This session addressed the services implications for third countries that are not participants in the negotiation of mega-regional trade agreements (TPP, TTIP and RCEP) or in the TiSA, in terms of the potential impact of these agreements on market access as well as their governance challenges. It considered the possible options open to non-member developing countries as they contemplate how to address these agreements.
The risk of marginalization for most of the countries in the world economy, especially the lesser developed, is very real given the coming age of mega-regional trade agreements. Of the 196 countries in the world, 52 of them are participants in one of the three potential mega-regional trade agreements (with seven countries overlapping in two). This leaves 144 countries or nearly three-fourths of those in the world economy outside of these agreements. However, the lion’s share of world output, trade and investment lies with the countries negotiating these mega-regionals. In the case of the recently concluded Trans-Pacific Partnership (TPP) agreement, 12 countries account for 40% of the world’s GDP and 33% of world trade. For TTIP, the EU and the US account for almost half world’s GDP, 30% of global merchandise trade and 40% of global services trade. As for TiSA, 50 countries account for nearly 70% of world trade in services. Thus, the potential impact of these new agreements may be significant and particularly so in the services area, given its pervasiveness throughout these modern trade agreements (accounting for nearly one-third of the chapters in the TPP).
The following two questions have been debated:
What will be the possible impact on non-member countries of these agreements?
What strategies and policy options are available to non-member countries in responding to these mega-regional agreements?