Quad Officials Discuss Structure of Year 2000 WTO Services Talks

The Quad countries have begun initial discussions regarding the structure for the next round of WTO services talks. At this time, however, it is not clear whether the Quad officials have agreed on an approach to the negotiations. Some reports say a "horizontal approach" has been chosen; that is, parties would make commitments across all services sectors. Other press sources indicate the United States prefers a sectoral approach, while Japan and the European Union have called for the all-inclusive, horizontal approach.

There also appears to be significant debate among the parties regarding whether to adopt a "positive list" or "negative list" model for the negotiations. Under a positive list model (which was used in the GATS Agreement itself), parties identify the sectors for which they are willing to make liberalization commitments. A negative list model (which was used in the GATS financial services and telecommunications agreements) requires parties to schedule areas for which they are unwilling to commit to liberalization.

The inconsistency in press reports regarding whether a consensus has emerged on the appropriate approach is likely a result of the preliminary nature of current Quad discussions. None of the Quad countries has formally developed their positions at this time.

We expect the positions of the Quad members to change over time, as the list of sectors to be included in the negotiations is refined and the parties are better able to assess which approach will be more effective in achieving meaningful results with lesser developed nations. Additional preparatory talks are scheduled for late September.