HOW WTO SERVICE NEGOTIATIONS CAN AFFECT THE VIABILITY AND

SUSTAINABILITY OF TOURISM OPERATIONS IN DEVELOPING COUNTRIES

By Sanjay Medhavi1
(Abstract)
The WTO General Agreements on Trade in Services (GATS) commits
member governments to enter into successive rounds of negotiations and
progressively liberalise trade in services. As per the guidelines and procedures for
the negotiations which were adopted by the Council for Trade in Services as the
basis for continuing the negotiations, the participants shall submit initial offers for
market access by 31 March 2003 before the 5 Ministerial Conference.
A vast number of developing countries had opposed negotiations on the
new issues and industrial tariffs as well as the establishment of a Trade
Negotiations Committee and a single undertaking. This opposition was clear
before and at Doha. And yet, their views were consistently brushed aside and in
the end the countries were pressurised to accept a Declaration that did not reflect
their positions. The WTO Secretariat and the developed countries, to push through
the interests of the latter used a set of manipulative tactics and non-transparent,
undemocratic processes.
A number of NGOs have opposed these on the ground that the new
agreements could close off many development policies and possibilities and result
in unprecedented powers to Multinational Corporations at the expense of peoples
rights and needs. They have opined that The world trading system, and the world
economic system in general, must serve people, especially the poor, and not
continue to be distorted to serve big corporations and an elite minority.
India fought hard for development issues to be placed firmly and explicitly at
the heart of the Doha Development Agenda, and succeeded to some extent. We
have reached a critical time in these negotiations and India needs constructive
engagement and leadership to help guide the Doha Development Agenda towards
a successful conclusion in the 5thth Ministerial Conference that would benefit all
Members.

1 The author is a Senior Lecturer and Co-ordinator (MBA Programme) at the Department of
Business Administration, University of Lucknow 226024 and can be contacted on Phone No: 5222333465 (off.) and 522-2327248 (res.) or E-mail: sanjaymedhavi@hotmail.com

Tourism is regarded as the world's largest industry and one of the fastest
growing, accounting for over one-third of the value of total worldwide services
trade. Highly labour-intensive, it is a major source of employment generation,
especially in remote and rural areas. Tourism is one of the few service sectors that
provide opportunities to all nations, regardless of their level of development.
International tourism has a very substantial impact on trade and foreign
exchange earnings.

For developing countries, it is one area where they run

consistent trade surpluses and is the leading source of foreign exchange in at

least one in three developing countries. Tourism ranks in the top five export
categories for 83 per cent of countries, and employs one in ten workers worldwide,
making it the world's largest employer.
Against this backdrop, the paper presents an overview of the factors
affecting the sustainability and viability of tourism in developing countries and an
analysis of the implications of the WTO GATS negotiations on the economic, social
and environmental sustainability of tourism in the developing countries. The
objective is to chart out a course for Indias constructive engagement and
leadership on tourism and environment issues at WTO thereby insuring increasing
share of developing countries in sustainable international tourism flows.