Free Movement of natural persons: North-South Conflicts of Economic Interests

Abstract

The establishment of the General Agreement on Trade in Service (GATS) is one of the major achievements of the Uruguay Round of trade negotiations. All the trades in services fall within the GATS through four modes of delivery under Article I:2 of GATS. Among the modes, the liberalization of mode 4: Movement of Natural Persons which relates the removal of restrictions on workers travelling abroad temporarily, upon which developing countries have comparative advantage, remains one of the least negotiated issues of the WTO, while the other 3 modes upon which the developed countries have dominance have been liberalized substantially. This study elucidates some logical arguments that mode 4 is the victim of the North-South conflict of economic interests. Besides, this study furnishes arguments how liberalization of mode 4 can be economically beneficial for both North and South. The structural weakness in Articles, Schedules and Annexes of GATS entailing mode 4 needs to be restructured so that developing countries are able to participate meaningfully in the world trade in services and see their economic interests are protected equitably with the developed countries so that the economic interests of both developed and developing countries in trade in services can become mutually supportive.