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Services negotiations under the Tripartite Agreement: Issues to consider

Working Papers

Services negotiations under the Tripartite Agreement: Issues to consider

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The Tripartite Free Trade Area (FTA) is envisaged not only to cover trade in goods, but also trade in services. It is, however, expected that the services negotiations at the tripartite level will begin only once the regional processes to liberalise trade in services have been completed, and most likely after the issues relating to trade in goods have been addressed.

Due to the varying pace of progress made by member states of the Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (COMESA) and the East African Community (EAC), it is difficult to provide a comprehensive analysis on the state of services liberalisation in the tripartite region. This paper therefore begins with an analysis of the services liberalisation commitments made by the tripartite member states at the multilateral level since it is the only experience some of these countries have had with regard to services negotiations. This analysis also attempts to set a benchmark for the calculation of ‘substantial sectoral coverage’ which all services agreements will have to comply with.

The progress, or rather lack of progress, in the SADC and COMESA configurations is considered and a more in-depth analysis on the services liberalisation commitments made by the EAC member states is provided. The EAC is the only configuration to have drafted its services schedules, so no comparison can be drawn between outcomes of the regional services negotiations. The paper therefore compares the process and liberalisation commitments of the EAC with that of the Mercosur member states to put the progress of the African countries into context. The more lessons regional member states learn from their individual services liberalisation processes, the better they can design and implement a larger tripartite strategy.

An important aspect that this new situation of supra-regional services negotiations will demand is the need for continuity; the need for the converged tripartite market to build on what has already been achieved in the markets of COMESA, EAC and SADC. The paper examines the services provisions in the draft Tripartite Agreement and looks at the services negotiating guidelines that were originally published in November 2009. It also compares the proposed process under the Tripartite Agreement with the ongoing processes at the regional level and highlights some of the challenges member states may encounter.

The regional negotiations are taken as the starting point for thinking around the larger tripartite integration, and on this basis the paper provides challenging suggestions on the way forward. It presents innovative ideas on the sequencing of the negotiations, the manner and degree of liberalisation, the responsibility of the more developed member states, deeper integration in a services market and the administration of regulatory information. The paper concludes by making brief recommendations on how member states can prepare for services negotiations at the tripartite level.

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Services negotiations under the Tripartite Agreement: Issues to consider - Author(s): Paul Kruger

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