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1 Measuring GATS Mode 4 trade flows Contact: [email protected]

1 Measuring GATS Mode 4 trade flows Contact: [email protected]

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Page 1: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Measuring GATS Mode 4 trade flows

Contact: [email protected]

Page 2: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Sales of Services by GATS Modes of Supply: 2005 Statistical Approximation

Mode of Supply Estim ated share

1 - cross-border supply 25 - 30 %

2 - consum ption abroad 10 – 15 %

3 - com m ercia l presence 55 - 60 %

4 – presence of natural persons less than 5%

Page 3: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Trade in services statistics

• By service sectors• By partner• By modes of supply

Compilers of Statistics BOP/FATS

Trade Negotiators

Page 4: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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The four modes of supply: statistical simplified criteria

Consumer or property located

Supplier Supply through:

Outside territory of residence

has no presence in consumer’s territory

Mode 2 (BOP, tourism statistics)

Mode 1 (BOP)

Mode 3 (FATS, FDI)

Mode 4 (BOP, migration, tourism statistics)

Commercial presence

has presence within consumer’s territory

Within territory of residence

Presence of natural persons

Page 5: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Main Issues for Measuring Mode 4

Mode 4 in MSITS

• The Manual on Statistics of International Trade in Services (MSITS) recognises that a statistical framework needs to be developed for measuring Mode 4

• Annex in MSITS as a first step

Main statistical issues

• Determining the coverage of Mode 4

• Only fragmentary indicators available

• Determining the indicators to measure Mode 4

Page 6: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Mode 4 Information needs

Value of trade: Balance of Payments services trade

Contractual service suppliers as employees of service suppliersent abroad to fulfill a contract between his employer and consumer

Self-employed going abroad to fulfill service contract (independent professionals)

• Contractual service suppliers as employees• Self-employed• Intra-corporate transferees, employees of foreign affiliates• Service sellers / persons responsible for setting up commercial

presence

Number of persons (flows and stocks): Tourism and Migration statistics

Page 7: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Options to assess Mode 4 delivery in surveys

1.Did the service delivery involve physical presence of service provider?

Yes? Then, how was most of the service value delivered (time/resources)?

Mostly by fax, email, etc.

Natural person at the end (e.g. to supervise)

Mode 1

The person’s knowledge was essential

to deliver the service

Mode 4

2. Require in specific surveys allocation by each GATS mode of supply

3. Require estimated share of inputs for the service trade related to mode 4

Page 8: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Balance of Payments Services Main Components

5. Telecommunications, computer and information services

6. Construction

7. Insurance and pension services

8. Financial services

9. Charges for the use of intellectual property

10.Other business services

11.Personal, cultural and recreational services

Commercial services:

1. Manufacturing services on physical inputs owned by others

2. Repairs and maintenance

3. Transportation

4. Travel

5. - 11. Other commercial services

12. Government goods and services (not in GATS)

Page 9: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Australia, exports of services by mode of supply, 2002-03

Mode 219.4%

Mode 362.7%

Mode 111.9%

Other5.9%

Mode 1+45.6%

Mode 2+40.1%

Mode 3+40.1%

$3.2 billion

Page 10: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Commercial presence, $64m, 16%

Fly in-fly out, $106m, 26%

Australian projects,

$238m, 58%

Australia's legal services export income by mode of supply, 2004-05(million USD and percentage)

Source: ILSAC Survey of Australian Exporet Market for Legal Services 2004-05

Page 11: 1 Measuring GATS Mode 4 trade flows Contact: joscelyn.magdeleine@wto.org

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Mode 4, migration and tourism statistics

Migrant categories

Non-migrant categories

Categories of the UN Recommendations

on Statistics of International

Migration, revision 1:

Length of stay of individuals

Purpose of trip or migration Less than 3 months

3 to 12 months

more than 12 months

Visitors Personal International

Holiday, leisure and recreation Recommendations on Visiting friends and relatives Tourism Statistics 2008 Education and training Health and medical care Shopping Etc.

Business and professional X x Contractual service supply X x - self-employed a X x - employed X x Intra-corporate transfer X x Serv. salespersons/ commercial pres. X x Other

Employment (migrant workers, employment-based settlement)

Intra corporate transfer x X Directly recruited by a foreign

established company x X

International civil servants Other

Family reunification/formation Etc. a

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New Chapter in revised 2010 Manual

• More on services delivery compared to BOP services transactions

• Chapter on modes of supply/mode 4:• Scope of chapter• Defining modes of supply• Mode 4 and relevant information for measuring• Allocation by mode of supply for measuring value• Additional indicators for analysis: number of persons

• Worldwide consultation deadline: 24 November 2008

Revis

ion 2

010

More information: http://unstats.un.org/unsd/tradeserv/msitsintro.htm