RI tables bolder financial services offer at WTO
RI tables bolder financial services offer at WTO
GENEVA (AFP): Indonesia tabled an offer on liberalizing its
banking and insurance industries yesterday, trade officials said,
one day before the cut-off date for a deal on opening the huge
global financial services sector.
Jakarta was the last East Asian hold-out and its revised
package, shown to negotiating parties in private, means that all
the region's economies have come forward with improved market
access offers before the midnight Friday deadline for an
agreement.
The Indonesian bid is a "significant improvement" on its
previous position in banking, and offers 100 percent foreign
ownership of non-bank financial institutions, a European
negotiator said.
Thailand, which handed in its batch of paperwork on Wednesday,
is said to contain full grandfathering (guarantees that existing
shareholdings will be protected in the event of legislated lower
equity ceilings) in banking.
Malaysia is offering a 51 percent maximum foreign shareholding
in local insurance companies, far below U.S. demands but higher
than its current 30 percent legal limit.
Bolder liberalization commitments from Asia's "tiger"
economies is a key condition of U.S. approval of a World Trade
Organization pact that, if sealed, would come into force in 1999.
Two years ago, when Washington refused to sign its name to a
pact, it blamed weak offers from Southeast Asian and Latin
American nations.
A U.S. industry source in Geneva close to the talks said, "I
am optimistic. We have made very good progress over the last
days."
Grandfathering is "an important problem" and Malaysia has a
"difficult offer" the source said. "But it's very unlikely this
will compromise the talks."
About 10 U.S. insurance companies are satisfied with the
offers in hand, though the situation is a little less clear with
respect to consensus on banking.
In Latin America, Brazil turned in a long-awaited revised
offer this week, which includes a major opening in reinsurance.
Negotiators are still waiting for a gesture from Colombia.
Some 49 offers from 63 countries (including the European Union
as 15 separate members) have arrived in the last eight months.
Altogether, close to 100 countries made some kind of
commitment to open their banking, insurance and asset management
sectors to greater foreign competition.
The United States, the EU and Japan together account for well
over 90 percent of the global financial services business, and
their firms, facing severe competition at home, are eager to
expand overseas.
European Commission vice president Sir Leon Brittan said on
Thursday negotiators are close to striking a deal on
liberalization of global financial services.
"We have not yet got there but we are poised to get that
deal," Brittan told journalists.
An agreement in the World Trade Organization negotiations was
"attainable" by the deadline of midnight on Friday, said Brittan,
adding the EU was working "flat out" to hammer out a pact and had
made slight revisions to its own already liberal offer as a
contribution to the final effort.
Asked exactly how close the 132 WTO members were to reaching
agreement, he said "the apple is ripening rapidly on the tree. It
needs just a touch more sun to fall into our lap."
A U.S. industry source in Geneva close to the talks said he
was "optimistic" that an agreement would be sealed by the Friday
deadline.
"We have made very good progress over the last days," the
source said, adding some 10 insurance companies were satisfied
with the offers in hand.