**Table 4**

**Operationalizing an Investment and Mode 3 Trade in Services Facilitation Agenda**

|**Trade in services**<br>**cost component**|**Market Failure/**<br>**Problem to be**<br>**addressed**|**Trade facilitation**<br>**agenda dimension**|**Diagnostic**<br>**indicator**|**Impact Indicators****|
|---|---|---|---|---|
|Information costs|Information<br>asymmetry|Transparency|WBG<br>governance<br>indicators|Trade/investment<br>generated|
|Transaction costs|Red tape|Process streamlining|WBG/IAB<br>indicators|Private time/cost<br>savings|
|Quality of<br>regulatory<br>governance|Uncertainty and un-<br>predictability from<br>regulatory risk|Consistency and<br>predictability in the<br>application of<br>regulatory<br>frameworks|Political risk<br>indicators|Investment<br>retained/expanded|
|Regulatory<br>Heterogeneity|Economies of scale|Regulatory<br>convergence|RH Index|Trade/investment<br>generated|
|Discriminatory<br>PolicyMeasures|Distortions to<br>competition|Standstill|STRI|Trade/investment<br>generated|

** Methodologies to operationalize these impact indicators have already been developed by the WGB.

Source: Echandi and Sauve (2019) This approach has important policy implications. First, it suggests that to if facilitate trade is to reduce the costs of undertaking cross border transactions, then the conceptualization of trade facilitation in services and investment is falling short of covering the most relevant cost factors. Second, the segmented nature of the facilitation discussions on services and investment contributes to likely rulemaking overlaps. Third, the discussion on services trade and investment facilitation needs to be framed in such a way as to enable policy makers to address issues that are common to both sets of talks in an integrated manner and to translate evidence-based policy making into actionable deliverables the results of which can be objectively measured under a rigorous monitoring and evaluation framework. Measuring impacts is key not only to monitor progress in the effectiveness of any trade facilitation agenda, but also to show and educate private sector and civil society actors on the importance of trade and investment for development. Table 4 presents a preliminary sketch which could be used to organize a more comprehensive agenda on investment facilitation in services linking trade cost components with their respective market failure/problems, areas for trade facilitation policy intervention, and diagnostic and impact indicators.

# **c- Temporary Movement of Natural Persons**

Singh (2019) discusses the concept of TFiS applied to the temporary movement of natural persons (MNP or Mode 4).<sup>3</sup> In this case, policies are a major determinant of the costs incurred by service suppliers to contest foreign markets (see table 5). But irrespective of a government’s policy stance and the concomitant regulatory measures governing market access for foreign suppliers, certain procedural and administrative requirements must always be satisfied. As is true for procedures that apply to goods crossing borders, there are costs for service suppliers in complying with regulatory policies, that go beyond fees and charges for documents or certification/conformity assessment and the time allocated to doing so. Moreover, these costs tend to increase with inadequate information

> 3 Delivery of services frequently requires cross-border movement of services suppliers, both temporary and longer-term in the form of contractual service suppliers (CSSs), independent service suppliers (ISSs) and intra-corporate transferees (ICTs).

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