Pre-Empting Protectionism in Services: The GATS and Outsourcing

Cross-border trade in services is growing rapidly, with both industrial and developing countries among the most dynamic exporters. Despite the substantial global benefits from such trade, the adjustment pressures created in importing countries could provoke a protectionist backlash-some signs of which are already visible in procurement and regulatory restrictions. The current negotiations under the Doha Development Agenda offer an opportunity to lock in current openness and preempt protectionism. This paper describes how a bold initiative under the General Agreement on Trade in Services can help secure openness.