Sixty-seven countries have delivered a landmark deal on services trade regulation that could save up to $150 billion in trade costs every year.
The World Trade Organization (WTO) announced today that a new agreement on Services Domestic Regulation (SDR) has been finalised, which will streamline and cut red tape for licensing and qualifications procedures.
The agreement, signed by WTO members that represent over 90% of global services trade, is expected to reduce services trade costs by up to 7% annually for cross-border service providers.
Set to come into force in 2023, the agreement was signed despite the cancellation of the 12th WTO Ministerial Conference, which was set to take place in Geneva, Switzerland this week.
As reported by Trade Finance Global , the Ministerial Conference was postponed indefinitely due to Omicron travel restrictions, which would have prevented ministers from at least a dozen nations from attending the summit.
In a press statement, the UK Department for International Trade (DIT) said that Britain has been a strong and vocal participant throughout negotiations, which were first launched at the 11th Ministerial Conference in Buenos Aires, Argentina in 2017.
As the world’s second-largest services exporter, the UK is among the countries positioned to benefit the most from its terms.
The DIT said that British businesses consistently cite complex administrative procedures as barriers to accessing international markets, and that the new rules will make it easier for businesses of all sizes – particularly small and medium-sized enterprises (SMEs) – to navigate foreign markets and export overseas.
Once the new rules are in force, businesses can expect licensing applications to be processed faster, with electronic copies of qualifications accepted by authorities, and an end to unreasonable and hidden fees.
Secretary of State for International Trade Anne-Marie Trevelyan said: “We are delighted to have played our part in bringing about this historic deal, which shows exactly the kind of cooperation we want to see at the WTO, and demonstrates it can deliver trade rules fit for the 21st century.”
The UK will be among a handful of nations applying the new rules across the broadest possible range of services sectors, including financial services.
The biggest savings are likely to be in finance and tech, helping to ensure that London retains its position as Europe’s leading financial centre.
Catherine McGuinness, policy chair of the City of London Corporation, said: “This is a welcome development for the UK financial and professional services sector, with global services providers set to benefit from the removal of unnecessary administrative processes that can act as barriers to market access around the world.
“Services trade is a key driver of prosperity, and this announcement will help to support the global post-COVID recovery.
“We hope that the WTO can carry this momentum into other important future policy challenges.”
In a first of its kind for the WTO, the agreement contains a provision on gender equality, which is aimed at supporting the participation of women entrepreneurs in global services trade.
The deal has also created a new baseline in international services trade, which the UK has already used as a foundation when striking free trade agreements with Japan, the European Union (EU), and Australia.