GATS

Acronym for General Agreement on Trade in Services, often confused with the GATT. This is an agreement that falls within the neo-liberal structural adjustment policies of the WTO.

This agreement was supposed to be expanded in Seattle during the WTO 3rd ministerial conference, but was somehow delayed. The idea of the expansion was to attempt to privatize major segments of the public sector. 74% of all jobs in the U.S. are in the service sector. Health Care, education, banking, insurance and data management would all die off in the name of privitization.

Lower standards for public secotr workers and reduced power for local governments to set fair hours and working conditions are all possible.

Since the WTO was put in place, many service sectors have been privitized.

GATS has two main objectives: (a) to define a set of general concepts, principles and rules that allows 'trade' in services to be measured, and (b) make WTO members declare commitments to liberalising market access to foreign service delivery providers.

There are four modes of supply which defines how a service is traded:

Mode 1: cross-border supply not requiring the movement of commodities or people (eg: data warehousing)
Mode 2: movement of the consumer to the country of supply (eg: tourism)
Mode 3: services delivered by foreigners in a foreign country who have established a commercial presence (eg: accounting)
Mode 4: services requiring the temporary movement of natural persons (eg: circus troopes).

GATS does not apply to government services, air or maritime transport. Beyond that, WTO members are supposed to progressively reduce limitations on market access for various sectors in a non-discriminatory fashion. Developing countries are given some latitude in their schedules.

Sectors that involve activities governments normally are responsible for like health and education are not as likely to have been committed to liberalisation as other areas, whereas tourism has been liberalised in over 120 countries.

Mode 2 services have attracted the greatest number of full commitments. There may be more partial commitments for Mode 3 services than for Mode 1, but there are less full commitments, since governments would like a foreign presence to also transfer technology and generate employment. Also, probably because governments don't like foreigners rocking up to their shores with a mediocum of capital, Mode 4 services have only been fully accepted by a few transitional economies (although it has the largest number of partial commitments).