WTO must protect service sector in Third World: Indonesia

JAKARTA (JP): Indonesia and other ASEAN countries have asked the World Trade Organization to protect the service sector in developing countries.

Director for Multilateral Cooperation at the Ministry of Industry and Trade Herry Soetanto said here on Monday that the protection should become an integral part of the overall negotiations to open up the world's services industry.

According to him, such protection should, for example, give a country the right to decide which services should be opened to full competition.

In return, a country affected by the protectionist measures could apply to the WTO for similar protection, he said at a seminar on liberalization in the service sector.

The WTO launched negotiations on services and agriculture last year following the failure of a meeting in Seattle in December 1999 which was supposed to launch a wide-ranging round of trade liberalization talks.

WTO members will try again when they meet in Doha, Qatar, later this year.

Herry said that the negotiations were expected to be completed in March next year.

He said that without such safeguards, the Indonesian service sector would find it difficult to survive when liberalization in the service industry was fully implemented.

Ashok R. Menon, an international trade policy analyst from the U.S.-based Nathan Association Inc., said that if the WTO failed to provide such protection, Indonesia's service deficit would further increase.

According to the latest WTO data, Indonesia suffered a $7 billion deficit in the export and import of services in 1999.

"The country's deficit in services will reach $8 billion this year," he said.

He said that Indonesia must be able to improve the quality of its service sector to enable it to compete as the liberalization process was irreversible.(05)