Implications of the Doha Round negotiations in services for Poland

Using a computable general equilibrium model we assess the effects of services trade liberalization in Poland and its major trading partners in the context of the WTO Doha Round negotiations and the ongoing process of trade liberalization within the enlarged European Union. The paper provides a thorough descriptive analysis of the data on trade in services. It gives a complete picture of the sectoral and geographical structure of Poland’s trade in services in 2007. We also provide an analysis of revealed comparative advantage indices based on sectoral data. The review of literature is focused on a discussion of the methodology for assessing the barriers to trade in services. The core of the paper consists of a CGE simulation using the GTAP model. We employ the Hoekman (1995) tariff equivalents as a proxy for the initial level of trade barriers. Our four scenarios include those of complete liberalization, EU-only liberalization and two intermediate scenarios. The most optimistic scenario is expected to bring a 0.9% increase in Polish GDP and welfare improvement of close to 0.8% of GDP value. However, more than half of this gain is attributed to the liberalization within the EU that is bound to happen independently from the Doha process.