Liberalisation of Trade in Services in South Africa: The Multilateral Dimension

by STEUART, I., 2005
Research Report, Employment Growth & Development Initiative, Human Sciences Research Council

The services sector is an increasingly important dimension of South Africa’s economic development, in terms of both its contribution to growth and its export potential. While exposing the services sector to international competition has the potential to unleash significant gains, deep and justified concerns regarding unemployment, poverty alleviation and universal access to basic services have resulted in South Africa adopting a cautious approach to the progressive liberalisation of key services. The gains from liberalisation do not come automatically, and a coherent and coordinated approach to liberalising services in South Africa is required. This paper reviews progress on the multilateral front in the liberalisation of services. It also outlines a suggested approach to developing a strategy for services liberalisation. A number of issues are highlighted on which the balance of risks and opportunities of liberalising services in South Africa is likely to turn. While the focus is on the process of services liberalisation within the framework of the World Trade Organization (WTO), multilateral liberalisation is not the only method of liberalising services. The paper summarises progress on the General Agreement on Trade in Services (GATS) and reviews South Africa’s current negotiating position. It also considers the state of the trade negotiating apparatus, including NEDLAC, Parliament, organised business, and government. It then identifies the essential ingredients of a negotiating strategy for services liberalisation, and reviews the role of specific sectors in the multilateral negotiating process.