International Trade in Services.pdf - DSpace at Khazar University

Health without Borders 103
What may one expect from increased trade
in health services
The impact of trade on the health systems of countries may vary considerably
depending on the mode of service delivery, the structure of the domestic market
for the provision of health services, and the adequacy of the accompanying regulations
and policies. At the same time, trade in health services may create opportunities
and have a number of benefits not only for the business partners involved
in trade, but for the population as a whole. However, there could also potentially
be cost and other negative effects. Hereafter is a review of these effects and suggested
solutions—on the basis of country case studies—to maximize the positive
and minimize the negative spillover effects of trade. It is stressed that there is a
common tendency to protect the domestic market against imports that could
prove particularly damaging in the health sector. The point is that imports are as
important as exports, if not more important. Given that the four modes of service
delivery are intertwined, the attempt at protection could prove vain. For example,
a country that does not allow foreign investment in the health sector or does not
allow foreign doctors to practice locally might be able to limit its imports under
Modes 3 and 4. But this policy is likely to result in higher imports under Mode 2
because a number of nationals will seek treatment abroad to access a certain quality
of care (technologies and internationally known doctors). This scenario would
create further inequalities in access to health care, and money spent on health care
abroad would never benefit the domestic system, unlike, potentially, foreign
investment or a domestic practice by a foreign doctor.
The discussion analyzes the impact of trade from the perspective of the
importing and exporting parties, underlining potential threats and opportunities
as well as ways to minimize the former and maximize the latter. Table 4.2 distinguishes
exporters and importers of health services by mode of provision.
The Import Side: Using Trade to Improve
Domestic Access to Quality Health Services
Most countries, particularly, but not exclusively those in the South, suffer from
shortages in the health sector (human or capital). Increasing imports through foreign
direct investment (FDI) or other channels could contribute to remedying
these shortages, although it could present some challenges for countries in which
private participation in the provision of health services has been deliberately
limited. In this context, the regulatory environment and the respective roles of the
public and private sectors, especially, are key determinants of trade policy choices,
trade opening effects, and the accompanying measures to be taken.