgios Papastamkos, Godelieve Quisthoudt-Rowohl, Tokia Saïfi, Peter Šťastný, Robert Sturdy, Gianluca Susta, Iuliu Winkler, Corien Wortmann-Kool

Substitute(s) present for the final vote

Vittorio Agnoletto, Eugenijus Maldeikis, Jan Tadeusz Masiel, Salvador Domingo Sanz Palacio, Carl Schlyter

Substitute(s) under Rule 178(2) present for the final vote

Marie-Arlette Carlotti, Małgorzata Handzlik, Christopher Heaton-Harris

(1)

OJ L 376, 29.12.2006, p. 36.

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