WASHINGTON - Representatives of the financial services industry testified Tuesday on Capitol Hill in support of legislation to create more favorable trade relations with China.
At a Senate Banking Committee hearing, industry officials urged lawmakers to pass pending legislation that would grant China "permanent normal trade relations" status. Representatives from the Financial Services Roundtable, the Securities Industry Association, and New York Life International warned that if the bill does not pass, the U.S. financial services industry will be at a competitive disadvantage.
"There are over 50 foreign banks with branch licenses in the People's Republic of China today," said Robert P. Morrow III, managing director of Bank of America's International Corporate Banking Group and a Roundtable member. If Congress delays or defeats the bill, "our European, Latin American, and Asian competitors will certainly seize every opportunity to leverage their new powers to our disadvantage."
SIA president Marc E. Lackritz agreed, noting the attractiveness of the Chinese market. "China has a very good tradition of savings and investment. As transparency in the markets and the base of operations grows, so will opportunities," he said.
The bill would ratify an agreement reached last fall between China and U.S. Trade Representative Charlene Barshefsky, which would lower Chinese tariffs and trade barriers for U.S. goods and services. In addition to the endorsement of Treasury Secretary Lawrence H. Summers, 50 co-sponsors have signed on to the bill, including Senate Banking Chairman Phil Gramm.
"This agreement is a dramatic improvement in opening China's markets," Sen. Gramm said. "Some of the best provisions are for banking and securities."