./.WORLD TRADE
ORGANIZATIONS/CSS/W/91
26 June 2001
(01-3212)
Council for Trade in Services
Special ServicesOriginal:  English
COMMUNICATION FROM NEW ZEALAND
Negotiating Proposal for Construction and Related Engineering Services1
The attached communication has been received from the delegation of New Zealand with the
request that it be circulated to Members of the Council for Trade in Services.
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A. INTRODUCTION
1. The construction and related engineering services sector constitutes a key sector for all
economies.  It provides the infrastructure for most sectors of industry and, in itself, is both a majoremployer and significantly contributes to the overall GDP of most economies.  In terms of specific
commitments, a little over half of WTO Members have made commitments on construction and
related engineering services to varying degrees.  On average around three to four subsectors are
covered, where commitments have been made, with around a quarter of schedules including full
modes 1-4 commitments.
2. In accordance with the “Negotiating Guidelines and Procedures”
2 as established by the
Council for Trade in Services in Special Session, New Zealand believes that there is sufficient scopefor Members to increase the number and quality of commitments for construction and related
engineering services during the course of the resumed services negotiations.
B. B
ACKGROUND
3. Construction and related engineering services are a vital element of the economic
infrastructure of most economies, as well as being an important part of the economy itself.  For NewZealand, this sector accounts for almost 7 per cent of all those employed and a little under 5 per cent
of New Zealand’s GDP.
4. New Zealand construction firms have worked off-shore since the 1940s, initially in
specialised work involving joint ventures with local partners.  Whilst joint venture and project work
continues to be an important component of activity for New Zealand services suppliers in this sector,some of New Zealand’s services suppliers have begun to establish wholly owned subsidiaries in
                                                     
1 New Zealand reserves the right to submit further and more detailed proposals on this sector at any
time and would note that this proposal has to be read together with New Zealand’s initial objectives for theresumed services negotiations, as contained in S/CSS/W/90 of 26 June 2001.
2 S/L/93 of 29 March 2001 refers.S/CSS/W/91
Page 2
foreign markets, as those markets have progressively liberalised.  This development matches the
experience of many other economies.
5. Given New Zealand’s relative size and geographic isolation, New Zealand’s services
suppliers in the construction and related engineering services sector have tended to focus upon those
areas where New Zealand has a certain comparative advantage.  This has seen New Zealand’sconstruction and related engineering services suppliers develop particular expertise in the design of
earthquake resistant structures, in specialist areas such as hydro and geothermal power station, as well
as dairy and meat plant, design and construction.  It  should also be noted that New Zealand’s services
suppliers in this sector are also usually small and medium-sized enterprises.
C. P
ROPOSAL
6. New Zealand believes that there is sufficient scope for Members to increase the number and
quality of commitments for construction and related engineering services during the course of theresumed services negotiations.  As part of this process, it will be important to ensure that the
negotiations are focussed upon ensuring results that are of clear commercial significance and
relevance to the services suppliers.  New Zealand would therefore place particular emphasis on
exploring ways in which limitations on the type of commercial presence which can be established, as
well as foreign equity limitations, can be removed or diminished.
7. Of course, such a process will need to bear in mind the “Negotiating Guidelines and
Procedures” so as to ensure that these negotiations are an opportunity for all Members to benefit from
further liberalisation, not just a select few.
8. New Zealand would also note that it will be actively exploring ways in which to ensure that
future specific commitments encompass all stages of the construction process ranging from
“pre-erection work at construction sites” (CPC 511) through to “building completion and finishing
work” (CPC 517).  This would ensure that those services suppliers that are engaged in “multi-stage”
construction projects
3  and who are generally small and medium-sized enterprises, obtain the range of
commitments that they require so as to effectively carry out their work.  It would also ensure greater
certainty of access conditions for such services suppliers.
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3 A “multi-stage” construction project exists where a single contractor undertakes all stages of a
construction project from site preparation to final commissioning, either with or without sub-contracting someparts of the work.