Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, July 27, 1995 TAG: 9507270059
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: Associated Press
DATELINE: GENEVA LENGTH: Medium
The much-awaited agreement to open the financial-services markets came after Japan and South Korea signed onto the deal. It will be formally endorsed Friday, giving members of the World Trade Organization up to then to consider any last-minute changes.
But the announcement of the accord was somewhat marred by the United States' decision not to participate, even though American businesses still will benefit from the deal.
The United States pulled from negotiations on the accord in June, believing some countries had not opened up their markets sufficiently
World Trade Organization Director-General Renato Ruggiero applauded the agreement as ``a new step toward a more integrated world and a better globalized economy.'' But he said that U.S. decision not to take part meant the accord could only be ``second best.''
Financial services, which is considered a huge and growing world market, was left out of a global trade pact in 1993 after the United States complained that some developing countries had failed to open their markets enough.
Negotiations continued for another 18 months in hopes of gaining a better deal, but Washington again backed out last month.
But the decision by Japan on Wednesday secured the approval of the pact. Japan had previously held out on making a commitment, and its participation was considered vital.
Under the agreement, 95 nations in the WTO are committed to opening their markets on an equal basis to all members.
The accord expires at the end of 1997, when a new agreement will be negotiated. U.S. Treasury Secretary Robert Rubin said Wednesday the United States will participate in those talks. Washington will still be free to restrict access in its financial-services markets to those countries it believes have not opened up their markets sufficiently.
The United States already has a relatively open financial-services market, but by opting out of the accord, it has reserved to the right to close its markets to countries it believes are still too protectionist.
The deal does not include the huge markets of China and Russia, which are still negotiating WTO membership.
Trade analysts say the most visible effect in many countries will be the appearance of more foreign banks, securities firms and insurance companies.
by CNB