LDC services exporters can enjoy growth potential by tapping the global market
While commercial services exports from least developed countries (LDCs) are very small, amounting to only 0.7% of world services exports, they have increased five-fold in the past decade, said World Trade Centre (WTO) Deputy Director-General Yi Xiaozhun. He stated this at the opening of the two-day seminar organised by the International Trade Centre (ITC) on ‘LDC Services: Business Success Stories and Challenges on 9 May 2014.
Mr Yi said commercial services exports by LDCs have grown from US$5.6 billion in 20013 to nearly US$30 billion in 2013, and the growth potential for LDC services exports lies in the variety of services that are available.
‘While tourism and travel are key exports for many LDCs, other infrastructure services such as transport and communication, as well as financial services, are growing in many of them,’ said Mr. Yi. ‘Several LDCs are also recording growth in the dynamic business services segment.’
The seminar, held at the WTO, brought together small and medium-sized enterprise (SME) services exporters from LDCs and representatives of business associations to share their perspectives on the challenges of tapping into the global market.
Supporting exports from key services sectors requires measured government intervention, which can ‘promote access to low-cost and high-quality services’, said Selina Jackson, the World Bank’s Special Representative to the WTO and United Nations.
‘Non-transparent or burdensome regulations can curtail competition, introduce unnecessary procedures on business and scare away possible new entrants to the market,’ she added.
As part of the dialogue, exporters from Africa, Asia, the Caribbean and the Pacific discussed practical issues they have faced – including constraints at official and regulatory levels – in delivering their services to global markets.
‘Commercial services account for only 10% of total exports from LDCs,’ said Anders Aeroe, ITC’s Director of Market Development, who chaired the event.
‘So although services represent close to 50% on average of the GDP of LDCs, exports of services are currently not contributing much to the GDP of LDCs. This is, however, also an indication of opportunities for further developing services exports from LDCs. There are many success stories on the LDC services-export sector, and ITC aims to improve understanding of the various ingredients for their achievements,’ said Mr Aeroe.
Speakers at the seminar included representatives of a healthcare association in Uganda promoting private healthcare services; a Zambian insurance company with a commercial presence in the United Republic of Tanzania, which is seeking to expand across the border to Rwanda and the Democratic Republic of the Congo. Also sharing their views were a travel-services company in Myanmar, which organizes tours in all newly opened regions in the country; and a consulting company that conducts research on the role of diasporas and trade in services in the Caribbean.
The seminar was funded by the Australian Department of Foreign Affairs and Trade.