Ministry
of Commerce, together with South Asia Watch on Trade, Economics and Environment
(SAWTEE), organized a half-day workshop on “WTO Services Waiver: Exploring
opportunities and challenges for Nepal” on 9 July 2017. The objective of the
workshop was to discuss the status of services sector in the Nepalese economy
and its role in export promotion. The programme also discussed the multilateral
rules governing the services sector, including Services Waiver, and explored
ways to benefit from the waiver provided to the least-developed countries (LDCs)
by the developed and developing World Trade Organization (WTO) members.
WTO members adopted a decision to provide preferential
treatment for services and services suppliers of the LDC members at the Bali
Ministerial Conference, and is generally known as the ‘Services Waiver’. The
preferences are subject to terms, limitations and conditions specified in the
schedule of services commitments of the member countries. In response to the
collective request of LDCs, the members of the WTO have submitted their
services waiver commitment to the WTO Council for Trade in Services. So far 23
WTO members have submitted their Waiver commitments. The LDCs have 15 years
from the day the Waiver is notified to the WTO to benefit from the provision.
Dr. Posh Raj Pandey, Executive Chairman of SAWTEE,
during his presentation presented the status and trend of services sector in the
Nepalese economy. He also explained the General Agreement on Trade in Services (GATS)
under the WTO and the Services Waiver provision accorded to the LDCs. The
presentation focused on various Waivers provided by the developed and
developing WTO members within the 12 sectors and four different modes of
services trade defined under the WTO regime. He highlighted the market access
and national treatment provisions in the Waiver notifications of countries that
may be possible destination of services export of Nepal, such as the European
Union, China, United States, India, and Australia. He explained the Waivers provided
in sectors such as Communication services, Construction services, Education
services, Financial services and Tourism and travel related services.
Speaking during the programme, Mr. Naindra Prasad
Upadhyaya, Secretary at the Ministry of Commerce opined that there is a need
for wider consultation with the private sector to understand the nature and
direction of the services sector in Nepal to be better prepared to undertake
negotiations in the bilateral, regional and multilateral levels.
Mr. Binod Dhakal, President, Federation of Computer
Association of Nepal and Chair, ICT Development Committee, Federation of
Nepalese Chambers of Commerce and Industry (FNCCI), commenting on the
presentation, highlighted the difficulties faced by the ICT sector in Nepal. There
are difficulties related to the use of forex, visa restrictions while visiting
their counterparts in the developed countries, ambiguous national laws, among
others, as factors hindering Nepalese ICT sector. Unreliable electricity supply
and weak internet connection has further weakened Nepal’s capacity, he said. He
was of the opinion that there should be a single Ministry to handle the
ICT-related matters in Nepal. ICT sector is currently governed by the Ministry
of Information and Communication and Ministry of Science and Technology. He
also pointed out that there are numerous Business Process Outsourcing (BPO)
companies operating from Nepal but they are not in the formal regulatory ambit
to avoid regulatory hassles.
Mr. Toya Narayan Gyawali, Joint Secretary, Ministry of
Commerce, Government of Nepal informed the floor that the government puts ICT
on the forefront while designing its development strategy, and he also opined
that the LDC Services Waiver can also be instrumental in achieving the
Sustainable Development Goals in the long term. He also pointed out the lack of
reliable data pertaining to service sector as one of the impediments while
designing policies.
Mr. Rabi Shankar Sainju, Joint Secretary, Ministry of
Commerce, Government of Nepal delivered the welcome remarks, and highlighted
the objectives of the workshop. He requested the participants to put forth
their concerns so that the government will be aware of them to take necessary
steps in resolving them.
Steered by rapid growth in
telecommunications, tourism and financial sectors, services sector is now the
largest contributor to the GDP. The share of services in the GDP increased from
26 per cent in 1980 to 52 per cent in 2014/15 whereas agriculture and industry
contributed 33 per cent and 15 per cent respectively. In 2015, services exports
contributed to 63 per cent of the total exports and reached US$1.4 billion by
value. The services exports are largely driven by travel and telecommunication
(80 per cent in 2014), including an informal and rudimentary IT sector. Nepal’s
export of labour services (Mode 4) in the form of labour migrants is specifically
important as the workers’ remittances in 2014/15 contributed to 29 per cent of
the GDP.
The workshop brought together government
officials, practitioners, private sector representatives, media personnel,
academics and various other stakeholders to share their knowledge and
experience in services trade. A total of 40 participants attended the
programme.
Programme Agenda
Background Note
Presentation:
Posh
Raj Pandey, Chairman, South Asia Watch on Trade Economics
and Environment (SAWTEE)
WTO Services
Waiver: Exploring opportunities and challenges for Nepal
Media Coverage