Rohee says...
Services sector support crucial for FTAA negotiations

Guyana Chronicle
January 31, 2003

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MINISTRY of Foreign Trade and Economic Cooperation is taking the initiative to sensitise the relevant sectors of the economy and the general Guyanese public to the issues involved ahead of negotiations, scheduled to begin in July, for the FTAA (Free Trade Area of the Americas).

Towards that objective, the ministry, in collaboration with the Private Sector Commission (PSC) and the United States Agency for International Development (USAID) Guyana Economic Opportunities Project (GEOP), sponsored an awareness seminar on trade in services.

The participants at the Monday session were people involved in business, communications, transport, construction and related engineering, distribution, education, environmental, recreational, cultural and sporting enterprises.

Organisation of American States (OAS) Deputy Director, Trade, Dr Sherry Stephenson was the main presenter at the forum in Le Meridien Pegasus Hotel, Georgetown and Minister of Foreign Trade and Economic Cooperation, Mr Clement Rohee, USAID Director, Mr Mike Sarhan and GEOP Coordinator, Mr Tom Whitney were among other speakers.

Rohee said the Caribbean Community (CARICOM), having committed itself to a specific programme of implementation which requires the Caribbean Single Market and Economy (CSME) to be in place by the end of 2005, has a mandate to present its initial market access offers by February 15.

Cognisant of the timetable, he said, over the past month, his ministry has been in consultation with local service providers, with a view to establishing a National Association of Service Providers.

Rohee said that is an extremely important step for the complex negotiations, because the Government alone cannot do it and, in order to overcome the invisibility of the services industry, the immediate first task is to develop a widespread awareness of its vital contribution to national economies, in terms of jobs and wealth creation and foreign exchange earnings.

He said his ministry hopes to launch the proposed association some time in March.

"We are convinced that this is a step in the right direction, especially since we are now in the offers/request stage of the negotiations of services, both at the World Trade Organisation (WTO) and FTAA," Rohee said.

He lamented that, to some extent, the services sector remains somewhat invisible, signalling that it is not yet prepared for the task ahead and there is little training as yet available on marketing and exporting, for which managers need technical assistance to take advantage of the potential.

"We need to be aware of international expectations for service quality and be prepared to meet them," Rohee stressed.

He acknowledged that, over the past two decades or so, the services sector has emerged as a major contributor to economic development and global trade has expanded at a very rapid rate, particularly in the areas of business and professionalism, value added, communication, finance, entertainment, education, training and more.

Rohee said services account for approximately one-fifth of recorded world trade, as well as the majority of domestic activities in many countries and information technology (IT) has caused such a transformation that it is now not only a consequence of but a pre-condition for economic development.

He recalled that, in the 1990s, telecommunication and computer related services, such as data processing, registered increased growth in the Caribbean and, for most regional economies, the major employment is in tourism, finance, insurance, and entertainment, too, contributing more than 50 per cent of Gross Domestic Product (GDP).

Rohee remarked that, often, the potential for expanding the export of services is overlooked at the level of national development planning, because of inadequate statistics and a lack of familiarity with the activities.

"Given the fast pace at which trade in services is currently growing, it is imperative that the region is actively involved. Development globally is increasingly towards services and has seen the sector contributing an increasing share of the national output, compared with the goods producing sector," he pointed out.

Rohee said, for Guyana and, indeed, the region as a whole, developments in the various external negotiations are not divorced from the ongoing CSME regional programme.

Ultimately, to ensure continued growth and expansion of services in the region, the major constraints must be identified and addressed.

He said, in this country, it has been found that, even though the key economic activities remain focused on the tradeable goods, concentrated on the traditional commodities such as rice, sugar, rum and bauxite, among others, there is growing evidence of the potential for developing the contribution of the services sector in expansion and diversification of the national economy.

In order to make this sensitisation process possible, Rohee urged that the Private Sector pay more attention to broadening and deepening its understanding of services and the potential for the modernisation of the national economy.

"We need to do so quickly, not only in relation to the rapid development in the multilateral trading environment, but importantly, for the critical issues that need to be addressed in the context of our own national development," he explained.

Looking at the implications of the free movement of services, Rohee said it is quite possible that, when Protocol II on the Rights of Establishment of Regional Services and Movement of Capital becomes fully operational, service providers from any country in the Caribbean, who are party to that covenant, would have the right to come to Guyana and establish a service providing agency.

By the same token, Guyanese will also be entitled to do likewise but, so far, many foreign businesses have already been zeroing in on the movement of cross border services to which Guyana has opened up itself.

Director David Yankana said the PSC had previously organised some 40 hours of training, through CARICOM, for bankers and insurance companies, to make them familiar with what is expected in the liberalisation of financial services.

He agreed on the importance of trade in services and participation of the Private Sector at the negotiating table.

Mr Yankana said, once persons live anywhere between Belize and Suriname, they would be able to establish services anywhere in this country, although the same is not applicable in other countries of the region.

He said concerns have been expressed over that situation but reciprocal arrangements have not yet been finalised, in terms of the free movement of skills and services.

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