- Registration time
- Last login
- Online time
- 673 Hour
- Reading permission
This post was edited by SMITHI at 2012-6-4 18:32|
Financial Deregulation at a Global Level
While the 1999 US Financial Services Act does not in itself break down remaining barriers to the free movement of capital, in practice, it empowers Wall Street’s key players, including Merrill Lynch, Citigroup, J.P. Morgan, Lehman Brothers, etc., to develop a hegemonic position in global banking, overshadowing and ultimately destabilizing financial systems in Asia, Latin America and Eastern Europe...
Financial deregulation in the US has created an environment which favors an unprecedented concentration of global financial power. In turn, it has set the pace of global financial and trade reform under the auspices of the IMF and the World Trade Organization (WTO). The provisions of both the WTO General Agreement on Trade in Services (GATS) and of the Financial Services Agreement (FTA) imply the breaking down of remaining impediments to the movement of finance capital meaning that Merrill Lynch, Citigroup or Deutsche-Bankers Trust can go wherever they please, triggering the bankruptcy of national banks and financial institutions.
In practice, this process has already happened in a large number of developing countries under bankruptcy and privatization programs imposed on an hoc basis by the Bretton Woods institutions. The mega-banks have penetrated the financial landscape of developing countries, taking control of banking institutions and financial services. In this process, the financial giants have been granted de facto "national treatment": without recourse to the provisions of the Financial Services Agreement (FTA) of the WTO, Wall Streets banks, for instance, in Korea, Pakistan, Argentina or Brazil have become bona fide "national banks" operating as domestic institutions and governed by domestic laws which are being remolded under IMF-World Bank jurisdiction. (See Chapters 21 and 22.)
In practice the large US and European financial services giants do not require the formal adoption of the GATS to be able to dominate banking institutions worldwide, as well as overshadow national governments. The process of global financial deregulation is, in many regards, a fait accompli. Wall Street has routinely invaded country after country. The domestic banking system has been put on the auction block and reorganized under the surveillance of external creditors. National financial institutions are routinely destabilized and driven out of business; mass unemployment and poverty are the invariable results. Assisted by the IMF – which routinely obliges countries to open up their domestic banking sector to foreign investment – retail banking, stock brokerage firms and insurance companies are taken over by foreign capital and reorganized. Citigroup, among other Wall Street majors, has gone on a global shopping spree buying up banks and financial institutions at bargain prices in Asia, Latin America and Eastern Europe. In one fell swoop, Citigroup acquired the 106 branch network of Banco Mayo Cooperativo Ltda., becoming Argentina’s second largest bank.