Washington — The United States is working with a number of World Trade Organization partner economies to develop a new international agreement that would provide the foundation for consensus on liberalization of trade in services, says Deputy U.S. Trade Representative Michael Punke.
“Opening up services markets is a critical factor in supporting economic development” around the world, Punke said in prepared testimony before the House Committee on Ways and Means September 20. “Services provides both the infrastructure and the lubricant that makes the global economy work.”
He said the United States has joined with a group of 20 partners, representing both developed and developing economies, to create an International Services Agreement (ISA).
The deal would consolidate gains made in the more than 100 service agreements that have been completed since the General Agreement on Trade in Services (GATS) entered into effect in 1995, creating a comprehensive new trade deal that would lay the pathway toward further global services liberalization.
“The world has changed and our rules need to catch up,” Punke said. “By moving to a multiparty agreement that reaches across geographic regions, we would create a stepping stone from the web of bilateral and regional deals back toward the multilateral trading system.”
He added that developing new provisions and establishing high standards for market access would also provide leadership for the global trading system and influence the norms of international practice.
“In addition to these systemic benefits, the ISA also offers the potential to strengthen our economic relationships with the other participants,” Punke said. He said the United States currently has free trade deals with only 10 of the group’s members, and that the new agreement would offer a venue to work toward deeper services integration with new partners.
The deal is set to cover key infrastructure industries such as information and communications, financial services, distribution and logistics, energy and environmental services, as well as professional services like legal and accounting.
Punke said progress on the agreement has been encouraging, and the group has reached agreement on a core set of objectives. Although there is no set deadline for concluding a deal, partners are committed to moving forward as quickly as possible. Punke said the group plans to meet monthly from September through December.
Member economies currently engaged in services talks include Australia; Canada; Chile; Colombia; Costa Rica; the European Union; Hong Kong; Israel; Japan; Mexico; New Zealand; Norway; Pakistan; Panama; Peru; the Republic of Korea; Singapore; Switzerland; Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu; Turkey; and the United States.