In the lead up to the WTO Ministerial in December in Hong Kong, Australia is playing a key role in proposing and supporting radical changes to the negotiating process in GATS. If accepted, these proposals will pressure countries to make more and ‘higher quality’ commitments in GATS. There is a growing community campaign in Australia and globally, demanding that essential services be exempt from GATS negotiations. It is feared that these proposals will undermine this campaign and will force countries to make commitments across a number of essential service sectors.

The proposed changes to GATS negotiations, known as ‘complementary’ or ‘benchmarking’ proposals, will undermine the supposedly voluntary nature of GATS. Under the current structure of GATS, countries determine whether and in which sectors they will make commitments according to the conditions in each country. The proposed changes will replace this flexible approach with a system of mandatory liberalisation, whereby countries are forced to open their service sectors to a minimum level across a minimum number of ‘commercially valuable’ sectors. For ‘commercially valuable’, read essential services, such as health, education, public transport or postal.

These proposed changes would be most greatly felt in developing countries. Transnational companies in the developed world currently control 80% of services trade and most local service providers will not be able to compete with giant transnational companies. Forced liberalisation will mean the governments have to give transnational service companies the same treatment as local service companies. This will destroy local industries and threaten affordable access to essential services such as health, education, water and energy.