Safeguard provisions and international trade agreements involving services*

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Date
1992-05
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Institute of Public Policy studies , Michigan
Abstract
Virtually all bi-or multilateral agreements to liberalize trade contain clauses of various kinds that allow governments to cease to apply their normal obligations under the agreement in order to protect (safeguard) certain overriding interests. Safeguard provisions are often critical to the existence and operation of trade liberalizing agreements, as they function as both insurance mechanisms and safety valves. Adjustment pressures arising from the multiletaral liberalization of trade in services has rarely confronted policymakers, as existing trade agreements have either excluded services or not had much impact on the service sector. However, efforts currently underway in the Uruguay round context, the North American free trade agreement discussions or the enterprise for the American initiative are likely to imply actual liberalization of trade in Services, thus potentially resulting in adjustment pressure and calls for service industries. Two questions are posed: (1) is there a need for such provisions in the services context; and (2) if so, how might they be designed.
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Keywords
safeguard provisions, International trade agreements
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