New Services Regulatory Information will Support Africa’s Economic Diversification, WTO DG

· WTO released new services regulatory surveys and quantifications of African services trade policies on the occasion of a conference held at the WTO on 27 February.

· Conference entitled “Services Trade Policy in Africa — Leveraging regulatory surveys for trade negotiations and policy”

The World Bank and the WTO released new services regulatory surveys and quantifications of African services trade policies on the occasion of a conference held at the WTO on 27 February. Participants discussed how increased involvement in services trade can support economic development and export diversification of African economies. Delivering the keynote speech, Director-General Ngozi Okonjo-Iweala said: “In Africa, services trade offers promising opportunities, such as economic growth, poverty reduction, job creation and trade diversification. Still, most of those opportunities remain untapped.”

The joint World Bank and WTO surveys cover the policies and regulations applied by 54 African economies to the supply of different services into their markets through various modes of supply. It is the first time that information on the services trade policies of these economies has been simultaneously brought together. The surveys cover various aspects of measures affecting trade in services, such as market access, operations, competition, licensing requirements and procedures, regulatory transparency, cross-border data transfer and data localisation issues. Trade policies in 34 services subsectors are examined, representing approximately two-thirds of the service economy in these countries.

The joint World Bank/WTO Services Trade Restrictions Indices (STRI) quantify the level of restrictiveness of these countries' services trade policies based on the regulatory information revealed in the surveys. It is calculated for 34 subsectors and relevant modes of supply. The surveys and the STRIs are available through the Services Trade Policy Database, which can be accessed here.

The Conference entitled “Services Trade Policy in Africa — Leveraging regulatory surveys for trade negotiations and policy” served as a platform for the public release of the regulatory surveys and STRIs of African countries and the presentation of the main results. The event also provided an opportunity for experts from national governments, international organizations and the trade research community to discuss how best to promote services trade in the continent and enable African countries to reap the benefits that services may bring to economic diversification and growth.

Most African economies are striving to diversify their exports, which tend to be concentrated at the lowest levels of global value chains. Two-thirds of African services exports are concentrated in the transport and travel sectors, which are less dynamic and shock-resilient than other commercial services whose trade has surged over the last decade thanks to digitalisation. Furthermore, while the share of services in total African exports have grown over the last 15 years, the continent's share of global services trade remains low, below 2 per cent.

“Services are the backbone of modern economies and the most dynamic component of international trade,” DG Okonjo-Iweala said. “The service sector on average accounts for about 50 per cent of GDP across Africa. Services absorb a large proportion of employment, in particular of youth and women — making the sector central to future economic development and gender parity.” Citing different examples, the DG said: “We have considerable reasons to believe the African market is more dynamic than the official statistics show.”

“For the developing economies, particularly those of Africa, the rise of services opens up immense opportunities to diversify their economies and trade, contributing to sustainable development,” WTO Deputy Director-General Anabel González said in her opening remarks to the Conference.

The importance of data collection and up-to-date information on services trade policy and regulations was emphasized as well as the need for improved transparency to attract investors to the continent.

DG Okonjo-Iweala said: “Lack of comprehensive information on services trade policies and regulations have eluded African governments and trade negotiators for a long time.” In conducting the extensive regulatory surveys presented this morning, she said, the WTO and the World Bank, supported by the German Ministry for Economic Cooperation and Development, the International Trade Centre and the European Union, have made an extraordinary contribution to all services trade negotiations in which African countries participate. DG Okonjo-Iweala added: “I also hope that in supporting negotiations and policy reform, this work will spur more research on trade in services policy.”