UNCTAD
CULTURAL SERVICES IN
INTERNATIONAL TRADE:
IMPLICATIONS FOR
DEVELOPING COUNTRIES
Trade Negotiations and
Commercial Diplomacy
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UNCTAD
WHAT ARE CULTURAL
SERVICES?
• Under the classification list of the GATS
(MNT.GNS/W/120), recreational, cultural sporting
and educational services are listed as sectors.
Audiovisual services are listed as a subsector.
• Characteristics of public goods:
- Non excludable
- Non rivalrous in consumption
- Highly susceptible of market failures but it is
difficult to make a difference between public and
private goods.
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UNCTAD
PROVISIONS UNDER THE
GATS CONCERNING
CULTURAL SERVICES
• No general exemption for cultural services
• The positive list approach gives options to
countries for their lists of commitments: MFN,
National Treatment, Additional commitments. De
facto exemption.
• Article IV of the GATS allows for screen quotas
• Article XX (f) of the GATT allows trade
restrictive measures to protect national treasures
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UNCTAD
PROVISIONS UNDER THE
GATS CONCERNING
CULTURAL SERVICES
• Art. XIV (a) of the GATS and Art. XX (a) of
the GATT allows trade restriction measures
necessary to protect public moral.
• Need for clarification and in particular to
determine the scope of the coverage of the
GATS as far as governmental activities are
concerned.
ie. Article 1.3 (b) of the GATS defines services
as any sector except services supplied in the
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exercise of governmental authority
UNCTAD
EDUCATIONAL SERVICES
• Need
for
clarification
for
governmental
intervention, i.e. Art. I.3.c of the GATS: « a
service supplied neither on a commercial basis
nor in competition with one or more service
suppliers »
• The scope of government activity is considered to
be limited to basic education, meaning priary and
secondary school
• In the on-going negotiations, the USA is the
demandeur in order to reduce the barriers to
supply higher education services and adult
education (modes 1, 2 and 4)
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UNCTAD
EDUCATIONAL SERVICES
• Education services are traded predominantly
through
student
mobility
across
borders
(consumption abroad)
• A more recent form in which education services
are traded consists of the setting up of facilities
abroad by education providers (commercial
presence)
• Lack of data for cross-border supply and presence
of natural persons
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UNCTAD
AUDIOVISUAL SERVICES
Three proposals have been presented so far by
• Brazil,
• the US and
• Switzerland
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UNCTAD
PROPOSAL FROM BRAZIL
• Promote the progressive liberalization of this
sectors
while
ensuring
governments’
autonomy to preserve and promote cultural
identity and cultural diversity
• Consideration of subsidization schemes and
trade defense mechanisms
• Take into account Art. IV.1 of the GATS
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UNCTAD
PROPOSAL FROM THE US
• Summary list: new classification would treat
the audiovisual and related service activities as
a cluster
• Technical neutrality: where no specific
references to the type of technology used in
providing basic telecom services, specific
commitments would automatically cover all
means of technology
• E-commerce to be considered in the
negotiations
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UNCTAD
•
•
•
•
PROPOSAL FROM
SWITZERLAND
Issue of competition policy
Role of public services in audiovisual
Preserve cultural diversity
Safeguard and subsidies issues
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UNCTAD
IMPLICATIONS FOR
DEVELOPING COUNTRIES IN
THIS SECTOR
• Determine sectors of competitivity
• Flexibility to use subventions to promote their
social and cultural life, while restricting the
subsidies in developed countries
• Emergency Safeguards Measures
• Identify barriers to their exports
• Identify adequate measures
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