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Disciplining Services Sector Subsidies: Where Do We Stand and Where Can We (Realistically) Go

Sauvé,Pierre and Marta Soprana (2018), ‘Disciplining Services Sector Subsidies: Where Do We Stand and Where Can We (Realistically) Go?’, Journal of International Economic Law, pp. 599–619.

Abstract

This article explores the (hitherto futile) quest for developing disciplines on the trade- and investment-distorting effects of services subsidies. It sheds light on the multiplicity of factors that have weighed on the conduct of negotiations on subsidy disciplines in a services trade context at both the global and preferential levels, including factor mobility, the preponderance of small- and medium-sized enterprises and the role of state-owned enterprises, and advances a few thoughts on what the future may hold for the adoption of such disciplines. The analysis suggests that World Trade Organization Members appear unlikely to reach a consensus on the matter of subsidy disciplines for services beyond those that currently (and timidly) obtain under the General Agreement on Trade in Services and in many preferential trade agreements. The main reason behind such a conclusion is the marked premium on preserving policy space in a trading environment characterized by significant and rising global market contestability.