This paper uses a structural gravity model to show the effects of services policies on manufacturing exports. Whereas the previous literature has focused on indirect effects of policies - flowing through productivity effects in domestic services markets - we look at direct effects, namely the ability of domestic manufacturers to access services inputs on world markets at competitive prices. Our results show that discriminatory barriers to services trade have a significant negative effect on manufacturing exports. We use theory-consistent counterfactual simulations to show that the trade and real output effects of a 10% reduction in services trade restrictiveness are in fact much larger than those of a 10% reduction in tariffs. On a policy level, our results suggest that an additional argument for liberalizing services markets is that it in fact aids manufacturing sector development, due to the intimate links between the two.