I. Introduction
Liberalization of merchandize trade has brought forth extraordinary gains to global
economy over the course of last few decades[1]. Recent research findings, however,
suggest that liberalization of services trade promises even greater benefits to the world
economy[2]. Although services trade has been growing more rapidly than merchandize
trade since the 1980s, currently only about 20 percent of services are traded globally
despite this sector accounts more than half of global GDP and exceeds 75 percent of
GDP in high-income countries (UNCTAD, 2012)[3]. Cross-border temporary movement
of natural persons as service suppliers – as envisaged by Mode 4 of the General
Agreement on Trade in Services (GATS) of the World Trade Organization (WTO) –
also promises significant gains for the world economy. Currently, however,
cross-border labor mobility remains mired in a complex quagmire of domestic as
well as international trade restrictions and other non-trade barriers in both developed
and developing countries. Based on an assessment of the patterns of remittances flows
across the world and the economic rationale for liberalization of temporary movement
of natural persons as service suppliers across borders, this paper argues that given
rising anti-immigrant sentiments in the developed countries and the Doha Round’s
abysmal failure in liberalizing this sector, regional trading agreements (RTAs) may
provide a credible interim vehicle for furthering liberalization of this sector.