Medical Tourism in Developing Countries

Promoting Medical Tourism ● 129said, “Although privatization of health services and their opening to trade arenot necessarily synonymous, the first has accelerated the second . . ..” 114Why is liberal trade so important? According to Panagariya, “It is toughto find an example of a developing country that has grown rapidly whilemaintaining high trade barriers.” 115 He goes on to say that even thoughIndia and China had protectionist policies in place when they began theirrapid growth, the reason they were able to maintain it was because theyadopted massive liberalization.What are the barriers? To the extent that trade in health services is notprohibited, then tariffs constitute the primary barrier. These may beimposed on trade in goods associated with health (such as pharmaceuticals),or on consumers (such as visa fees and entry taxes). Nontariff barriers totrade include international standards (such as the nonrecognition of licensesfrom abroad), and the need for licensing by the government. With respectto both of these, the authorities may decide to discriminate in favor of localpersons and thus limit trade with foreigners. Other barriers are in the marketingand distribution spheres that form indirect barriers to access.Currency restrictions may limit capital movement while labor and consumermovements may be limited by residency conditions, licensing, workpermits, visas, and entry/exit taxes.Removing these barriers opens countries up for trade that in turn promotesgrowth, because it forces everyone to become more efficient in orderto survive. Thus competition is growth promoting. Moreover, liberalizedtrade in services promotes growth because, as Bhagwati said, it expandsupstream services (product designs, market feasibility studies), and downstreamservices (advertising, marketing, packaging, and transporting). 116As a result, many GATS member countries have committed to liberalizationin trade in services. According to Adlung and Carzaniga, “GATS providesa system of predictable and legally enforceable conditions for trade,and has a potentially positive impact on investment, efficiency andgrowth.” 117 However, with respect to trade in health services specifically, lessthan 40 percent of countries made commitments to liberalize. 118 This numberjumps to 90 percent for tourism services. The following destinationcountries under study have not made any commitments for trade in services:Argentina, Chile, Cuba, Philippines, and Thailand. 119 No country hasput restrictions on buying health services outside their own countries.In other words, of the trade in health services, the category of consumptionabroad (Mode 2) has no limits. Countries have ongoing negotiations withinGATS on the “temporary presence of natural persons,” (namely, Mode4). 120 The more developed countries want to be able to send their workersabroad and the less developed want their multinationals to have greater