General Agreement on Trade in Services

Construction and related engineering services

2457

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Description of the sector (1)

General construction work for buildings (CPC 512) New work, additions and renovation work for all types of

buildings, residential or non-residential, whether privately or publicly owned

General construction work for civil engineering (CPC 513) Construction work for structures other than buildings, such

as highways and streets, railways and airfield runways, bridges and tunnels, waterways and harbours, pipelines, communication and power lines, mining and manufacturing plants, and stadia and sports grounds

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Description of the sector (2)

Installation and assembly work (CPC 514 and 516) Assembly and erection of prefabricated constructions,

installation work for heating and air conditioning, water plumbing, gas fitting, electrical wiring, fire alarm construction, insulation and lift construction

Building completion and finishing work (CPC 517) Special trade construction work for the completion and

finishing of buildings (glazing, painting, tiling, carpentry and decoration)

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Description of the sector (3)

Other (CPC 511, 515 and 518) Pre-erection work and special work

(foundation work, water well drilling, roofing, concrete work, etc.)

Renting services related to equipment for construction or demolition of buildings

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Importance of the sector

Dual role provides the infrastructure for all other

industries constitutes one of the largest single

sectors of the economyMajor source of employmentClose links to public works

role of government procurement

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Features of the sector (1)

Firms range in size and level of specialisation importance of local operators

Services are supplied internationally => large-scale projects

airports, harbours, etc.

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Features of the sector (2)

Sector is subject to different aspects of domestic regulation Objectives: safety, urban planning,

public interestA range of levels of skill is required

skilled and unskilled labour

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Construction and development

Liberalisation of construction services can promote: Development of basic infrastructure Training of local personnel Transfer of technical knowledge

Competitive advantages of developing countries in this sector

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Specific commitments

71 Members made specific commitments in this sector: Buildings ⇒ 62 Civil engineering ⇒ 63 Installation and assembly ⇒ 61 Completion and finishing ⇒ 53 Other ⇒ 46

Few MFN exemptions

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Specific Commitments

WHAT ABOUT EGYPT?

Egypt has substantial commitments in civil engineering

And one General MFN exemption applicable to construction

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Sector or Sub-sector Limitations on Market Access

Limitations on National Treatment

Additional Commitments

B. Construction Work for Civil Engineering

- Bridges, elevated highways, tunnels and subways

- Waterways, harbours, dams and other water work

- Long distance pipelines, communication and power lines (cables)

- Construction for mining and manufacturing

1) Unbound2) Unbound3)- Commercial presence is only allowed for joint-venture companies

- Foreign capital equity shall not exceed 49 per cent of the total capital required for the project

4) None

1) Unbound*2) Unbound*3) None

Egypt’s Commitments

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Egypt’s Commitments

Sector or Sub-sector Limitations on Market Access

Limitations on National Treatment

Additional Commitments

Special Trade Construction Work:- Steel bending and erection (including welding)- Other special trade construction workInstallation Work:- Gas fitting construction work- Other electrical construction work- Other installation work- Lift and escalator construction work- Renting services related to equipment for construction or demolition of buildings or civil engineering works, with operator

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MFN Exemption

Sector or Subsector

Description of measure indicating its inconsistency

with Article II

Countries to which the

measure applies

Intended duration

Conditions creating the need for the exemption

ALL SECTORS Full national treatment is extended to foreign personnel of the countries indicated in column 3

GreeceIraqJordanLibyaQatarSudanUnited Arab EmiratesYemen and possibly: other countries

This measure shall be maintained as long as the agreements referred to in column 2 remain in force or are extended

To ensure opening of the markets in the countries referred to in column 3, as the major trading partners do not accord the Egyptian nationals satisfactory opportunities.

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Modes of supply

Commercial presence importance of local presence limited or unlimited duration

Movement of natural persons skilled and unskilled labour

Cross-border supply not technically feasible, except in the

design phase however, technological advances...

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Most common limitations

Limitations in mode 3 type of legal entity; participation of

foreign capital; transfer of fundsLimitations in mode 4

nationality and residency requirements; recognition of qualifications

Horizontal limitations subsidies, land acquisition

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8 negotiating proposals

European Communities

AustraliaJapanKorea

ChileNew ZealandBrazilKenyaCuba

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Main issues

Increase the number and quality of specific commitments

Emphasis on mode 3 restrictions Facilitate the movement of natural personsImprove mutual recognition

implement Article VII of the GATSAddress the issue of subsidiesIncreasing participation of developing countries

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Main issues

Subsectors are interrelated need for specific commitments in each

and every oneCase of “multi-stage construction

projects” “turnkey” plants

Attention should, however, be paid to national specializations

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Ongoing Negotiations

Out of 40 offers received, 12 mention construction

No Egyptian offer yet