3 June 2005

NZ's revised offer in WTO services negotiations

New Zealand is to table a revised offer in the World Trade Organisation's General Agreement on Trade in Services, Trade Negotiations Minister Jim Sutton said today.

Mr Sutton, currently at the trade ministers' meeting in Jeju, South Korea, said that the revised offer would be made public when it had been submitted to the WTO Secretariat in Geneva early next week.

He said New Zealand's revised offer would be a further step in a negotiating process that would open doors for New Zealanders providing their skills and creativity around the world.

"My discussions with my APEC colleagues here in Korea have made it more clear than ever that the WTO Doha Round will only succeed if there is a balanced outcome across its three main components of agriculture, non-agriculture products and services. As well as being designed to advance the interests of New Zealand services exporters, our participation in the services negotiation is also an investment in securing the improvements we seek in access for New Zealand's agricultural and other products to world markets.

"Services now account for 66% of economic activity in New Zealand. Consisting of such things as the provision of professional advice and consultancy, tourism and earnings from foreign students, services now represent 28% of New Zealand's exports. Exports of services are now growing faster than those of agricultural products. This reflects the success of Government policies, such as the Growth and Innovation Framework, designed to grow New Zealand's knowledge based economy.

"The WTO services negotiations provide an opportunity for New Zealand to leverage off our existing policies.

"This revised offer ? like the earlier one in 2003 ? is made only on the condition that other WTO members make similar commitments. If they do not, we will either scale it back or withdraw it.

"The Government will only confirm the offer if the overall outcomes of the services negotiation and of the Doha Round as a whole produce results of sufficient benefit to New Zealand."

Mr Sutton said that it was important to be aware that successful GATS negotiations could allow developing countries to enhance their participation in the global economy.

Developing countries have put down a marker that they need changes in services trade rules in areas of interest to them before they can agree to the outcome of the Doha Round as a whole. Developing countries are particularly keen to see better access for their services exporters to enter other markets temporarily to deliver their services products. New Zealand's revised offer has been designed with developing countries needs very much in mind.

New Zealand's revised GATS offer would cover the following areas: · legal services; · the temporary movement of business people; · the removal of redundant producer board references; · other commercial services: new commitments for business tax and consulting services, duplicating services, mailing list compilation and mailing services, miscellaneous business services, telephone answering services, and washing/cleaning/dyeing services; and · removal of a further exemption to the WTO's "most favoured nation" principle, leaving only one exemption remaining.

Mr Sutton emphasised that the revised offer would be consistent with the Ten Guiding Principles that the Government had adopted in 2003 for the formulation of New Zealand's initial WTO services negotiating position. This means that: · public health, public education, social welfare, and water distribution systems will not be included;

· local councils will not lose their right to take actions in the interests of their communities;

· Maori interests, including the provisions of the Treaty of Waitangi, will be protected;

· There will be no implications for the screening mechanisms for foreign investment nor will Kiwishares be affected; and

· New Zealand's immigration regime will not be affected nor will access to New Zealand's employment market be included.

Mr Sutton said that all parties likely to be directly affected by New Zealand's revised offer had been fully consulted in its preparation.

Once the revised offer has been submitted to the WTO Secretariat in Geneva early next week, it will be available on the Ministry of Foreign Affairs and Trade website at: www.mfat.govt.nz.

ENDS

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