This report highlights the key outcomes of the 2023 OECD Services Trade Restrictiveness Index (STRI). The OECD’s quantification of services regimes across countries and over time seeks to inform the decisions of policy makers and regulators, to convey transparent and accessible information to exporters, and to provide a source of data for academic research on drivers and impediments to services trade.

• The supply of services through commercial presence and digital trade are facing headwinds, as global services providers are confronted by fragmented regulatory environments. The OECD’s annual measurement of services trade restrictions identifies new barriers in 2023 that affect foreign investment and operations across services sectors. These include new or revised policies across several countries related to the screening of foreign direct investment affecting services sectors such as computer services, telecommunications, transport, and commercial banking. Moreover, tightening rules on digital trade and foreign e-commerce platforms add to the challenges faced by global services providers.

• Improved market conditions for infrastructure services. New policies in 2023 contributed to easing regulatory hurdles in some countries. The liberalisation of infrastructure-related services such as construction, architecture, and engineering services is particularly noteworthy (e.g. with liberalising policies in Canada and the People’s Republic of China, among others). Other examples are more sector specific affecting for instance financial services (e.g. easing conditions for foreigners to buy shares in local banks in Brazil), professional services (e.g. facilitating market access to foreign lawyers in India), digitally enabled services (e.g. amending rules on data protection in Korea and enacting a new Digital Personal Data Protection Act in India) and the reduction of government involvement in key enterprises in some countries (e.g. Israel, Lithuania and the United Kingdom). The overall number of policy reforms identified in 2023 was fewer than in 2022, but aggregate liberalising policies outweighed the introduction of new restrictions.

• Japan, Spain and the United Kingdom were top ranked performers as countries with the lowest average regulatory barriers to services trade in 2023. China, Korea, and Portugal were the economies with the highest degree of liberalising reform.

• National and collective efforts required to advance services liberalisation, benefit exporters, lower trade costs and enhance productivity. OECD estimates show that trade costs could decline by 20% to 37% for providers of commercial banking services – a key intermediate service across the economy – if countries were to pursue ambitious reforms. Moreover, lowering trade barriers in upstream services sectors can have a positive effect on economic performance along the global supply chain. For instance, ambitious reforms in air transport – the most restrictive sector across countries – could increase downstream manufacturing productivity by 8.4% on average across 17 manufacturing industries. Recognising the benefits of open services markets and a rules-based international trading system, more national and multilateral actions are needed to further accelerate the liberalisation of services trade policies to counterbalance the volume of barriers accumulated over the past years.