Malaysia puts in offer for services liberalization<\/p>\n
GENEVA (AFP): Malaysia has submitted a long awaited improved
\noffer on financial services liberalization, trade officials said
\nahead of a key negotiating meeting yesterday aimed at forging a
\nglobal deal.<\/p>\n
Indonesia, the Philippines and Brazil, other key players in
\nthe talks, have not yet followed suit.<\/p>\n
But the hope is that they will act at the World Trade
\nOrganization's Committee on Financial Services meeting which
\nbrings together high-level negotiators, a source close to the
\nnegotiations said.<\/p>\n
The Wednesday session, following two days of bilateral talks
\nhere, should provide clues as to whether representatives from 97
\ncountries can meet a Dec. 12 deadline for wrapping up an
\nagreement on financial services, which covers the multi-trillion-
\ndollar markets of banking, insurance and asset management.<\/p>\n
The Malaysian proposal, circulated at bilateral talks, has
\nleft some insiders unimpressed.<\/p>\n
\"It is a bit disappointing,\" said a trade official who has
\nseen the document. \"It does not allow foreign firms to have
\ncontrol over their activities in the banking sector.\"<\/p>\n
However, the proposal does permit new foreign majority
\nshareholdings in the domestic insurance sector, an improvement
\nfrom Kuala Lumpur's previous stance.<\/p>\n
The official said the offer \"is not the final version. We still
\nhave one month\".<\/p>\n
Attention in the last few months has focussed on emerging
\neconomies in Southeast Asia, which are submerged in an economic
\ncrisis that has taken them, and their Western trading partners,
\nby surprise.<\/p>\n
Commitments from the so-called Tiger economies (as well as
\nlarge Latin American countries), in the shape of concrete
\nconcessions, are seen as vital to winning U.S. approval for an
\nagreement.<\/p>\n
Washington walked away from a global liberalization pact in
\n1995, blaming the paucity of attractive proposals from these
\ncountries as justification for its refusal to offer
\nmost-favored-nation (MFN) treatment to all foreigners.<\/p>\n
MFN applies the principle of non-discrimination to all
\npartners. The United States wants binding commitments allowing
\nits bankers and insurers to set up majority-owned branches
\noverseas. It also wants guarantees that majority ownership rules
\nfor firms that have already made investments will be honored in
\nthe event of changes in a country's financial services
\nlegislative landscape.<\/p>\n
Observers say East Asia's financial troubles have spawned a
\nrealization in regional trade ministries that a WTO agreement
\nwould boost confidence among foreign investors looking for
\ngovernments to shore up financial regulatory mechanisms.<\/p>\n
\"This feeling is shared by the (Southeast Asian) negotiators.
\nThey are trying hard. The will is there (to further liberalize),
\nbut it's a question of tactics,\" the source said, adding that \"we
\nneed to keep on encouraging developing countries.\"<\/p>\n
Thailand said it would try its best to put in a better market
\naccess package in November, although not much is expected, given
\nthe country's particularly severe economic problems and recent
\npolitical upheavals.<\/p>\n
The trade official acknowledged that \"at the end of the day,
\nwe might have to talk about phased-in market opening offers\" from
\ncertain Asian countries.<\/p>\n
At the start of this week, 30 improved offers had been tabled
\nby 44 countries (counting the European Union as 15) since
\nnegotiations resumed in April. Singapore, Hong Kong and South
\nKorea fall into this category. The latest to jump on the
\nbandwagon are South Africa, Israel, Tunisia, Costa Rica, Uruguay
\nand Peru.<\/p>\n
The negotiations sprang out of commitments originally made at
\nthe end of the Uruguay Round of trade talks in 1993 (under the
\nWTO's predecessor, the General Agreement on Tariffs and Trade)
\nwhen 82 governments made offers to open up their markets to
\nforeign financial service providers.<\/p>\n
The stakes for a deal are enormous. Daily foreign exchange
\ntransactions are estimated to top US$1.2 trillion.<\/p>\n
Total world banking assets are put at $20 trillion, insurance
\npremiums at $2 trillion and the market value of listed bonds at
\n$10 trillion.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/malaysia-puts-in-offer-for-services-liberalization-1447893297",
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