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"Expect the unexpected"? LDC GATS commitments as internationally credible policy indicators? The example of Mali

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  • Honeck, Dale

Abstract

There is a stark contrast between the ambitious investment promotion efforts of many least developed countries (LDCs) and their often minimal commitments under the General Agreement on Trade in Service (GATS). At a time of urgent need to address domestic infrastructure and investment gaps, this situation cannot be a positive signal for investors (either domestic or foreign), and may be a missed opportunity to address services aspects of the Millennium Development Goals (MDGs). LDCs often lack internationally credible mechanisms for making commitments, which contributes to their evident difficulty in attracting the more employment-generating types of investment that could bring greater opportunities for poverty alleviation. Considering that most LDCs, under domestic laws, have already opened a wide range of services sectors to foreign direct investment (FDI), there may be an opportunity to enhance the international consistency and credibility of LDC investment promotion efforts by making GATS commitments, while preserving substantial policy space with regard to the actual status quo. While reforms to domestic regulations are undoubtedly of greater importance to attracting FDI, GATS commitments, including partial commitments, can be used to publicize LDC investment priorities in services (such as attracting new businesses, encouraging joint ventures and technology transfer, etc.), and make them legally binding internationally. Offers to make new GATS commitments can further be used as bargaining chips in the current Doha Development Agenda (DDA) negotiations. Mali has been selected as a case study, due to the fact that trade and investment policies are clearly and consistently documented.

Suggested Citation

  • Honeck, Dale, 2011. ""Expect the unexpected"? LDC GATS commitments as internationally credible policy indicators? The example of Mali," WTO Staff Working Papers ERSD-2011-07, World Trade Organization (WTO), Economic Research and Statistics Division.
  • Handle: RePEc:zbw:wtowps:ersd201107
    DOI: 10.30875/3b833310-en
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    References listed on IDEAS

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    6. Panagiotis Delimatsis, 2007. "Due Process and 'Good' Regulation Embedded in the GATS -- Disciplining Regulatory Behaviour in Services Through Article VI of the GATS," Journal of International Economic Law, Oxford University Press, vol. 10(1), pages 13-50, March.
    7. Jean-Jacques Hallaert, 2010. "Increasing the Impact of Trade Expansion on Growth: Lessons from Trade Reforms for the Design of Aid for Trade," OECD Trade Policy Papers 100, OECD Publishing.
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    Cited by:

    1. Honeck, Dale, 2012. "LDC export diversification, employment generation and the "green economy": What roles for tourism linkages?," WTO Staff Working Papers ERSD-2012-24, World Trade Organization (WTO), Economic Research and Statistics Division.
    2. Honeck, Dale & Akhtar, Md. Shoaib, 2014. "Achieving Bangladesh's tourism potential: Linkages to export diversification, employment generation and the "green economy"," WTO Staff Working Papers ERSD-2014-15, World Trade Organization (WTO), Economic Research and Statistics Division.

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    More about this item

    Keywords

    LDCs; GATS; FDI; policy credibility; MDGs; policy space; Mali; Africa; investment promotion; poverty alleviation;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • L90 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - General
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • P45 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - International Linkages

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