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Why is Trade in Services Important?

Trade in Services is ImportantTrading in services offers significant opportunities both in terms of increased exports and imports, aimed together at enhancing competitiveness, stimulating economic development and ultimately, improving welfare and reducing poverty.

On the import side, the potential competition-driven benefits of expanding the range of services available to consumers, decreasing costs and increasing quality, including through the attraction of FDI, is an oft-cited benefit from greater services imports.

On the export side of trade in services, apart from the obvious benefit of generating income/foreign exchange, there are many other benefits to developing an internationally competitive services export sector.  For one, a successful services company does not necessarily require large start-up capital, numerous employees or large financial investments to export successfully.  Therefore the potential for micro services companies to develop and trade successfully is quite feasible – a particularly important consideration in developing countries, where firms ambien buy uk tend to be smaller and more capital scarce.  This possibility can lead to the establishment of new businesses, the development of specialty services, employment opportunities and potentially reduce the ‘brain drain’ that is often associated with developing country service professionals.

Furthermore, readily available local, high quality services will not only add value to businesses across all sectors, it will reduce the need of having to import these services from elsewhere, and correspondingly lower import expenses.  The availability of local high quality services is an attraction in securing foreign direct investment as well, as this will also reduce investors’ needs to import the necessary services to maintain international competitiveness.

Lastly, services are often more ‘green’ – in that they have a comparatively smaller ecological footprint than either the agricultural or manufacturing sector (though IT-based services have raised increasing concern surrounding energy consumption).