Services trade, especially mode 1 services trade where the buyer remains in the buyer’s country and the seller remains in the seller’s country, is critical to the development of emerging economies. India has been one of the greatest beneficiaries of liberalized trade, but the NYT article below shows that the US is also a clear winner. The full article is worth a read.
For example, will Washington offer tax breaks or other export incentives? While businesses may clamor for them, these would be a setback for freer trade — after all, for years it has been America that has been hectoring other countries to end their subsidies to exporters. Will Washington try to pick winners in the global marketplace, like green energy? More often than not, this kind of industrial policy wastes money, fosters inefficiency and creates few permanent jobs.
So, let’s assume the government does its part to break down barriers and open more foreign markets — what can our businesses themselves do to improve their performance? First, no company should assume that its services can’t be exported. Today’s technologies allow us to do things that were unthinkable just a decade ago. For example, surgeons are using high-speed data connections and robotics to operate on patients thousands of miles away.