Sebastian Saez

This Toolkit provides a framework, guidelines, and practical tools for conducting an analysis and diagnostics of trade competitiveness of the services sector. The methods of analysis are fully customised to address the features of the services sector. Successfully tested on country-specific assessments, the methods proposed in this toolkit aim to evaluate the competitiveness of the services sector and identify constraints to improved competitiveness and appropriate policy responses. The output of a services trade competitiveness assessment can be used to assess the overall performance of a country's services sector as well as for individual sub-sectors. In addition to the desk (quantitative) analysis, the success of a services trade competitiveness diagnostics (STCD) will depend on qualitative assessments and input from a wide variety of stakeholders in the country, including government officials and the private sector. A STCD should therefore be conducted in four key steps: preparation of a preliminary trade outcomes assessment based on available hard data; initial desk research and preparation for fieldwork; in-country field research; and finally, analysis and preparation of the final STCD report and policy recommendations. The toolkit consists of the following main sections:Overview and guidelines for conducting a STCD. This section is illustrative and appropriate to all audiences, including policy makers and managers overseeing a STCD exercise. Implementation toolkit, this provides detailed practical information and tools for carrying out the diagnostics exercise. The implementation toolkit is further divided in three modules:Module 1: Services Trade Outcomes Analysis (indicators and tools)Module 2: Services Trade Potential Analysis (indicators and tools)Module 3: Policy Options for Services Trade CompetitivenessIllustration of Reference DatabasesDatabases of indicators that can help assess the importance of services and services trade.

The services sector—ranging from telecommunications and banking to business processing and outsourcing—is increasingly recognised as part and parcel of any trade strategy, both as a source of export diversification in its own right as well as a key component of a country’s competitiveness. Unlike trade in goods, which is governed by border measures that regulate the entry of foreign merchandise, international trade in services is subject to a wide range of domestic laws and regulations that govern access and operations by both domestic and foreign suppliers. While such regulations are essential where market failures or externalities exist and to ensure non-economic objectives, it is often difficult to differentiate between legitimate policy objectives and protectionist measures that introduce distortions and inefficiency in the market. An unnecessarily restrictive regulatory framework limits the potential of the services sector to develop, and undermines the export opportunities and competitiveness of domestic businesses. This toolkit offers a practical methodology to assess the impact of services regulations: the Regulatory Assessment on Services Trade and Investment (RASTI). The RASTI helps to evaluate whether a country’s regulatory framework is promoting the development of an efficient domestic services market, and offers guidance on how to ensure that services regulation correctly addresses market failures and achieves public policy goals. The authors propose three steps towards a trade-related regulatory assessment: - mapping laws and regulations that affect trade and investment in services, and assessing the regulatory process and institutional arrangements; - wherever possible, providing a quantitative assessment of the impact of regulations on performance and market structure, including prices, quality and access; and - identifying alternative regulations and institutional set-ups that promote an enabling regulatory environment for services trade while achieving the desired policy goals. Performing a regulatory assessment can serve multiple purposes depending on the circumstances and the needs of the evaluators, including bridging information gaps; supporting regulatory reform; supporting trade negotiations; assessing regulatory performance; and promoting better regulatory practices. The Regulatory Assessment Toolkit will be of particular interest to policy makers and government officials from regulatory bodies, experts at development banks and donor agencies, and academics and researchers in the field of economic regulation.

This toolkit provides a novel approach and a set of tools that allow policymakers and analysts to identify non-tariff measures (NTMs), assess their trade restrictiveness and impact on prices and welfare, and to strengthen the institutional coordination mechanism, transparency, and regulatory governance on NTMs. It also aims at encouraging economies to increasingly address the NTM agenda from a domestic competitiveness and/or poverty perspective rather than from a mercantilist standpoint of concessions to trading partners. NTMs are policy measures, other than ordinary customs tariffs, that can potentially have an economic effect on international trade in goods, changing quantities traded, or prices or both. While most NTMs are already subject to WTO disciplines, the main challenge is to allow governments to address public policy concerns without unnecessarily hurting trade competitiveness and while preventing disguised protectionism. This toolkit is predicated on the idea that the complexity and diversity of NTMs should be recognized. Problems should be identified at the country level through consultations with the private sector, and technical solutions should be sought through careful analysis and private/public dialogue. The underlying philosophy is similar to what is known as “Regulatory Impact Assessment” (RIA), but applied to the review of existing measures (no ex ante analysis), in response to specific demands from countries struggling with legacies of complicated and penalizing regulations. Dealing with existing measures has the advantage of responding to an immediate need and focusing on measures whose effects are known. The toolkit is organized as follows. Chapter 1 discusses the newly revamped NTM classification and pervasiveness of NTM. Chapter 2 elaborates on the analytics of an NTM review, walking the reader step by step through the key questions. Chapter 3 focuses on the institutional set up and key principles to successfully pursue the streamlining of regulations. Finally, chapters 4 and 5 provide some practical cases of streamlining both at the country and regional levels, and for product specific examples.