COMCEC Trade Outlook 2019
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4. TRADE IN COMMERCIAL SERVICES
Trade in services refers to trade of intangible products (services) between producers and
consumers. It covers many sectors including transport, travel, construction, telecommunication
and information services, intellectual property related services etc. In this report, only the
commercial services will be analyzed in line with the classification of UNCTAD. According to the
UNCTADSTAT, “commercial services cover all service categories, except trade in government
goods and services ”17.
Trade in services plays very significant role in the global economy for economic growth and
development of the countries. It contributes to generating employment and investment and
have increasing importance in global international trade. Moreover, according to the World
Bank, the growth in the services sector contributes to reduce poverty much more than the
growth of agricultural and manufacturing sectors18.
4.1. Trends in Global Trade in Commercial Services
The contribution of services sector to GDP has been increasing in the recent decades. According
to the data from UNCTADSTAT, the share of services sector in total global GDP increased from
59.8 per cent in 1990, to 64 percent in 2017. On the other hand, the contribution of services
sector to GDP is higher in developed countries compared to developing countries. In 2015, the
share of services sector in the GDP of developed countries was 72.3 per cent, whereas the same
ratio was 53.1 per cent in the developing countries. However, in both group of countries, the
share of services trade in GDP was on an upward trend between 1990-2016.
Figure 34: Share of Services Sector in Total GDP
Source: UNCTADSTAT
According to WTO19 as one of the most dynamic segments in the world trade, trade in services
increases its importance in the global economy. In the last few decades, the volume of trade in
services has increased more than the volume of merchandise trade in the world. As
demonstrated in the Figure 35 below, annual average growth of global goods exports between
2006 and 2018 was 4.13 per cent, while the global commercial services exports grew by 5.80
17 UNCTADSTAT.
18 World Bank presentation, "Role of Services in Economic Development"; Geneva, July 2012
19 WTO
59.9
62.5
64.5 64.5 63.3 64.3 64.2
47.4
50.7 51.0 49.6 49.5
53.1 52.8
63.5
65.9
68.6 69.7
71.1 72.3 72.5
45
50
55
60
65
70
75
1990 1995 2000 2005 2010 2015 2017
World Developing economies Developed economies