What do you mean by trade in services?

Trade in services refers to the exchange of intangible products and activities between individuals, businesses, or governments across international borders. Unlike trade in goods, which involves tangible items, trade in services involves transactions where the primary output is a service rather than a physical product. Services encompass a wide range of activities, including professional services, financial services, tourism, telecommunications, education, healthcare, and more.

Key characteristics of trade in services include the absence of a physical presence of goods, the importance of human capital and expertise, and the role of technology in facilitating cross-border transactions. The World Trade Organization (WTO) plays a significant role in regulating and facilitating trade in services through agreements such as the General Agreement on Trade in Services (GATS), which establishes a framework for the liberalization of services trade and the removal of barriers to entry in service markets across countries. Trade in services has become increasingly important in the global economy, reflecting the growing role of the service sector and the interconnectedness of economies in the modern era.