Obama Plans to Join Trade Talks on Financial Services
President Barack Obama is set to notify Congress early next week that the U.S. plans to participate in trade talks to lower national barriers to financial services, telecommunications and express delivery, according to people familiar with the decision.
U.S. Trade Representative Ron Kirk’s office is preparing a 90-day notification to Congress that it will take part in so- called trade in services negotiations at the World Trade Organization in Geneva, the people said. They declined to discuss the process on the record before a formal announcement.
Services are a growing portion of international trade, accounting for about $8 trillion in 2011, according to WTO statistics. The countries involved in the talks account for about 70 percent of global commerce.
Discussions probably will cover the cross-border movement of financial data, information and communications services, maritime, environmental and energy services and government procurement.
Nkenge Harmon, a spokeswoman for the USTR in Washington, declined to comment, saying by phone: “We haven’t notified Congress, and when we notify Congress, we’ll notify Congress.”
It would be the first new trade negotiation since Obama was re-elected in November.
An agreement should address the free movement of data because manufacturers rely on the flow of information and services to facilitate their cross-border operations, according to the Coalition of Service Industries, a Washington-based trade group. Its members include JPMorgan Chase & Co. (JPM), Verizon Communications Inc. (VZ), Walmart Stores Inc. (WMT), Microsoft Corp. (MSFT), AT&T Inc. (T), Visa Inc. (V), and FedEx Corp. (FDX)
Peter Allgeier, a former U.S. ambassador to the WTO who is now head of the CSI, last month called the agreement on a framework for the talks encouraging and praised “the degree of collaboration and cooperation.”
He said he hopes the talks produce an ambitious agreement that creates new trade opportunities rather than just consolidating concessions in existing bilateral accords.
A group of 21 governments agreed on five goals for the discussions of an accord to liberalize services last month, and pledged to begin negotiations this year.
Unlike other WTO talks, only those countries that choose to participate are part of the discussions. So far, Brazil, China and India, three of the world’s fastest-growing economies, have declined to participate in the talks. They say the negotiations will impede efforts to reach a global deal as part of the WTO’s Doha Round.
WTO members participating in the exploratory talks are the U.S., the European Union, Australia, Canada, Chile, Colombia, Costa Rica, Hong Kong (2823), Iceland, Israel, Japan, Mexico, New Zealand (ANZ), Norway, Pakistan, Panama, Peru, South Korea, Switzerland, Taiwan and Turkey.
The 21 governments, which represent 50 countries, account for about 70 percent of global commerce, according to the CSI.
John Clancy, the European Commission’s spokesman for trade in Brussels, declined to comment about what the U.S. notification would mean for the services talks.