Soaring Services Trade: Why Service Trade Barriers Are A Potential Retaliation Tool

2025-03-05 06:00:00 ET

Summary

• While global trade in goods often captures the spotlight, trade in services has been steadily growing, outpacing goods trade.
• However, services trade remains smaller due to non-tariff barriers.
• The US maintains a significant surplus in services, especially with the EU, Canada, and China.
• Retaliation in services may therefore yield better results.

By Ruben Dewitte & Inga Fechner

The steady rise of global services trade: outpacing goods amid 'slowbalisation'

While global trade in goods often captures the spotlight, trade in services has been quietly but steadily achieving remarkable growth. Unlike goods trade, where tangible items cross national borders, trade in services involves the exchange of intangibles between countries. This includes sectors such as tourism, transport, financial services, intellectual property, information and communication technologies (e.g., software development, data processing), as well as online courses, consulting, entertainment, media, and sports events....

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