U.S. optimistic on financial services accord<\/p>\n
JAKARTA (JP): A senior United States Treasury official told a
\ngroup of panelists here yesterday that he is confident a global
\nfinancial service deal will be concluded by June 30 despite the
\nrecent Mexican crisis and the falling dollar.<\/p>\n
\"I do not believe that Mexico's financial problems should be a
\nreason for countries to hold back on reaching an agreement on the
\nopening of financial services,\" said Jefferey Schafer, addressing
\na group of panelists about the trade of financial services set up
\nunder the new World Trade Organization.<\/p>\n
The panel talk was held by Worldnet and the United States
\nInformation Service at the U.S. embassy here yesterday.<\/p>\n
The area of financial services -- including banking and
\ninsurance -- was set aside at the end of the seven-year Uruguay
\nRound negotiations last year.<\/p>\n
Last month the United States pledged to give equal treatment
\nto all signatories on the General Agreement on Tariffs and Trade
\nprovided they make substantial commitments to opening up their
\nfinancial services sector to outside competition.<\/p>\n
Looking back at the Mexican crisis in January, Schafer
\nsuggested that the Mexico could have avoided the problem had
\nthere been a greater presence of foreign banks injecting more
\ncapital into the economy.<\/p>\n
\"Remember, the goal of this accord is to create a strong
\nnetwork of global financial institutions,\" he said.<\/p>\n
Currency<\/p>\n
The official, however, refused to discuss the impact that the
\nslipping U.S. currency against the Japanese yen and German
\nDeutsche mark might have on reaching the accord by its deadline
\nof June 30.<\/p>\n
Market reports from London and Tokyo yesterday said that the
\ndollar steadied nervously in European trade after plunging to a
\nnew post-war low against the yen in the Far East.<\/p>\n
Dollar buying by the U.S. Federal Reserve, the German
\nBundesbank and the Bank of Japan earlier this week proved largely
\nineffective.<\/p>\n
The dollar was trading at around 84 yen in mid-morning, above
\na fresh 83.65 yen low seen overnight. Against the mark it climbed
\nto 1.3770 from 1.3730 late on Thursday.<\/p>\n
\"I could repeat what Treasury Secretary Robert Rubin said
\nrecently: a strong dollar will benefit the U.S. economy and the
\nTreasury will only intervene if it makes sense,\" he said.<\/p>\n
Schafer also said that once the June 30 deadline is passed,
\nthe U.S. will be \"interested\" in setting further deadlines to
\nimplement concrete measures to open the trade of financial
\nservices.<\/p>\n
Such datelines, he said, would be \"negotiable and discussed on
\na country by country basis as long as there is a clear commitment
\nin opening up markets.\"<\/p>\n
One example of U.S. concern with Indonesia's commitment to a
\nmore open sector is the regulation that requires foreign banks to
\nhave higher capital than domestic banks, he said.<\/p>\n
\"Sure it does not keep everybody out but it is a concern,\" he
\nsaid.<\/p>\n
Three leading U.S. investment banks deciding recently to
\nestablish a presence here are Salomon Brothers, Goldman Sachs and
\nMerrill Lynch. (hdj)<\/p>",
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