Why Trade in Services Statistics are Important in CEFTA Aleksandra Rakovic Technical Expert Workshop on International Trade in Services Statistics EUROSTAT Luxembourg, 2-3 June 2015

Structure of Presentation Implementation of CEFTA Agreement and SEE2020 Strategy Negotiations on Liberalisation of Trade in Services within the CEFTA framework Coordination of Investment Policies and Investment Promotion- [RCC-CEFTA] Recognition of Professional Qualifications [RCC-CEFTA]

Development of CEFTA Structures Joint Committee 2007 2010 - 2014 Deputy Ministers 2015 Committee on Trade Facilitation Secretariat Joint RCC –CEFTA WG on Investment Policy and Promotion Subcommittee on Agriculture and SPS Subcommittee on Trade in Services WG on Electronic Exchange of Information Subcommittee on Customs and RO Negotiating Group on Trade in Services Working Group on Risk Management WG on Trade in Services Statistics Subcommittee on NTBs and TBT Working Group on TBT Joint RCC CEFTA WG on Recognition of Professional Qualifications

Development of priorities CEFTA 2008 - 2013 CEFTA & SEE 2020 2014 - 2020 All commitments and deadlines met Full liberalisation of trade in goods Diagonal cumulation Opening of PP Market TBT notification State Aid notification IPR review Non-discrimination in Investment Transparency tools: Market Access Database, SPS Database, CEFTA Trade Portal Implementation of Agreement focused on Liberalisation of trade in services Trade Facilitation Transparency Synergies within SEE 2020 Investment Market Access Supply chains Mobility Human capital development etc.

SEE2020 Strategy –Flowchart

Overall Strategic Goals Five out of twelve SEE 2020 headline targets are trade and investment related. Increase SEE average GDP per capita relative to the EU average: from 36.4% to 44% in 2020 Boost total SEE trade in goods and services: from EUR 94.4 billion to 209.5 EUR billion in 2020 Reduce SEE trade deficit: from -15.7% (the average in 2008-2010) to -12.3 % of GDP in 2020 (1 million new jobs to be created in the SEE) Overall Strategic Goals Increase SEE intra-regional trade in goods by more than 140% Increase overall annual FDI inflows to the region by at least 160% Integrated Growth Increase GDP per person employed by 32% Add 300,000 highly qualified people to the workforce Smart Growth Increase net enterprise creation (new businesses per year) from 30,107 to 33,760 Increase exports of goods & services per capita from the region from EUR 1,780 to EUR 4,250 Sustainable Growth Increase in the overall employment rate, as a percentage of the 15+ population, from 39.5% to 44.4% Inclusive Growth Improve government’s effectiveness as measured by the World Bank Governance Index from 2.33 to 2.9 by 2020 Governance for Growth

Key Areas of Intervention Integrated Growth Free Trade Area Goods Services Investment Skilled labour Competitive Economic Environment Competition Policy IPR Public Procurement Integration into Global Economy Market Access Participation in Global Supply Networks Capacity Transparency Data availability and quality

Why statistical data are important for? Measuring the impact of globalization (GVC and supply chains analysis) Investment and trade negotiations For policy and decision makers on choosing appropriate negotiating priorities and strategy As a guide to negotiate specific commitments (benchmarks and baselines) Evaluate market access opportunities Assessment of impact of liberalization Background information for disputes Research purposes Private business for impact analysis and new market opportunities

Source: SEE2020Baseline Report

Trade Policy and Facilitation Indicators Total trade in goods and services (billions of USD) Trade balance (% of GDP) Intra-regional trade in goods (billions of USD) SEE trade deficit (% of GDP) Imports/exports of agricultural products Imports/exports of services Services Trade Restrictiveness index

Investment Policy and Promotion Indicators Overall annual FDI inflows as a percentage of GDP Annual investment flows into greenfield investments Value of greenfield projects as a percentage of GDP Foreign direct investment flows Inflows/outflows: equity, reinvested earnings, other capital Foreign direct investment position Inward/outward stocks: equity, reinvested earnings, Equity & reinvested earnings

Subcommittee on Trade in Services Monitor the progress on liberalisation of trade in services Supervise the implementation of Additional Protocol on Trade in Services Promote intra-regional cooperation between regulatory bodies Propose measures for elimination of barriers in trade in services Negotiating Group on Trade in Services Working Group on Trade in Services Statistics Joint RCC-CEFTA WG on Recognition of Professional Qualifications Negotiate the Schedule of Commitments on Trade in Services Conclude the Additional Protocol on Trade in Services Review the quality and coverage of available trade in services statistics Identify priorities for further developing statistics for commonly agreed sectors within CEFTA framework Set up a regular forum for exchange of needs between compilers of data and users Explore potentials for conclusion of mutual recognition of qualifications Enhance transparency of regulative framework Establish a database on the mobility of professionals

Statistics related activities within CEFTA framework (2013-2015) 1. Workshops organized in cooperation and participation from international partners: WTO, UNCTAD, EUROSTAT and OECD 1st Workshop on Trade in Services Statistics in Sarajevo on 8-9 October 2013 general statistical frameworks used in recording and compiling data principles of recording data for services identified as priorities for the region (business, professional, tourism, construction) 2nd Workshop on FATS in Brussels on 9 - 10 December 2014 policy and analytical needs in the context of globalization, supply-chains, trade, investment, services synergies and differences between frameworks on data collection and data compilation interagency cooperation: statistical offices, central banks, ministries dissemination of data, international data sources and analysis 3rd Workshop on FDI to be organized in Sarajevo, October 2015 (UNCTAD) 2. Establishment of the WG on Trade in Services Statistics (first meeting in October 2015)

What are the major challenges faced by key stakeholders? From the compilers point of view how to: develop adequate statistical capacities to measure foreign affiliates activities in particular in services sectors respond to the increased need for additional data ensuring quality and confidentiality of data From users point of view how to: overcome gaps in existing data by setting up minimum requirement of data and using appropriate estimation techniques confidentiality of data, trust and sharing of information amongst stakeholder institutions capacity building in the context of research and analysis for the purposes of trade and investment negotiations Common challenge is how to: Enhance tripartite cooperation (central banks, statistical offices and ministries) Ensure regular exchange of services data to the CEFTA Secretariat Identify appropriate technical assistance to address all these challenges

What type of reporting on BOP Trade in Services, FATS, FDI can be performed? Example of templates/sources to use in reporting to the CEFTA Secretariat: BPM6 data [IMF and EUROSTAT] Trade in services data (details and partner) [UNSD and EUROSTAT] FATS data [EUROSTAT] FDI [UNCTAD] Periodicity: Annually – end of September of a current year Reporting year and timeliness: BPM6 - 2008-2014 FATS - 2011 and 2012 FDI - 2008-2014