Trade in Services in the SADC Region
The services sector in the SADC region is characterised by moderate investment, comparatively high cost and limited access to services by the general public. At the same time, it is acknowledged that services are the most important part of Southern African economies and are also important inputs to production in all sectors. Services are important elements for growth and competitiveness.
Most SADC Member States adopted services sector liberalization policies in the 1990s providing limited market access to foreign services suppliers, including through foreign direct investment. In 1995, all SADC MS (except the Seychelles) became WTO Members and undertook binding liberalization commitments through the GATS and bilateral agreements.
SADC Member States recognize that the deeper integration not only of trade in goods, but also of their services markets holds great economic potential. In the SADC Treaty Member States undertook to develop policies aimed at the progressive elimination of obstacles to the free movement of capital and labour, goods and servicees. The RISDP paragraph 220.127.116.11, recalls the objective of eliminating obstacles to the free movement of capital, labour and goods and services and the improvement of the region's economic management and performance through regional cooperation with the ultimate goal of eradicating poverty, and foresees the establishment of a Common Market through removal of barriers on factors of production. Whereas SADC has concentrated its efforts towards establishment of a Free Trade Area for goods, work on policies to eliminate obstacles to the movement of services has to date progressed slowly. Protocol on Trade in Services was a signature by Heads of State/ Governments in August 2012.
It is important to note that the Protocol on Trade in Services provides for a mandate to progressively negotiate removal of barriers to the free movement of services, but does not bring about any integration of markets in and by itself.
SADC Ministers of Trade decided in November 2011 to commence with negotiations on the liberalization of six priority sectors (communication services, construction services, energy-related services, financial services, tourism services, and transport services). These negotiations are expected to result in market access commitments that will provide a predictable legal environment for trade and investment in the sector within the region.
The first Round of Negotiations on liberalisation commitments in the six priority sectors commenced in April 2012 by developing a roadmap of negotiations. It is expected that the round will be concluded in 3 years.