Thursday, October 16, 1997
OTTAWA - Today, the Canadian Community Reinvestment Coalition (CCRC) called on Jim Peterson, the federal Secretary of State (International Financial Institutions), to set out the government's plans for public consultation on the World Trade Organization's (WTO) financial services industry agreement.
The WTO agreement is currently under negotiation in secret in Geneva, and it is expected about 50 countries of the WTO will sign an agreement by the end of this year that will remove barriers to foreign financial institutions entering Canada and other countries. Today, October 16th, the WTO is holding a negotiating session on the agreement.
To date, the federal government has not conducted any consultation with consumer or small business interests concerning its position on the WTO agreement. On September 25th, the Department of Finance released a discussion paper on foreign bank entry but this paper does not deal with the WTO agreement directly. The discussion paper also recommends that foreign banks in Canada be prohibited from accepting deposits of under $150,000. This would preclude most consumers and small businesses from having the same choices as big business and wealthy individuals. To maintain their market share and profit levels, Canada's banks would likely have to cut their prices for large and wealthy customers, while increasing prices for small businesses and moderate-income customers.
"We are very concerned about the potential impact of the WTO agreement and the government's proposals for foreign bank entry on financial consumers, small businesses and access to capital for job creation," said Duff Conacher, Chairperson of the CCRC, "The federal government must engage in meaningful consultations with financial consumers and small businesses with all the options on the table" said Conacher, "and the government should not finalize its position nor sign the WTO agreement before the concerns of consumers and small businesses are addressed. Banking policy should not be made in secret or focussed solely on protecting Canada's big banks."
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