# **_Source of data and methodology_**

An ongoing research project by the World Bank is compiling data on _actual or applied_ trade policies in services. To date surveys have been conducted in 32 developing and transition countries and comparable information obtained for 24 OECD countries.

The following sectors were included in the survey: financial services (includes retail banking, life and automobile insurance, and reinsurance), telecommunications (includes fixed and mobile), retail distribution, transportation (air passenger, road and railway freight, maritime international shipping and maritime auxiliary services), and selected professional services.<sup>2</sup> In each sector, the survey covers the most relevant modes of supplying that service: cross border trade in services (mode 1 in WTO parlance) in financial, transportation and professional services; commercial presence or FDI (mode 3) in each services sector; and the presence of service supplying individuals (mode 4) in professional services.

In each of the 32 developing and transition countries, the surveys were completed by local law firms which were familiar with the policy regime in the sectors. For the 24 OECD countries, the comparable policy information was collected from various publicly available sources, including their GATS commitments and the most recent offers, and other sector specific databases such as Economic Intelligence Unit Country Finance reports, IMF Annual Report on Exchange Rate and Exchange Arrangements, and the AXCO insurance database. The survey information and the OECD policy summaries are confirmed by the government trade officials during 2008. Government officials from sixty per cent of the countries covered responded and confirmed the accuracy of the policy information. Some revisions were made to the policy summary after the follow up with the governments.<sup>3</sup> The UR commitments and the Doha Offers came from the WTO.

To capture the broad restrictiveness of services trade policies and commitments, a summary of key restrictions was prepared for each sector-mode. Then, each summary was mapped on a 5- point scale ranging from 0 (for no restrictions) to 1 (highly restricted)<sup>4</sup> , with three intermediate levels of restrictiveness (0.25. 0.50 and 0.75) (Annex Table 2).<sup>5</sup> Furthermore, sector results are aggregated across modes of supply using weights that reflect judgments of the relative importance of the different modes for a sector (Annex Table 3). For example, mode 4 (temporary movement of suppliers) is important for professional services, but not for telecommunications, where mode 3 is the dominant mode of contesting a market. Sector restrictiveness indices are

> 2 The survey also covered air transport services, but we do not describe the findings in this paper because air traffic rights were excluded from the scope of the GATS.  Maritime auxiliary services cover cargo handling, storage and warehousing, customs clearance, container station and depot services, agency, and freight forwarding services. The professional services consist of accounting, auditing, and legal advisory services for domestic and international law.

> 3 For the list countries that sent the policy confirmation, see annex table 4.

> 4 In the quantification of GATS commitments and offers, if a country did not schedule a sector or if it entered “Unbound” for a particular mode, the maximum score of 1 is assigned to the relevant modes.

> 5 The list of restrictions included in the summary is not exhaustive, but selected to facilitate a comparison with restrictions scheduled during the Uruguay Round and the Doha Agenda.  For example, an excessively high fee for establishing an international gateway in telecommunications emerges from our survey as a significant impediment to entry, but is not treated as a restriction because this measure is not scheduled under the GATS.

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