WTO trade deal must include services - lobbyists

GENEVA (Reuters) - A new world trade deal may not be accepted if it does not do justice to services, which make up the bulk of economic output, lobby groups said on Thursday.

The key to this is greater involvement in services issues by ministers and political leaders, the lobbyists from a range of countries told reporters after meeting World Trade Organisation (WTO) director-general Pascal Lamy and WTO ambassadors.

Negotiations in the Doha round of world trade talks have focused in recent weeks on improving market access for farm and manufactured goods, the latter known in the WTO as NAMA.

These have been based on draft texts issued in July by the chairmen of the agriculture and industry negotiating groups.

Trade diplomats say that if progress is made, these texts could be issued in revised form next month allowing ministers to agree the outlines of a comprehensive trade deal in November.

"The Doha round needs to deliver results on services that are on a par with those that are expected for agriculture and NAMA," said Sergio Marchi, who chairs the Global Services Coalition grouping a dozen service industry associations.

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Services, ranging from banking and telecoms to express delivery and construction and mining services, account for 70 percent or more of gross domestic product (GDP) in most developed countries. In many developing countries it is 50-60 percent of GDP and growing.

But services make up only 19 percent of world trade, against 74 percent for merchandise goods. And they do not have the political sensitivity that keeps agriculture in the foreground.

The potential gains for the world from services liberalisation are huge. One study cited by the U.S. Coalition of Service Industries says service liberalisation could benefit developing countries by $6 trillion in 2005-2015, four times more than goods' liberalisation.

The main issue in the services negotiations is whether countries agree simply to lock in existing market openings, or go for a more ambitious liberalisation.

Consolidating the existing state of play as the new minimum might be acceptable to the EU, but Bob Vastine, president of the Coalition of Service Industries, said it would be impossible to sell a deal to the U.S. Congress unless it includes new openings.

Marchi said negotiators in Geneva need a revised updated draft to work on similar to that in industry and agriculture.

"There seems to be a general agreement that that text is needed," said Marchi, also chairman of the Canadian Services Coalition.

A decision to produce such a text could come as early as Friday, when the next regular session of Doha round negotiations on services takes place to brief the WTO's 151 members on the progress of informal talks in small groups on different sectors.

The Global Services Coalition groups service industry associations from Australia, Brazil, Canada, Barbados, the European Union, Hong Kong, India, Japan, Malaysia, Taiwan and the United States.