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MANAGING THE CHALLENGES OF WTO PARTICIPATION: CASE STUDY 2

Argentina and GATS: A Study on the Domestic Determinants of GATS Commitments

Roberto Bouzas and Hernán Soltz*

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 Disclaimer:
Opinions expressed in the case studies and any errors or omissions therein are the responsibility of their authors and not of the editors of this volume or of the institutions with which they are affiliated. The authors of the case studies wish to disassociate the institutions with which they are associated from opinions expressed in the case studies and from any errors or omission therein.

Case Studies main page
Introduction

  

ON THIS PAGE: 
I. Determinants of trade policy formation
II. Argentina GATS schedules
III. The making of Argentina’s GATS offer
Stage 1: learning what services negotiations were about
Stage 2: accounting for Argentina’s GATS offer
IV. Conclusion
Bibliography
  


The commitments undertaken by Argentina in the General Agreement on Trade in Services (GATS) appear generous when compared with those of other Latin American countries. Based on this finding this case study tries to identify the main factors that shaped Argentina’s services offer under GATS. Although the complexity, extension and coverage of GATS lists makes it very unlikely that one single factor can account for the content of a national offer, our research suggests that the government’s desire to ‘lock in’ domestic policy reforms at a time of profound economic change was a major factor shaping the offer’s content. We found the case study interesting because it underlines the domestic roots of international trade policy-making and illustrates the way in which the international trade regime can be used instrumentally by national authorities willing to consolidate their policy preferences.

The case study is based on a comparative examination of Argentina’s GATS schedules and open interviews with many of those who participated in the policy-making process.(1) The report is organized into four sections. Section briefly summarizes the factors that can shape trade policy formation. Section makes a comparative assessment of the coverage and depth of the Argentine list of offers. Section reports our main qualitative findings about the major factors that shaped its content. Section draws some conclusions from the case study.

   
   

I. Determinants of trade policy formation    back to top

In their study of the determinants of financial services commitments, Harms, Mattoo and Schuknecht (2003) refer to the vast body of theoretical and empirical work arguing that ‘trade policy formation is determined by self-interested politicians granting protection or liberalization to special interests’. According to this view, one key factor behind trade policy formation would be the relative influence of alternative interest groups. This hypothesis may be useful to understand trade policy-making in normal times, but it may shed less light during periods of stress and deep policy reform.

Apart from the role of domestic interest groups, multilateral trade negotiations can also be regarded as a strategic game in which governments look for reciprocal concessions. Thus, the level of concessions made by one country at one point in time may be upheld with the expectation of obtaining larger gains in future bargains. In line with this view, Harms, Mattoo and Schuknecht (2003) maintain that ‘the incentive to trade off current gains from unilateral liberalization against even larger gains from reciprocal opening in the future would seem to be most important for countries that faced high protection in their areas of export interest and possessed, alone or as a group, sufficient negotiating leverage to extract liberalization commitments from their trading partners’ (emphasis in original). Argentina fits in this category, since it was both an exporter of temperate agricultural products and an active member of the Cairns group.(2)

At first sight, the Argentine case does not seem to fit well with any of these explanations. The political economy behind services liberalization is unclear, since trade unions in the reformed sectors were probably more powerful than the consumers potentially benefiting from higher quality and — presumably — lower priced services. Similarly, there may have existed strong bargaining considerations for upholding concessions in order to extract more reciprocal benefits in the future. Where does Argentina fit? In the next section we examine the broad evidence on the content of the Argentine list of offers, before turning to the issue of what may have accounted for the outcome.

    
    

II. Argentina GATS schedules    back to top

This section reviews Argentina’s GATS schedules and compares them with those of its neighbours. Berlinski and Romero (2001) were the first to point out that Argentina’s GATS commitments had a relatively high sectoral coverage and level of openness, higher even than Chile (generally taken as the Latin American paradigm for an open and deregulated economy).(3) Table 1 shows that Argentina made binding market access commitments for 232 items (out of a total of 620(4)), 144 of them bound with no restriction (‘none’).(5) This means that Argentina undertook market access commitments for 37.4% of total negotiable items, nearly a third of which had no restrictions. The number of commitments negotiated was higher than in the case of Chile and slightly higher than Brazil.(6) The contrast between the Argentine offer and those of its neighbours deepens when the comparison is made using the ratio of no-restriction commitments to the total number of negotiated items. In effect, while Argentina bound 62.1% of its commitments under the ‘none’ category, the Brazilian and Chilean ratios were only 22.3% and 31.0%, respectively. Cross-country differences in national treatment are slightly less marked than in market access, but they maintain the same pattern (see Table 2).(7)

  

Table 1
GATS: Commitments on Market Access

 

Argentina

Brazil

Chile

Latin America average

OECD average

   GATS
94 
GATS
94 + prot.
 GATS
94 
GATS
94 + prot.
 GATS
94 
GATS
94 + prot.
 GATS
94 
GATS
94 + prot.
 GATS
94 
GATS
94 + prot.

Number of negotiated commitments

208 232 156 224 140 168 119 na 330.4 na

Number of no-restriction commitments

136 144 19 50 36 52 49.1 na 188.9 na

Number of negotiated commitments as percentage of total GATS list*

33.5 37.4 25.2 36.1 22.6 27.1 19.2 na 57.2 na

Number of no-restriction commitments as percentage of number of negotiated commitments

65.4 62.1 12.2 22.3 25.7 31.0 41.3 na 57.2 na

* Total GATS list = 620
Source: Based on Berlinski y Romero (2001)

  

Table 2
GATS: Commitments on National Treatment

 

Argentina

Brazil

Chile

LA Average

OECD Average

 

GATS
94 

GATS
94 + prot.

GATS
94 

GATS
94 + prot.

GATS
94 

GATS
94 + prot.

GATS
94 

GATS
94 + prot.

GATS
94 

GATS
94 + prot.

Number of negotiated commitments

208

232

156

224

140

168

nd

Nd

nd

nd

Number of no restriction commitments

136

154

27

77

48

73

nd

Nd

nd

nd

Number of negotiated commitments/ Total GATS list*

33.5

37.4

25.2

36.1

22.6

27.1

nd

Nd

nd

nd

Number of no restriction commitments / Number of negotiated commitments 

65.4

66.4

17.3

34.4

34.3

43.5

nd

Nd

nd

nd

* Total GATS list = 620
Source: Based on Berlinski y Romero (2001) 

The cross-country comparison of market access commitments across service sectors displays differences and similarities (see Table 3). First, Argentina, Brazil and Chile show uneven coverage ratio across sectors. None of the countries made commitments in the fields of education, environmental services, social and healthcare services, recreational, cultural and sporting services, and other services. In addition, Chile undertook no commitments in construction and construction-related engineering and distribution services. Consequently, in the case of Chile market access commitments were concentrated in only five sectors (business services, communications, financial services, tourism and transportation).

Second, in four out of five sectors in which Chile undertook market access commitments (business services, communications, financial services and tourism), the coverage ratio was lower than that of Argentina. Only in the case of transportation (where Argentina made no offer) do the commitments made by Chile show a higher — but still very low — coverage ratio. Interestingly enough, Chile’s coverage ratio is lower than that of Brazil in communications, financial services and transportation.

Third, when the sectors in which the three countries made commitments are compared, financial services shows the highest coverage ratio, followed by communications and business services.

As far as the depth of commitments was concerned, in most cases where Argentina undertook market access commitments it did so under the no-restrictions modality (‘none’). The exceptions were communications, financial services and the horizontal restrictions applicable to Mode 4 (see below). In addition, in most sectors where Argentina made market access offers the degree of openness committed was higher than the OECD average (see Table 4).

 
 

III. The making of Argentina’s GATS offer    back to top

Stage 1: learning what services negotiations were about

Argentine trade officials had traditionally focused on trade in goods (particularly temperate agriculture products) and were thus not prepared for undertaking international negotiations in services. This confronted them with the imperative to understand the nature of the issues under negotiation and the implications of alternative modalities and commitments.(8)

 

Table 3
GATS: Commitments on Market Access by Sector (Sub–sectors with Commitments/ Total Number of Sub–sectors)

 

Argentina

Brazil

Chile

Latin America average

OECD average

Business services

34.8 23.9 23.9 21.1 68.1

Communication services*

37.5/62.5 4.2/66.7 25.0/50.0 16.9/na 36.6/na

Construction and construction- related engineering services

80 100 0 26.3 82.2

Distribution services

60 60 0 10 65.6

Educational services

0 0 0 3.8 44.4

Environmental services

0 0 0 1.6 70.8

Financial services**

94.1/94.1/94.1 76.5/82.4/88.2 76.5/82.4/82.4 44.5/na/na 88.9/na/na

Social and healthcare services (not included in*)

0 0 0 7.8 15.3

Tourist services

100 25 75 67.2 72.2

Recreational, cultural and sports services (excluding audiovisual services)

0 0 0 8.8 37.8

Transport

0 14.3 5.7 8.4 27

Other services

0 0 0 0 0.1

Maximum

100 100 82.4 67.2 88.9

Minimum

0 0 0 0 0.1

* GATS 1994/ GATS Fourth Protocol.
** GATS 1994/ GATS Second Protocol/ GATS Fifth protocol.
Source: Based on Berlinski and Romero (2001).

 
 

Table 4
GATS: Commitments on Market Access: Average Openness Level on a Scale of 0–4 (with 4 being Complete Liberalization), by Sector*

 

Argentina**

Brazil

Chile

Latin America average

OECD average

Business services

3.5 1.2 1.4 2.3 3.2

Communication services

3.5 2.5 2 2.4 3.2

Construction and construction-related engineering services

3.5 1.5 0 2.5 3.2

Distribution services

3.5 1.8 0 2.3 3.1

Educational services

0 0 0 1.3 2.8

Environmental services

0 0 0 0.5 3.2

Financial services

2.3 0.7 1.5 1.6 2.3

Social and healthcare services (not included in 1)

0 0 0 2.7 2.6

Tourist services

3.5 1.5 3.5 2.6 3.2

Recreational, cultural and sports services (excluding audiovisual services)

0 0 0 3.1 3.3

Transport

0 1.3 2 2.8 3.1

Other services

0 0 0 0 3.3

Average

3.3 1.5 2.1 2.2 3.0

Standard deviation

0.5 0.6 0.9 0.7 0.3

Maximum

3.5 2.5 3.5 3.1 3.3

Minimum

2.3 0.7 1.4 0.5 2.3

* Figures only include commitments undertaken in GATS94.
** All commitments made by Argentina in Mode of Supply 4 include horizontal restrictions, thus leading to a maximum average openness level of 3.5.
Source: Based on Berlinski and Romero (2001).

Apart from that novelty, services negotiations were characterized by inherent complexities. On the one hand, the service sector includes a broad range of activities, most of them heavily regulated by different layers of government. Since border barriers are an exception (and when they exist they are seldom the most relevant restriction on services trade), national officials had to review a large number of dispersed domestic regulations and understand their relevance for the issues under negotiation (such as market access and national treatment). On the other hand, statistical information on services trade was scarce, unreliable and generally unsuited for providing a basis for negotiation (Marchetti 1999). These challenges were compounded by the fact that GATS adopted a broad definition of ‘services trade’, which included domestic sales of services made by foreign-owned companies established in the domestic market (strictly speaking, ‘investment in the provision of services’).

Immediately after the launching of the Uruguay Round (UR) in 1986, the Argentine government allocated the functional responsibility for the technical work on services trade to the Economy Ministry, at that time still responsible for the conduct of international trade negotiations. In 1988 that agency produced one of the earliest proposals on services negotiations submitted to the GATT by a developing contracting party.(9) When responsibility for international trade negotiations was transferred to the Ministry of Foreign Relations and International Trade in 1989, a small task force was organized in the newly created Secretariat of International Economic Relations (the Economy Ministry staff hitherto responsible for the negotiations were transferred to the new agency). One of the first activities of the task force was to make a survey of those domestic regulations with implications for international trade in services. This demanded regular consultations with other public-sector agencies, such as the Central Bank, the Insurance Superintendent, the Secretaries of Communications, Transportation and Tourism, the National Immigration Service and other agencies with normative and regulatory responsibilities for public utilities.

Many public officials interviewed underlined that one of the major obstacles faced was not so much that of gathering the required normative information, but interpreting it in the light of what was necessary to build a national list of commitments. Moreover, in areas where there was not a single responsible agency (such as business services), the task force had to engage directly in identifying existing regulations and drawing direct inputs from the private sector (such as professional associations). During this stage the task force consulted regularly with the private sector (first informally and later through formal channels) to identify sensibilities, barriers to access to third markets, and domestic regulations relevant to the preparation of the list of commitments.(10) Commercial representations abroad also researched market access and regulatory restrictions that affected Argentine service suppliers. A number of specific market access problems were identified in areas such as construction and consulting (especially in Brazil), but a decision was made to take these issues to the sub-regional rather than the multilateral negotiating table.

 

Stage 2: accounting for Argentina’s GATS offer    back to top

Argentina submitted an initial offer at the beginning of 1991, more than two years before the presentation of the final list in 1993. We were unable to reconstruct the changes made to the initial offer, but some public officials interviewed mentioned that the final list was ‘technically superior’ to the initial offer (due to an ongoing ‘learning process’) and responsive to some requests made by other contracting parties (particularly the United States). However, there seems to be a consensus that the major factor that shaped the content of Argentina’s final offer was the environment of deep regulatory change that prevailed between 1990 and 1997, when the last protocol was negotiated. In effect, during these years Argentina entered into an ambitious process of reform in which economic institutions were overhauled. The GATS offers largely reflect this phenomenon.

The list of Argentina’s horizontal commitments (exceptions) is very short. In line with what most countries did, in Mode 4 it includes binding commitments only for senior business employees (executives, managers and specialists).(11) The Argentine list also includes a horizontal restriction to the acquisition of real estate in border areas (150 sq km inland and 50 sq km in coastal regions) in Mode 3, which remains unbound.(12)

Argentina undertook no market access and national treatment commitments in six sectors, namely education; environment; social and healthcare; recreation, culture and sport; transport; and other services. These exclusions were not unique to the Argentine offer, but very much in line with those of other developing countries, which have typically undertaken very few commitments in these areas.(13) In sectors such as social and healthcare services and education, one major reason for omission was the extensive presence of the public sector. In others, such as environmental and other services, technical uncertainties and poor information may have also played a role. In transport, the limited extent of commitments was a result of the combination of the Argentine authorities’ preference for a ‘clean list’, the uncertainty as to the evolution of some regulatory frameworks (such as in the railways), and the lack of interest of OECD countries in agreeing in certain areas.(14) In the business services sector, where the Argentine offer shows a comparatively low coverage ratio, domestic interest groups, technical complexities and limited information also played a role, taking into consideration in particular the limited availability of qualified human resources. The preference for a ‘clean list’ shows itself in the fact that in those areas in which Argentina made commitments, these were taken under the ‘no restrictions’ modality.(15) Ex post facto, some testimonies also pointed to strategic considerations (‘we should keep some bargaining leverage’).

In the five remaining service sectors (of which finance and communications stand out in terms of economic significance), the extent of the commitments was comparatively generous in terms of both coverage and depth. Argentina undertook all its commitments in financial services during the UR, meaning that it did not take part in the negotiations of the second and fifth protocols. This suggests that strategic or reciprocity considerations, the last of which was at the centre of financial services negotiations, did not play a relevant role. Instead, the evidence seems to suggest that the financial services offer was used as a ‘lock-in’ device for autonomously taken policy reforms. The only sub-sectors unbound were services auxiliary to insurance (including broking and agency services), other financial services and new financial services (except national treatment for commercial presence, bound without restrictions). Most restrictions on financial services applied to cross-border trade. Insurance and insurance-related services were either unlisted or listed with restrictions (except maritime and air transportation insurance). Insurance services were unbound for Modes 1 and 2 (market access and national treatment). Mode of supply 3 was restrained by the suspension of new authorizations for establishment (removed in 1998).(16) Reinsurance services were listed with no restrictions except for commercial presence, subject to the same constraint as general insurance services.(17) Banking services were listed with no restrictions, except for cross-border trade (unbound). Argentina’s offer in banking services is quite open when compared with other countries in the region, and the depth of commitments is similar to the OECD average.

In the case of communications Argentina undertook commitments for approximately two-thirds of the total number of negotiable items.(18) Telecommunication services were bound in the context of the negotiations of the basic telecommunications protocol agreed after the conclusion of the UR.(19) Local telephone services, domestic and international long-distance, international data transmission and international telex services were bound without restrictions after 11 August 2000 for Modes 1 and 3. Mobile telephone services and PCS were bound without restrictions, but in the case of PCS the authorities retained the capacity to determine the maximum number of operators per area. Domestic data and telex transmission, electronic mail, voice mail and electronic data interchange were bound with no restrictions. The Argentine offer did not include the provision of satellite facilities of geo-stationary satellites operating fixed satellite services, which, in addition, was excluded under the GATS Article — exception.(20)

In the sector of construction and construction-related engineering services all sub-sectors were bound with no restrictions except for general construction works for civil engineering, which was excluded. The reason for excluding this sector is related to domestic interest groups and, according to some of the negotiators, strategic considerations such as keeping leverage for future negotiations, including regional preferences under GATS Article V (Stancanelli 1997).

In distribution services, Argentina bound with no restrictions retailing and wholesale trade services and franchising. No commitments were undertaken for commission agents’ and other services. Tourism and travel services, at last, were bound with no restrictions.

Based on this examination and our interviews, it is a plausible hypothesis that Argentina’s GATS offer was seen as a mechanism to send a strong signal of commitment to economic reform and to ‘increase the costs’ of future policy reversals. This liberalization drive was led by the Economy Ministry, headed by the architect of the economic reforms and a former Minister of Foreign Relations (1989-90). According to testimonies, in a context of deep regulatory reform the outstanding policy guideline behind Argentina’s commitments in GATS was to strengthen the reform process, either by ‘locking-in’ reforms already undertaken or by submitting a ‘clean list’ that would show limited government interventions. In the words of a senior negotiator, the GATS was regarded as ‘an opportunity to bind internationally some of the reforms undertaken’ (Stancanelli 1997). Another senior trade official wrote that the predominant thrust of Argentina’s services offer was to provide ‘an anchor to domestic reform’ (Niscovolos 1991) and to ‘prevent a return to protectionist policies’ (Niscovolos 2003).

In a few sectors (such as business, insurance, construction and construction-related engineering services) the pressure of domestic interest groups may have also played a role. However, in general the participation of the private sector in the preparation of Argentina’s list of offers was very limited. Most negotiators interviewed referred to the limited engagement of the private sector and the lack of technical preparation and understanding of the GATS. According to various testimonies, meetings organized to gather information to build the Argentine offer frequently ended in a list of demands over domestic policies (such as tax policy) rather than international negotiations. The GATS was regarded as something distant and unrelated to business concerns, probably increasing the discretion of national authorities.(21)

 
 

IV. Conclusion    back to top

The elaboration of the GATS list of commitments faced many technical and information obstacles. In contrast to the GATT agreement, negotiating the GATS required close co-operation between different governmental agencies and an adequate understanding of a regime still in the making. In addition, the extended regulations which typically characterize the service sector demanded a significant effort to understand their meaning and significance from the standpoint of market access and national treatment. Doing this work ideally required multi-agency teams of highly trained personnel, which were frequently scarce.

Argentina’s list of commitments in the GATS was characterized as ‘exemplary’. Indeed, the available evidence suggests that Argentina undertook broader and deeper commitments than its neighbours, including an outward-oriented country such as Chile. Moreover, in sectors such as telecommunications and financial services Argentina’s commitments were close in coverage to the OECD average. In those sectors in which Argentina undertook commitments, they were even deeper than the OECD average.

The major driving force behind the construction of the Argentine list of commitments seems to have been to ‘lock in’ economic reform initiatives, especially in communications and financial services (two of the service sectors with the largest economic impact). Other participants demanded concessions from Argentina (especially in telecommunications), but the extent of commitments seems to have been basically driven by domestic considerations, rather than external pressures or strategic considerations. This approach may reduce leverage in future multilateral as well as preferential negotiations, as shown by intra-Mercosur negotiations and other inter-regional preferential negotiations, such as that between Mercosur and the European Union.

Placing bargaining or strategic considerations in a secondary place as opposed to unilateral reforms may be justified on efficiency grounds. The objective of this case study was not to criticize a particular policy choice, but to underline the domestic roots of trade policy-making and, in this particular case, the driving force of policy-makers willing to ‘lock in’ a policy regime and send strong signals to the market. If the anticipated efficiency gains do not materialize in the future, responsibility should not be assigned to the rules that govern the multilateral trading regime but to the peculiarities of the domestic policy-making process.

 
 

Bibliography

Berlinski, J. (2002), Dimensiones del Comercio de Servicios en la Argentina, Buenos Aires: ITDT/Siglo XXI Editores
 
Berlinski, J. and Romero, C. A. (2001), ‘Las concesiones de Argentina, Brasil and Chile en el GATS y la competitividad internacional de Argentina’, processed
 
General Agreement on Trade in Services
 
Harms, P., A. Mattoo and L. Schuknecht (2003), ‘Explaining liberalization commitments in financial services trade’, World Bank Policy Research Paper 2999, March
 
Hoekman, B. (1995), ‘Assessing the General Agreement on Trade in Services’, in W. Martin and A. Winters, eds., The Uruguay Round and Developing Countries, Washington, DC: World Bank
 
Marchetti, J. (1999), ‘El comercio de servicios en la Argentina: evidencia, intereses comerciales y estrategias de negociación’, Boletín Informativo Techint 300, Oct.-Dec. (Buenos Aires)
 
Niscovolos, L. P. (1999), ‘Comercio internacional de servicios: Argentina en el ALCA, la OMC y el MERCOSUR. Algunos aportes para enfocar la negociación hemisférica’, in Panorama del MERCOSUR 3, Centro de Economía Internacional — Secretaría de Relaciones Económicas Internacionales — Ministerio de Relaciones Exteriores, Comercio Internacional and Culto, Buenos Aires, July
 
Niscovolos, L. P. (2003), ‘Comercio internacional de servicios. Liberalización y derecho a regular, marco conceptual and aportes para las negociaciones’, Boletín Informativo Techint 311, Jan.-April (Buenos Aires)
 
Stancanelli, N. E. (1997), ‘El comercio de servicios. Cuestiones principales desde una perspectiva latinoamericana’, CEI, Centro de Economía Internacional — Secretaría de Relaciones Económicas Internacionales — Ministerio de Relaciones Exteriores, Comercio Internacional and Culto, Buenos Aires

 
 

NOTES:
1.- We interviewed — either orally or in a written form — more than a dozen public-sector officials directly engaged in the negotiations. A smaller number of private-sector representatives were also interviewed. back to text
2.- In their study of the determinants of financial services commitments, Harms, Mattoo and Shuknecht (2003) argue that, at least in the area of financial services, ‘a government’s decision to liberalize may be affected by the economic environment, particularly the degree of macroeconomic stability and the quality of prudential regulation’, although they underline that the relationship is ‘not obvious’. back to text
3.- The standard methodology used by Berlinski and Romero (2001) is subject to well-known limitations, of which they are well aware. First, the absence of commitments should not be taken as equivalent to the existence of restrictions, since a low level of commitments can reflect strategic behaviour. Second, the summary ratios used in Tables 5 and 6 (see below) provide little information about the nature or economic significance of existing restrictions and/or concessions. Third, for the same reasons the ratios developed by Hoeckman (1995) provide a fragile basis for cross-country or cross-sector comparisons. However, a qualitative examination of the offers seems to confirm the more ‘liberal’ bias of Argentina’s offer. back to text
4.- Six hundred and twenty is the product of 155 sub-sectors and four modes of supply (cross-border trade, consumption abroad, commercial presence and movement of natural persons). back to text
5.- Commitments made in the original list (GATS94) and in four additional protocols (Financial Services — July 1995, Movement of Natural Persons — July 1995, Basic Telecommunications — April 1997, and Financial Services — November 1997). Argentina made commitments in addition to the GATS94 list only in the Basic Telecommunications protocol. back to text
6.- Considering exclusively the GATS94 list, the sector coverage undertaken by Argentina and the degree of openness it offered were considerably higher than the Latin American average. Brazil and Chile were also above the Latin American average in terms of sectoral coverage, but well below in terms of depth of commitments. back to text
7.- In the GATS94 list, Argentina’s share of no-restriction commitments was even higher than the OECD average (but the sector coverage was lower). Brazil has yet to ratify the commitments undertaken in the Financial Services and Telecommunications protocols. If these still not ratified protocols are not considered, Brazil’s sector coverage ratio falls from 36.1% to 25.2% and the non-restriction to total commitments ratio from 22.3% to 12.2%. back to text
8.- This, of course, was not unique to Argentine trade officials. The first academic works dealing with trade in services were published in the second half of the 1980s. back to text
9.- This contrasted with the more ‘defensive’ stance adopted by other developing countries, such as India and Brazil. back to text
10.- All the interviews indicated that the response given by the private sector was very passive. back to text
11.-  Argentina also did not participate in the negotiations through which a small number of countries adopted additional commitments for movement of physical persons. This was the third protocol, adopted in July 1995 and in force since January 1996. back to text
12.-  Current legislation demands prior authorization from the Border Superintendent. Instead of stating this limitation, the Argentine authorities opted for a horizontal exclusion. back to text
13.-  The Latin American average for the ratio of negotiated commitments as a share of total negotiable items in these sectors is less than 10%. The ratio is also comparatively low in OECD countries (except for environmental services), but still higher than the Latin American average. back to text
14.-  In some activities (such as air and maritime transportation) there was limited interest on the part of OECD countries in undertaking commitments. In effect, after the conclusion of the UR the Argentine government made commitments in the context of the negotiations for a protocol on maritime transportation, but these negotiations broke down. The US administration did not push for negotiations in coastal maritime services and air transportation either. back to text
15.-  Except the horizontal restrictions that affect Mode 4. back to text
16.-  Strictly speaking, until 1998 the access of foreign firms was possible through the acquisition of existing insurance firms (Berlinski 2002). Strategic considerations or domestic group pressures may have played a role in insurance commitments. back to text
17.-  The United States and the EU pressed the Argentine government to deepen its commitments in insurance. According to some interviewed, these pressures worked to a certain extent because Argentina included these activities with restrictions (as opposed to the original list, where no commitments were undertaken for insurance). Cross-border trade (except for freight insurance) is unbounded and the authorization of new entities is suspended (however, the deregulation implemented in 1998 ended the suspension in the establishment of new insurance firms). back to text
18.-  No commitments were made for postal, audiovisual and other services. Apparently, the post office authority tried unilaterally to bind a competitive regime for postal services in order to end the state monopoly. Audiovisual services were left unbound in line with the stance adopted by many other countries (again, the preference for a ‘clean list’ or human resource constraints may have been stronger than the desire to bind existing regulations). back to text
19.-  Argentina also adopted a voluntary reference paper that established additional commitments concerning interconnection charges and the independence of regulatory agencies. back to text
20.- The exclusion was a result of the existing contract with a private firm in charge of exploiting the two orbit positions allocated to Argentina, which required strict reciprocity. Later, Argentina negotiated bilateral reciprocal agreements with the United States, Canada, Mexico, Brazil, Netherlands and Spain. Satellite services was one of the toughest issues in negotiations with third parties, particularly the United States. Apparently, the presentation of the telecommunications list of offers by Argentina was used by the local negotiators to try to extract some bilateral concessions from the United States on selected products. This may have been a reaction to the demands of the US government concerning the level of commitments to be undertaken in this sector. back to text
21.- In 1987, shortly after the launching of the Uruguay Round, the private sector created the Unión de Entidades de Servicios (UDES), which reunited several service business federations. However, UDES had very limited success in mobilizing the private sector or making substantive contributions to the policy-making process. back to text
 

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* Roberto Bouzas is Associate Professor, Universidad de San Andrés. Hernán Soltz is at FLACSO, Argentina. We are very grateful to those who agreed to share their time and experience with us. Although this summary risks misrepresenting individual opinions, we hope that it will provide an accurate account of trends and events.