The General Agreement on Trade in Services and the Impact of Trade Liberalisation on Tourism and Sustainability

Abstract

After years of protracted negotiation the General Agreement on Trade in Services (GATS) was due to come into force at the end of 2002. This agreement, the first multilateral and legally enforceable liberalisation agreement covering trade in services, including tourism services, aims to eliminate obstacles and discriminatory barriers to service trade and increase markets for investment. The agreement, covering a range of sectors, promises to have a significant effect on tourism service provision and perhaps pose a significant challenge to the efforts to develop sustainable forms of tourism. The subject of considerable controversy, the GATS has been criticised by human rights, environmental and developing world activist groups, many of whom see it as nothing more than a front for corporate domination of global markets, accelerating environmental degradation and undermining local governance structures. Supporters, on the other hand, see the GATS potential in overcoming trade disputes and hold out the promise of regional development and employment through increased inward investment. This paper aims to outline the GATS, examine its legal principles and explain the enthusiasm of its supporters and the concerns of the critics. Furthermore, it considers the potential impact of the GATS on sustainability and on issues such as local community participation and tourism governance.