The development of well-functioning and efficient services sectors is critical to achieving structural transformation and sustainable and inclusive growth in Least Developed Countries (LDCs) and Low Income Countries (LICs). Services have a catalytic role on sustainable social and economic development and serve as a means of addressing poverty, upgrading welfare, transforming economies, and improving universal availability and access to basic amenities.
Globally, services account for two-thirds of world employment, 60 percent of foreign direct investment flows and nearly half of world trade, measured on a value-added basis. There is a strong link between a higher concentration of economic activity in the services sector and higher rates of economic growth. The implementation of the LDC Services Waiver now underway in the WTO provides an additional incentive for further developing covered sectors in these countries.
With the huge untapped potential to develop services trade in LDCs and LICs to support and reinforce efforts to transform economies and generate inclusive and sustained growth; increased awareness, better understanding and enhanced capacity among relevant policy actors and other stakeholders would go a long way towards creating and sustaining the conditions under which this potential can be realized.
Building on a recent regional dialogue in Nairobi, this session will examine how enhancements in supply-side capacity in services sectors can contribute to sustained and inclusive growth in Least Developed Countries (LDCs) and Low Income Countries (LICs). Enhancing supply-side capacity by addressing supply-side constraints, including regulatory restrictions, in LDCs should contribute not only to enhance efficiency in the domestic economies but also to more effectively tap into global services markets, diversify the export basket, and enhance development objectives. Focus on improvements in service sector competitiveness dovetails with this year’s theme of “Trade Works” as the session, at its most fundamental level, examines the relationship between domestic supply-side capacity and the ability of LDCs and LICs to reap the rewards associated with participation in the global trading system.
The objective of the session is to dig deeper into understanding the potential of specific service sectors, such as finance, ICT, and tourism, to drive sustainable development in a meaningful way. The session will have a practical focus and will not only examine those service sectors which offer the highest likelihood of positive impact, but will also address the particular supply-side constraints which impede service sector development and the challenges associated with building supply-side capacity in specific service sectors.