The Murray Financial Inquiry is due to report in July but documents from Wikileaks released to the Sydney Morning Herald appear to show the federal government is about to fundamentally try to change the shape of Australian financial services.
The SMH says that it has received sensitive documents from the “Trade in Services Agreement” (TiSA) negotiations which show Australia appears willing to trade away the local ownership of the majors and the “Four Pillars” strategy in Australian banking in a bid to radically change its financial services landscape.
In echoes of Paul Keating’s “Big Bank” from the 1980’s, the Government is looking to:
…allow foreign banks much greater freedom to operate in Australia. The changes could also see Australians’ bank accounts and financial data freely transferred overseas and allow an influx of foreign financial and information technology workers.
Trade Minister Andrew Robb told the SMH that:
The negotiations were a “key focus” in his policy to “open as many doors as possible” for Australian financial services. “Financial services are a key part of the negotiations for us given the strength of our sector in areas including banking and wealth management, particularly in the major, growing markets of Asia…”
The TiSA are part of overall World Trade Organisation and text seen by the SMH shows that:
US and European Union proposals for each party to the agreement to allow financial service providers of other parties the right to establish or expand within its territory “including through the acquisition of existing enterprises”.
In a related piece, The Age economics editor Peter Martin says the “most shocking thing about the leaked draft of the Trade in Services Agreement is the innocuously named ‘dispute settlement’ provision”.
The authors – the European Union and the US – want Australia to let an outside arbitrator re-adjudicate decisions made by government ministers and the High Court.
Hopefully while a desire by the Government for improvements to the Australian financial services sector is laudable, this element needs great consideration and care.
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