Legal Framework for Cross-Regional Networks: The Case of Services and Migration

Paper prepared by Marion Panizzon and Charlotte Sieber-Gasser for the International Conference on the Political Economy of Liberalising Trade in Services, Hebrew University of Jerusalem, 14-15 June 2010 Recent literature has shed light on the economic potential of cross-border networks. These networks, consisting of expatriates and their acquaintances from abroad and at home, provide the basis for the creation of cross-border value added chains and therewith the means for turning brain drain into brain circulation. Both aspects are potentially valuable for economic growth in the developing world. Unilateral co-development policies operating through co-funding of expatriate business ventures, but also bilateral agreements liberalising circular migration for a limited set of per-sons testify to the increasing awareness of governments about the potential, which expatriate networks hold for economic growth in developing countries. Whereas such punctual efforts are valuable, viewed from a long term perspective, these top-down, government mandated Diaspora stimulation programs, will not replace, this paper argues, the market-driven liberalisation of infrastructure and other services in developing countries. Nor will they carry, in the case of circular labour migration, the political momentum to liberalise labour market admission for those non-nationals, who will eventually emerge as the future transnational entrepreneurs. It will take a combination of mode 4 and infrastructure services openings-cum regulation for countries at both sides of the spectrum to provide the basis and precondition for transnational business and entrepreneurial networks to emerge and translate into cross-border, value added production chains. Two key issues are of particular relevance in this context: (i) the services sector, especially in infrastructure, tends to suffer from inefficiencies, particularly in developing countries, and (ii) labour migration, a highly complex issue, still faces disproportionately rigid barriers despite well-documented global welfare gains. Both are hindrances for emerging markets to fully take advantage of the potential of these cross-border networks. Adapting the legal framework for enhancing the regulatory and institutional frameworks for services trade, especially in infrastructure services sectors (ISS) and labour migration could provide the incentives necessary for brain circulation and strengthen cross-border value added chains by lowering transaction costs. This paper analyses the shortfalls of the global legal framework – the shallow status quo of GATS commitments in ISS and mode 4 particular – in relation to stimulating brain circulation and the creation of cross-border value added chains in emerging markets. It highlights the necessity of adapting the legal framework, both on the global and the regional level, to stimulate broader and wider market access in the four key ISS sectors (telecommunications, transport, professional and financial services) in developing countries, as domestic supply capacity, global competitiveness and economic diversification in ISS sectors are necessary for mobilising expatriate re-turns, both physical and virtual. The paper argues that industrialised, labour receiving countries need to offer mode 4 market access to wider categories of persons, especially to students, graduate trainees and young professionals from abroad. Further-more, free trade in semi-finished products and mode 4 market access are crucial for the creation of cross-border value added chains across the developing world. Finally, the paper discusses on the basis of a case study on Jordan why the key features of trade agreements, which promote circular migration and the creation of cross-border value added chains, consist of trade liberalisation in services and liberal migration policies.

Legal Integration of Islam: A Transatlantic Comparison

The status of Islam in Western societies remains deeply contentious. Countering strident claims on both the right and left, Legal Integration of Islam offers an empirically informed analysis of how four liberal democracies—France, Germany, Canada, and the United States—have responded to the challenge of integrating Islam and Muslim populations. Demonstrating the centrality of the legal system to this process, Christian Joppke and John Torpey reject the widely held notion that Europe is incapable of accommodating Islam and argue that institutional barriers to Muslim integration are no greater on one side of the Atlantic than the other. While Muslims have achieved a substantial degree of equality working through the courts, political dynamics increasingly push back against these gains, particularly in Europe. From a classical liberal viewpoint, religion can either be driven out of public space, as in France, or included without sectarian preference, as in Germany. But both policies come at a price—religious liberty in France and full equality in Germany. Often seen as the flagship of multiculturalism, Canada has found itself responding to nativist and liberal pressures as Muslims become more assertive. And although there have been outbursts of anti-Islamic sentiment in the United States, the legal and political recognition of Islam is well established and largely uncontested. Legal Integration of Islam brings to light the successes and the shortcomings of integrating Islam through law without denying the challenges that this religion presents for liberal societies.

Low-Income Developing Countries and WTO Litigation: Why Wake Up the Sleeping Dog?

The World Trade Organization (WTO) is one of the most judicialized dispute settlement systems in international politics. While a general appreciation has developed that the system has worked quite well, research has not paid sufficient attention to the weakest actors in the system. This paper addresses the puzzle of missing cases of least-developed countries initiating WTO disputes settlement procedures. It challenges the existing literature on developing countries in WTO dispute settlement which predominantly focuses on legal capacity and economic interests. The paper provides an argument that the small universe of ‘actionable cases’, the option of free riding and the assessment of the perceived opportunity costs related to other foreign policy priorities better explain the absence of cases. In addition (and somewhat counterintuitively), we argue that the absence of cases is not necessarily bad news and shows how the weakest actors can use the dispute settlement system in a ‘lighter version’ or in indirect ways. The argument is empirically assessed by conducting a case study on four West African cotton-producing countries (C4) and their involvement in dispute settlement.

The Global Digital Divide as Impeded Access to Content

The paper seeks a re-conceptualization of the global digital divide debate. It critically explores the predominant notion, its evolution and measurement, as well as the policies that have been advanced to bridge the digital divide. Acknowledging the complexity of this inequality, the paper aims at analyzing the disparities beyond the connectivity and the skills barriers. Without understating the first two digital divides, it is argued that as the Internet becomes more sophisticated and more integrated into economic, social and cultural processes, a ‘third’ generation of divides becomes critical. These divides are drawn not at the entry to the net but within the net itself, and limit access to content. The increasing barriers to content, although of diverse nature, all relate to some governance characteristics inherent in cyberspace, such as global spillover of local decisions, regulation through code or proliferation of self- and co-regulatory models. It is maintained that as the practice of intervention intensifies in cyberspace, multiple and far-reaching points of control outside formal legal institutions are created, which threaten the availability of public goods and make the pursuit of public objectives difficult. This is an aspect that is rarely addressed in the global digital divide discussions, even in comprehensive analysis and political initiatives such as the World Summit on the Information Society. Yet, the conceptualization of the digital divide as impeded access to content may be key in terms of ensuring real participation and catering for the long-term implications of digital technologies.

Re-Conceptualizing the Global Digital Divide

The article seeks a re-conceptualization of the global digital divide debate. It critically explores the predominant notion, its evolution and measurement, as well as the policies that have been advanced to bridge the digital divide. Acknowledging the complexity of this inequality, the article aims at analyzing the disparities beyond the connectivity and skills barriers. Without understating the first two digital divides, it is argued that as the Internet becomes more sophisticated and more integrated into economic, social, and cultural processes, a “third” generation of divides becomes critical. These divides are drawn not at the entry to the net but within the net itself, and limit access to content. The increasing barriers to content, though of a diverse nature, all relate to some governance characteristics inherent in cyberspace, such as global spillover of local decisions, regulation through code, and proliferation of self- and co-regulatory models. It is maintained that as the practice of intervention intensifies in cyberspace, multiple and far-reaching points of control outside formal legal institutions are created, threatening the availability of public goods and making the pursuit of public objectives difficult. This is an aspect that is rarely addressed in the global digital divide discussions, even in comprehensive analyses and political initiatives such as the World Summit on the Information Society. Yet, the conceptualization of the digital divide as impeded access to content may be key in terms of ensuring real participation and catering for the long-term implications of digital technologies.