Services play a major role in all modern economies: an efficient services sector is considered to be crucial for trade and economic growth and for dynamic and resilient economies. Services provide vital support to the economy as a whole and more specifically to industry, for example through finance, logistics and communications. Increased trade in services and the widespread availability of services may boost economic growth by improving the performance of other industries, since services can provide key intermediate inputs, especially in an increasingly interlinked and globalised world.
In this era of increasingly interconnected economies, international trade flows have become more complex, forming global value chains. In this complex setting companies may operate in different countries and have several trading partners all over the world. This is also reflected in the rising importance of trading with services between countries.
The term international trade in services currently covers trade in services as the transactions between residents and non-residents. The services trade data come from the transactions of country's balance of payment, so primarily collected for the purpose of economy ' s balance of payments. Besides being provided through trade in services between residents and non- residents, services may be supplied also through foreign affiliates in host countries. Hence, the wider scope of trading in services adds also the commercial presence of the service suppliers (e.g. the foreign bank creates a subsidiary in a host economy to supply banking services).
The term "services" covers a heterogeneous range of intangible products and activities that are difficult to encapsulate within a simple definition. Services are the result of a production activity that changes the conditions of the consuming units (transformation services) or facilitate the exchange of products or financial assets (margin services). Services are also often difficult to separate from the goods with which they may be associated in varying degrees.