Why does the EPA include provisions on services?
Given the economic importance of the services sector to both the Caribbean and the European Union, the volume of trade in services between the two regions, and the inter-dependence of the services sector with manufacturing and agriculture, the EPA necessarily includes rules for the treatment of services suppliers and the provision of services. Sixty percent of all CARIFORUM services exports to the EU are in tourism and travel-related services. CARIFORUM has negotiated rules and market access concessions on services in the EPA as the Services sector, especially the knowledge-based services sub-sector, presents the best prospect for economic diversification and global repositioning because of its value-added potential. For CARICOM (excluding Trinidad and Tobago), services account for approximately 62% of total exports, and in the case of the OECS countries, averages approximately 80% of total exports. Services exports therefore account for the major share of total exports of individual CARICOM countries, with the exception of Trinidad and Tobago, Guyana, Belize and Haiti. Services output relative to total GDP for CARICOM countries was over 60% between 1996 and 2004 for the MDCs and over 80% for the LDCs. The EU has a growing economy and represents a viable market of approximately 457 million persons in 27 countries, with a GDP per capita (purchasing power standard) of US$ 23,500.80 (2004). The EU has great potential to absorb increased services exports from CARIFORUM as its import penetration rates for goods and services have increased between 2000 and 2005.
What are the provisions on Services in the Agreement?
In the case of Services, there are specific provisions on the regulatory framework and cooperation for several key sectors, notably:
- Tourism
- E-commerce;
- Courier;
- Telecommunications;
- Financial services; and
- Maritime transport;
- Cultural and Entertainment Services
With respect to professional services, there are also provisions for cooperation and mutual recognition of qualifications as well as technical assistance for the tourism sector. With respect to the movement of services suppliers between Europe and the Caribbean, the EPA includes special provisions for Short Term Visitors for Business Purposes. This allows CARIFORUM nationals to visit the EU for brief periods for business reasons related to research and design, marketing, training, trade fairs and sales. While the EPA does not commit the Parties to the issuing visas, both sides have committed to making movement across borders easier.
Does the Agreement on Services and Investment include provisions for assistance of CARIFORUM States?
Yes. The EPA has complementary development and trade components. The Agreement on Services and Investment includes provisions on development cooperation from the EU to address a range of needs in the Caribbean such as developing regulatory regimes, building the capacity of regional services firms, market intelligence, interaction with EU firms, among other activities. In sector specific sections of the agreement there are also tailored cooperation mechanisms such as environmental management and equivalency in sustainable tourism standards in the tourism section, and cultural exchanges and dialogue, in the Protocol on Cultural Cooperation. Human resource development in the Caribbean is another focus of the Annex on Tourism which provides for assistance and training to service suppliers and support for training institutions. In the services agreement, there are also provisions for cooperation and mutual recognition of qualifications.
