UNDP 05/2008

Lessons for the GATS mode 4 negotiations and other

agreements

(Return) Reciprocity Revisited and Shared Responsibility within or outside

GATS mode 4

UNDP 05/2008

GATS mode 4, why not?

What’s the problem with multilaterally liberalizing access for low-skilled service suppliers?

1. Systemic problem of lack of reciprocal trade interests– Labor as a production factor does not follow the same “rules” as

goods and services liberalization

2. Structural problem with lack of “shared responsibility”– GATS mode 4 “structures” do not allow for flexibility?– or have not yet been creatively used to integrate government-

supported migration-for-development programs, transnational cooperation in combating clandestine movements and irregular stays & guarantees of worker quality & “brain drain mitigation”

3. Source vs destination country obligations and mode 4

UNDP 05/2008

Proxies, Paradoxes and Promises of reciprocal trade liberalization of labor

• Heckscher-Ohlin-Samuelson, 1930s, substitutes• Markusen, 1998 (complements)• Martin, 2006 (“hump”: complements-then-

substitutes)• Hatton and Williamson, 2005 (dual policy paradox)• Winters and Walmsely & World Bank, 2002• Pritchett, 2006 (gains from liberalized TMNP are

much larger than from further liberalizing goods and services trade)

UNDP 05/2008

Joint responsibility in managing migration

Chanda Rupa, UNDP Report 2008

“as bilateral schemes indicate, there is a joint responsibility to manage migration and thus to it is in the national interests of sending countries and the interests of their overseas workers, to develop such institutional mechanisms. Thus, there may be some merit in insisting on source country institutional obligations”

UNDP 05/2008

Shared responsibility of source and destination country

• Migration-for-development programs– Increase development dividends of labor migration

• Cooperation with non-state actors

• Ensure quality of work and work experience– Screening, selection, clearing mechanisms that are transparent

• Cooperation with international organizations

– Pre-employment training and pre-departure orientation• Cooperation with employers, employer unions

• Combat clandestine immigration and irregular overstays– Police cooperation

• Inter-state cooperation between host and source country

which of these can be operationalised in scheduling structure of GATS and how?

UNDP 05/2008

Combating clandestine flows and irregular overstays thru GATS mode 4?

Is conditioning market access in GATS mode 4 to the conclusion of a bilateral migration management agreement (containing readmission, voluntary return, but also mutual recognition and pre-employment training) be inconsistent with GATS/WTO?

yes, likely to be inconsistent with unconditionalunconditional MFN clause, unless in an additional commitment? Or, if part of domestic immigration legislation, which is carved-out from GATS as laid down in TMNP Annex?

UNDP 05/2008

What bilateral labor migration agreements can do that GATS mode 4 does not (yet) do

• shared responsibility schemes for migration issues ancillary to economic activity abroad– “mobilize” non-state actors

• Immigrant associations: facilitating integration in host country society, joining forces with educational and vocational training centers for skill upgrading prior to voluntary return

• International organizations: technical support in selection and hiring processes (IOM) and human capital development (UNESCO)

• Employer/enterprises of destination country cooperate transnationally with manpower agencies in country of origin

• Diaspora and immigrant associations offer access to micro-credit lines for entrepreneurial return migrants (Birima-Benetton, others)

UNDP 05/2008

Administrative-intensive vs. private-sector integrative migration management

• Spain’s agreements with Senegal • Tough and low:

– transparent trade-offs with irregular migrants

• Prospecting missions of private sector (Carrefour, McDonald’s, Vips, Barcelo and McSolar hotel groups)

• Opening of vocational training centers in Senegal

• Observatory• Guichet (combines marketing of

foreign employment abroad and matches demand and supply)

• Access to credit lines for sponsored by government is only examined for “viability”

• France’s agreements with Senegal • Soft & high:

– combating root causes of migration thru human capital development, admissions de facto limited to highly-skilled

• State provides for access to credit lines for entrepreneurial return migrants

• No pre-employment training (France exported its educational and vocational training system as a whole)

• Observatory• Mixed recruitment and selection

committee

UNDP 05/2008

Where to frame source country obligations or shared responsibility schemes in GATS?

Market access National treatment

Additional commitment

unconditional MFN

unconditional MFN

MFN unconditional?

Or: immigration legislation carve-out in TMNP Annex

Or: require source country to undertake labor migration management obligations into mode 3 and mode 4 commitments it would offer?

UNDP 05/2008

Choice of migration liberalization & management scheme

BLA RLA (migration-partnerships)

GATS mode 4

Tactical issue linkages

Cross-modal & cross sectoral trade-offs

Unilateral immigration legislation

UNDP 05/2008

GATS & WTO inconsistencies of BLAs

– Pre-employment training requirement in mode 4 commitments for certain (low)-skills?

– Linguistic requirements– Government-sponsored access to credit lines

for return migrants, tax breaks, special savings accounts