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At the aggregate level the drop in international trade is one the worst since the mid-1960s. In the first quarter of 2009, the value of total goods exports in OECD countries fell by a seasonally adjusted 15.1% compared with the previous quarter. In late 2008 and the first half of 2009, however, trade in services seems to have effectively 'decoupled' from goods trade, with some OECD countries actually experiencing more resilient services exports. In the context of the economic crisis, we are also increasingly faced with the question how countries might ' push the protectionist button' when it comes to trade in services, what particular form this could take, and if WTO agreements are geared to prevent this.
All this goes to show that even after close to 15 years of research relating to the GATS, services are still 'different' from goods, special and mysterious - requiring study as offered by this book.
This volume of essays edited by Juan Marchetti and Martin Roy focuses, not on the economics of services, but rather on the process, achievement, and challenges of service trade negotiations. As such, it is essential for trade negotiators and very usefully complements recent publications on the topic. 1 The contributors are very prominent, notably the uniquely qualified Secretariat of the WTO Trade in Services Division and of the World Bank Development Research Group.
The volume is divided into four parts with a short section on the economics of services trade, two parts covering the analysis of developments and challenges in general and sector-specific trade negotiations, and the final part on country case studies.
Chapter 1 by Hoekman and Mattoo provides the economic background to the rest of the book. It reviews recent global trade in service trends, the linkages between services and growth, the impacts of service trade liberalization, and policy implications. As such, it clearly uncovers the topics in which the greatest analytical gaps still exist.
Problems are the steadily improving, but still notoriously weak services trade data and a lack of analysis and metrics to capture the complex role of services in the economy (including in global value chains, for innovation, and as intermediate inputs into goods production). Importantly, the chapter shows...