Joint Statement by U.S. Trade Representative Charlene Barshefsky and Treasure Secretary Robert Rubin on the U.S. Offer in the WTO Financial Services Negotiations

PR9741E | Date: 1997-07-21

On July 14, the United States submitted a new and comprehensive MFN-based offer, on a conditional basis, to our trading partners in the WTO Financial Services Negotiations. We are proposing to bind in the WTO substantially full market access and national treatment to foreign banking, securities, and insurance service suppliers in the United States' financial services market, the largest in the world. To make this offer permanent by the December 1997 negotiating deadline, it is critical that our trading partners, especially the key emerging markets, submit significantly improved offers that establish a level playing field for U.S. firms to compete successfully.

This conditional U.S. offer fully incorporates financial sector liberalization undertaken in our market, and reflects important improvements over our 1995 WTO commitments:

First and foremost, the United States is proposing to lock in a broad most-favored-nation commitment to provide access to the world's largest and most open financial market.

On the banking side, the U.S. offer reflects recent liberalization in this sector with regard to interstate banking and interstate branching. In addition, the United States is actively considering a package of major reforms which will further modernize our financial industry. We will work to ensure that foreign participants in the U.S. market also receive the benefit of measures which are adopted.

On the insurance side, the United States is prepared to remove state residency and citizenship requirements for foreign insurers and eliminate restrictions on issuance of insurance licenses in several key states.

With this offer, we are underscoring that the United States is fully committed to reaching a successful conclusion to the WTO negotiations. Now it is up to our trading partners to demonstrate their commitment by putting forward significantly improved offers in the weeks ahead. These offers should allow U.S. firms to maintain their existing activities. These offers should also permit U.S. firms to establish as a branch or to incorporate without ownership restrictions, and to fully participate throughout the market on the basis of national treatment. The United States is willing to consider phased-in commitments in certain cases to facilitate market openings.

The objective of these negotiations is to secure greater liberalization of trade in insurance, banking, securities and other financial services. The United States is committed to seeking a comprehensive agreement that provides substantially full market access and national treatment to U.S. financial service providers in foreign markets. In this negotiation, we are consulting extensively with U.S. industry, which has been actively engaging their foreign counterparts.