November 30, 2005 IN THIS ALERT: Lamy Releases Draft Hong Kong Ministerial Text Global Services Coalition Roundtable in Hong Kong, Dec 15 Report by CTSSS Chairman to Trade Negotiations Committee Report by Working Party on Domestic Regulation APEC Leaders Back Completion of WTO Round WTO Working Paper on Mode 4 Lamy Releases Draft Hong Kong Ministerial Text WTO Director-General Pascal Lamy has released the draft Hong Kong Ministerial Declaration, which incorporates the third draft of the WTO Ministerial services text prepared by Fernando De Mateo, the Chairman of the WTO Council for Trade in Services in Special Session (CTSSS). Though the services text calls for improved commitments in all four modes of service supply, the US and others have criticized it as insufficiently ambitious, particularly with regard to mode 3. The text also did not include a reference to numerical targets and indicators for services which had appeared in earlier drafts.  This prompted sharp criticism from the EU, which has been the leading advocate for numerical targets. In addition, the draft includes language calling for more focused discussions on possible emergency safeguard measures, and on rules for government procurement and the use of subsidies in the services sector.   Click here for a copy of the full draft Ministerial declaration, including the services language, click here. The WTO Secretariat also prepared a paper last week on possible sectoral and modal objectives for the negotiations. It is a compilation of various submissions by WTO Members, and was commenced under Ambassador Jara's Chairmanship of the CTSSS.  Click here for a copy. Global Services Coalition Roundtable in Hong Kong, Dec 15 The Global Services Coalition is organizing a services roundtable discussion in Hong Kong on December 15, during the WTO Ministerial.  The event will include senior services negotiators from key countries including the EU, India, US, and others, and will provide a variety of perspectives on the major challenges in the services negotiations, and the issues standing in the way of greater progress.  Click here for a copy of the agenda and to register.  (Note: those wishing to attend must be registered for the Hong Kong ministerial through an accredited NGO).   Report by CTSSS Chairman to Trade Negotiations Committee The Chairman of the Council for Trade in Services in Special Session has released his pre-Hong Kong report to the WTO Trade Negotiations Committee (TN/S/23).  The report contains a Chairman's commentary on some parts of the services text for Hong Kong, including areas of particular controversy.  In the report, CTSSS Chairman Fernando De Mateo says that the services text "provides a sound basis for pursuing the negotiations to their conclusion. It attempts to bridge gaps between positions on the different elements it contains in a manner which, I hope, achieves an acceptable balance."  Click here for a copy. Report by Working Party on Domestic Regulation On November 15, the Chairman of the WTO Working Party on Domestic Regulation (WPDR) issued a report to the CTSSS, reviewing the status of work in the WPDR, including recent rounds of discussions on licensing requirements and procedures, qualification requirements and procedures, technical standards, and other topics. It also includes an illustrative list of possible elements for disciplines on domestic regulation. Click here for a copy of the report. APEC Leaders Back Completion of WTO Round At their annual meeting in Korea on November 18-19, 2005, APEC leaders said that the Doha Round must be carried to a successful conclusion, at the high level of ambition established in the Doha Declaration, by the end of 2006. "Significant progress must be made in Hong Kong in resolving still remaining considerable divergences and a clear roadmap for completion of the Round in 2006 must be established," leaders said in a joint statement. On services, leaders said that an ambitious and balanced outcome will include an agreement in services that will create commercially meaningful and real market access opportunities in all WTO Members.  The statement called for breaking the impasse in agricultural negotiations, "in particular in market access, which will unblock other key areas, including non-agricultural products and services."  Click here for a copy of the APEC Leaders Statement. WTO Working Paper on Mode 4   A recent WTO working paper entitled "The Impact of Mode 4 Liberalization on Bilateral Trade Flows" gives insights into the possible trade creating effects of service trade liberalization via Mode 4. The paper says that temporary movements of persons have the potential to reduce transaction costs for merchandise trade between home and host country.  Using data on H-1B beneficiaries from different origins in the United States, and using a gravity model of trade, the paper finds significantly positive effects of temporary movements of persons on bilateral merchandise trade.  Click here for a copy of the paper.