International trade in services refers to the exchange of services between entities of different countries. Unlike goods trade, in which physical goods are transferred across borders, trade in services comprises intangible services such as financial services, tourism, transport, information technology and consultancy. The importance of international trade in services has increased considerably in recent decades, owing to globalisation, technological progress and market liberalisation.
One key aspect of international trade in services is its role in the global economy. Services contribute significantly to the gross domestic product (GDP) of many countries and are an important factor in economic growth and development. They promote efficiency and productivity by enabling enterprises to use specialised services that may not be available internally. In addition, services help to create jobs and improve quality of life.
The Sixth Edition of the International Monetary Fund’s Balance of Payments and International Investment Position Manual (BPM6) and the Manual on Statistics of International Trade in Services (MSITS 2010) provide comprehensive frameworks for recording and analysing trade in services. BPM6 defines trade in services as being part of the current account, which encompasses not only flows of services but also flows of goods, primary income and secondary income. Services are divided into different categories, including transport, travel, construction, insurance and pension services, financial services, use of intellectual property, telecommunications, computer and information services, other business services, personal, cultural and recreational services, and government services.
The MSITS 2010 complements BPM6 by providing detailed guidance on the collection and reporting of data on international trade in services. It stresses the importance of accurately recording services provided through different modes: cross-border trade, consumption abroad, commercial presence and the presence of natural persons. These modes help to understand and analyse the complexity of trade in services.
