The volume of international trade in services

The volume of international trade in services

The volume of international trade in services

The low volume of trade in services compared with merchandise

may seem surprising, given that most jobs in OECD economies and

many other countries are now in (services), and services account for

50 OECD Insights: International Trade

70% of the total value-added in the economies of OECD countries.

Yet for OECD countries overall, service exports in 2006 accounted

for around 22% of total (exports), for a value of $2.1 trillion (75% of

total world services exports) compared with $7.5 trillion for OECD

goods exports.

Service imports to OECD) countries in 2006 accounted for 19% of)

the total imports, worth $1.9 trillion (70% of total world services

imports) and OECD imports of goods were worth $8.2 trillion.

Why is there less trade in services than in goods internationally?

For a start, many services have to be consumed at the point

of production – hotel rooms or office cleaning, for instance.

Companies may provide these services abroad, and although this

is (trade) as defined by mode 3 (“commercial presence”) the value

of such business would not show up in balance of payments data

since these only show cross-border trade. This type of trade is

growing as new domains, such as education, health and municipal

services like waste management, are opened up to international

competition.