Source: http://www.intracen.org/BB-2010-04-16-General-Agreement-on-Trade-in-Service---Part-15/
Timestamp: 2017-05-25 10:48:29
Document Index: 109282461

Matched Legal Cases: ['art 15', 'art 15', 'art 1', 'art 2', 'art 3', 'art 4', 'art 5', 'art 6', 'art 7', 'art 8', 'art 9', 'art 10', 'art 11', 'art 12', 'art 13', 'art 14']

BB 2010-04-16 General Agreement on Trade in Service - Part 15
General Agreement on Trade in ServicePart 15: Service Sector - Tourism Services
Tourism (and Business Travel Services), broadly defined, is regarded as the world's largest industry and one of the fastest-growing, accounting for over one-third of total services trade. Highly labour-intensive, it is a major source of employment generation, especially in remote and rural areas. Tourism demand, both domestic and international, is directly related to income levels, and therefore has prospered as global wealth has increased.Unlike for most goods and services sectors, the liberalisation of trade in tourism services is more often a process of domestic liberalisation, rather than obtaining concessions from trading partners. The industry is very dependent on effective linkages with a wide range of infrastructural services, including transport, financial services, and telecommunications. Promotion of sustainable tourism can have an important impact on poverty alleviation, due to significant employment opportunities for low-skilled labour, as well as to the location of many tourism attractions in rural and remote areas. The World Tourism Organization (WTO/OMT) has emphasized that adequate infrastructure must be in place (and sufficiently maintained) to support any intended tourism activities, both for domestic and international tourism. This includes airport facilities, port facilities, road systems and telecommunications, as well as water supplies, electric power and sewage treatment facilities. Regarding actual tourism facilities, adequate consideration must be given to lodging and food, as well as local transportation. Obviously, trade liberalisation, including GATS mode 3 commitments, could have a significant effect in providing the needed capital, technology and management expertise.Another aspect of trade in tourism is sustainable development. According to the World Tourism Organization (WTO/OMT), sustainable tourism is generally defined as meeting the needs of present tourists and host regions, while protecting and enhancing opportunities for the future. Sustainable development can be defined as a sustained improvement in the fulfilment of the needs of a population without exerting a negative impact on the environment, and ecotourism defined as responsible travel to natural areas which conserves the environment and improves the welfare of local people. Although mass tourism has sometimes been blamed for undermining the socio-economic basis of traditional local life, positive effects of well-managed tourism can actually include the revival of local cultures, including their arts and handicrafts by offering an alternative to urban migration.Economic ImportanceAccording to the WTO/OMT, international tourism is one of the most dynamic sectors of the global economy. The growth over the past fifty years has averaged at a rate of 6.5% with many years exceeding this level. The world figures (see reference section for a list of documents from the World Tourism Organization) from 2006 show that tourism demand is dependent on national, regional and global economic growth. Regardless, the further growth of this industry consistently and significantly outpaces economic growth (measured in Gross Domestic Product, or GDP). The WTO/OMT notes that in years when world economic growth exceeds 4 per cent, the growth of tourism volume tends to be higher. At 3.5 per cent tourism grew on average 1-3 times faster than GDP. When GDP growth falls below 2 per cent, tourism growth tends to be even lower. Services coveredDefinition and Classification
It is generally recognised that is it difficult to define and/or measure tourism with any precision. In 1993 the International Forum on Tourism Statistics was established and resulted in the development of Tourism Satellite Accounts (TSA), which provides comparable international accounts in addition to an improved analytical framework (go to ‘References’ for the internet link to more TSA information). The satellite accounts measure tourism-related activity by determining what percentage of each industry is accounted for by tourism. The TSA methodology is being used, or under development, in a significant number of OECD countries, as well as in an increasing number of developing countries.As defined under the WTO's Services Sectoral Classification List, commonly referred to as W/120 (MTN.GNS/W/120), the category "Tourism and Travel Related Services" is distinctly limited in scope. It comprises only hotels and restaurants, travel agencies and tour operators, and tourist guide services (together with an "Other" sub-category). The first three of these sub-categories have an associated listing under the United Nations Provisional Central Product Classification (referred to as CPC or UNCPC) .Presumably to avoid sectoral fragmentations, numerous other tourism-related services -- such as computer reservation systems; cruise ships and many other transport services; hotel construction; car rentals; certain distribution, business, and financial services; as well as most recreational, cultural and sporting services -- have been placed within their respective W/120 sectoral categories.In the context of the services negotiations that began in 2000, several developing countries circulated a paper (S/CSS/W/19) on the "Cluster of Tourism Industries," based on the TSA. This paper is very helpful for understanding the scope of services related to, or that are part of the tourism sector, and includes a reference list of these services indicating their W/120 classifications. This listing serves as a useful “checklist” for identifying and addressing tourism-related services.Modes of supplyThe supply of tourism services is characterized primarily by the consumer coming or going to the supplier, i.e. Mode 2. In this case it is the tourist who travels from their home country to take a vacation in a foreign country. In fact this is one of the most crucial aspects of international trade in tourism services. Mode 2 exports are provided by all sizes of business interests in the foreign country. This ranges from individuals selling handiwork and local crafts to multinational hotels selling accommodation and food, in addition to all the small and medium size enterprises offering a wide array of services to foreigners from abroad.Mode 1 trade in tourism services, especially travel agency and tour operator services, is becoming increasingly important as use of the Internet for travel bookings expands. It offers opportunities for developing country suppliers to "cut out the middleman", thereby reducing "leakages" and retaining a great share of tourism expenditures domestically.Mode 3 is also very important for tourism through the establishment of businesses that build facilities for food and lodging as well as transportation. Liberalisation commitments in this area could also have a significant effect through providing needed technology and capital investment. Mode 4 trade is characterized by the movement of both skilled and semi-skilled hotel and other tourism-industry workers, typically on a seasonal basis, and the remittances received can be a significant source of foreign exchange for developing countries. Regulatory issuesIt has been noted by various agencies that many of the regulations affecting tourism, such as equity limitations on foreign direct investment (FDI), tend to be by-products of general economic, political and social concerns applying to a number of sectors. In some cases, restrictions might be imposed by both the services importer and exporter. Such measures notably include immigration and security controls together with documentation requirements, as well as any restrictions on currency movements that might be applied to individual tourists or tourism businesses. Specific regulations applying to the tourism sector might have objectives such as consumer protection, ensuring financial responsibility, or development of the local economy and the domestic tourist industry. A lack of regulatory transparency, or the denial of national treatment, might also act as general barriers to international trade in tourism services. UNCTAD has noted strategies for strengthening the competitiveness of the tourism sector in developing countries, which include: modernization of the regulatory framework; strengthening the institutional capacity (i.e. coordination and planning mechanisms); application of international standards; and the strengthening of competition rules.Common limitationsPrimarily, common limitations found in Tourism services are: - Restrictions on the movement of natural persons supplying services in tourism and recognition of their qualifications. This would be found as Mode 4 limitations in the National - Treatment and Market Access columns; - Economic needs tests affecting specific sub-sectors and modes of supply; - Mode 1 requirements for commercial establishment or presence (e.g. for travel agencies and tour operators); and - Nationality or residency requirements.Developing countries may also face significant costs and technical barriers to Global Distribution Systems (GDS) access. Oftentimes small airlines and tour operators find the booking fees of individual GDS prohibitively high, and the "back office systems" in developing countries are often insufficiently developed. GDS could be developed on a national basis, and grouping into associations could provide the necessary economies of scale. Also, standardization of electronic systems and interfaces could reduce costs.
- Part 1: Introduction to the General Agreement on Trade in Services - GATS- Part 2: Defining Trade in Services-Part 3: MFN Treatment, Transparency and Domestic Regulations- Part 4: General Obligations - Mutual Recognition, Competition Issues and Progressive Liberalisation- Part 5: GATS Commitments-Part 6: MFN Exemptions- Part 7: General GATS Exercice- Part 8: Service Sector - Professional Services- Part 9: Service Sector - Business Process Outsourcing (BPO)- Part 10: Service Sector - Computer Services- Part 11: Service Sector - Postal and Courier Services- Part 12: Service Sector - Health related and Social Services- Part 13: Service Sector - Educational Services- Part 14: Service Sector - Tourism Services Related news