Tapping Into Global Value Chains Through Services

9 July 2013
press release

Geneva — A session on services and global value chains for Least Developed Countries at the ongoing Fourth Global Review of Aid for Trade has underscored that in spite of being overlooked, "services represent one of the most vibrant segments of world trade, and contribute to over half of the world value-added."

Panelists from the Economic Commission for Africa (ECA) and the World Trade Organization (WTO) stated that there is scope for the services sector to contribute to the structural transformation of LDCs' economies. This sector, they stressed, plays a key role in linking LDCs into regional and Global value chains.

Speakers highlighted that services often exert positive spillovers on productivity levels in many other sectors.

"A notable example of this is the adoption of Information and Communication Technologies and the boom in ICT-related services, which resulted in a sharp boost to industrial productivity levels," they said.

In his intervention, a senior official from the ECA highlighted the various obstacles that still significantly hamper trade in services in the African context, and argued that this could potentially have harmful effects on other activities as well.

The panel discussed examples of vibrant trade services in the African context, which include tourism; educational services in Uganda; ICT services in Senegal; Kenya's progress with mobile banking; and Rwanda's experience with conference services.

The session also highlighted that the restrictions to trade in services often complicate other supply-side constraints, such as the lack of adequately skilled domestic suppliers, or the underdevelopment of financial services.

Panelists insisted that in a context of regional integration, openness in trade services would allow the LDCs to benefit. The benefits would also extend to non-LDCs as a result of the opportunities presented in an expanded regional African market.

They also noted that Aid for Trade has the potential to complement the efforts of African countries and help to bridge gaps in infrastructure. "More importantly, LDCs are likely to have further growth in the services sector if there is increased infrastructure development," they said.

Issued by:

ECA External Communications and Media Relations Section

PO Box 3001

Addis Ababa

Ethiopia

Tel: +251 11 551 5826

E-mail: ecainfo[at]uneca[dot]org

www.uneca.org

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