External Trade

Economic Integration in the EUROMED

context

National Conference onHarnessing Services for Sustainable Development

Amman, 22 September 2010 Christophe RAMESEuropean CommissionDG TRADE

External Trade

Overview1. Services and investment as main

vehicles for deeper integration2. Economic opportunities3. Liberalizing trade in services

between EU and Jordan: key features4. Negotiating a Services Agreement

between EU and Jordan: State of play and way forward

External Trade

1. The Need for Deeper Integration• 15 years after Barcelona, need to shift Euromed

integration into a higher gear

- Euromed Association Agreements will lead to a ‘shallow’ free-trade area if limited to goods

- Services account for 2/3 of GDP in Jordan and ¾ of GDP in EU

• To maintain a privileged partnership, deeper integration is needed.

External Trade

1. What is at stake?• Barriers to trade in goods = tariffs and quotas• Barriers to trade in services = rules and

regulations • Liberalizing trade in services requires ‘behind-the-

border’ policy reforms• Services trade is strongly associated with FDI and

knowledge-spill overs.

Trade liberalization in services should be used as anchor for domestic reforms and as vehicle for deeper regional integration

External Trade

2. Economic opportunities of services & investment

• Attracting FDI• Improve competitiveness• Better functioning markets • Support to regulatory environment• Predictable rules and legal certainty for business• Benefits for consumers (e.g. telecom)

Liberalizing trade in Services and Investment is the most powerful vehicle for economic growth and integration

External Trade

2. Key sectors for growth & developmentInfrastructure services:

• Telecoms, Postal and Courier• Transports• Energy distribution network• Financial services

but also• Tourism • Logistics & distribution• Business services• Construction• Environmental services

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3. Trade liberalization in services in a bilateral context: The EU approach

• Building on GATS- Compatibility with WTO rules - GATS schedules as starting point for offers

• Deepening GATS Commitments (WTO +)

• Ensuring flexibility to take account of level of development and sensitivities

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3. Liberalizing trade in services between EU and Jordan: What does it mean?

Three keys aspects:

Progressivity

Reciprocity

Asymmetry

External Trade

3. Liberalizing trade in services between EU and Jordan: What would be covered?Scope:

- Services and Establishment- Services as defined by GATS art. I- 4 modes of supply- Establishment in services and non-services sectors

• GATS approach:- Positive listing- MA and NT commitments

• Regulatory provisions in key Sectors

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3. Liberalizing trade in services between EU and Jordan: What would not be covered?• All sectors are likely to be covered with a few

exceptions . All modes of supply as defined in GATS.

• Mode 4 = temporary movement of natural persons supplying services, i.e. professionals highly qualified

•Non-qualified workers, persons seeking access to employment market fall outside the scope of Mode 4 commitments

• The FTA applies to trade matters only. Non-trade matters are not covered (e.g.,citizenship, immigration, visas …)

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3. Liberalizing trade in services between EU and Jordan: Others key elements• Framework for mutual recognition of qualification

and professional experience

• Domestic Regulation: Framework for transparent and non-discriminatory rules

• Investment: MA and NT in Mode 3 in services and non-services sectors. NB: measures other than those deriving from MA and NT not covered

External Trade4. Negotiating a Services Agreement between EU and Jordan: State of play and way forward• Regional phase (2007): discussion of a regional

common protocol- to ensure coherence- to enhance regional integration

• Bilateral phase (2008 – today): launch of bilateral negotiations with Egypt, Morocco, Tunisia, Israel

• With Jordan: Scoping exercise to define contours of agreement

External Trade

4. Opening negotiations on services between EU and Jordan: What is needed?

• Support from industry

• Legal capacity

• Technical expertise

• Political will

External Trade

Thank you for your attention

More info: http://ec.europa.eu/trade