Financial services are crucial to U.S. economic prosperity, helping fuel economic activity across all industries. Free and fair-trade and investment agreements promote U.S. economic growth and job creation by expanding opportunities for financial services firms to compete in overseas markets and better serve their clients while enhancing the flow of cross-border capital. Similarly, inbound investment by foreign financial institutions contributes to the vitality of the U.S. economy through direct investments and job creation.

SIFMA supports an open, rules based, global economy in which financial services can do its part to boost exports, investment and global economic growth. SIFMA believes that trade agreements should be comprehensive, broaden market access for financial services firms, and address issues specific to today’s economy in digital trade to enhance U.S. economic competitiveness in the 21^st century. To that end, we encourage policymakers to: expand the free flow of goods and services around the world and maximize cross-border investment opportunities; coordinate regulatory approaches across borders to ensure a level playing field for domestic and international firms; and address the rise of impediments to the free flow of data.

U.S.-China Economic Relationship

The U.S.-China economic relationship is one of the most important in the world. SIFMA supports efforts to strengthen the U.S.-China economic relationship including by promoting further opening of China’s financial markets to U.S. and other non-Chinese participants. We therefore welcomed the Phase One Agreement signed in January and applauded the inclusion of important financial services provisions. We encourage both sides to ensure comprehensive implementation of the agreement including the elimination of equity caps on financial services firms invested in China and expanded market access for U.S. financial firms.

Financial Regulatory Cooperation

SIFMA believes that a major obstacle to enhanced trade and investment is uncoordinated and often divergent approaches to financial regulation. As such, we strongly support financial services regulatory dialogue and cooperation. Addressing cross-border regulatory issues through robust dialogues can reduce conflicting rules that add frictions to financial markets, enhance efficiency in cross-border trade and investment, and promote transparency in the rule-making process.

United States-Mexico-Canada Agreement (Trilateral Trade Deal)

SIFMA welcomes the news that the United States, Canada and Mexico have agreed a trilateral trade and investment deal to succeed NAFTA- the United States, Mexico, Canada Agreement (USMCA). For the first time ever in a trade and investment agreement, provisions prohibiting data localization and improving the free flow of data across borders, which are so important to many of our members’ businesses, is protected. USMCA establishes a new high standard for financial services within the context of a U.S. trade agreement.

U.S./UK Trade and Regulatory Cooperation

SIFMA believes strongly in free, rules-based international trade and cross-border investment. With the United Kingdom (UK) having set out its negotiating objectives for trade discussions with the U.S., we look forward to the opportunity to feed in to the creation of a comprehensive and forward-looking UK-United States (U.S.) free trade and investment agreement (FTA).

The long-standing UK-U.S. relationship has important economic dimensions, underpinned by significant similarities in the structure and performance of financial services. London and New York remain the world’s leading financial centers. Financial services account for around seven per cent of GDP in both economies. The UK is both the largest consumer of U.S. financial services exports, and the largest supplier of U.S. financial services imports. Both are capital market-based financial systems, with similar regulatory philosophies.

These common foundations mean a future UK-U.S. trade agreement offers an unprecedented opportunity for putting financial services at the heart of a new, 21^st century economic relationship and enhancing the economic benefits to both countries.

The future relationship between the UK and U.S. in financial services, through a trade and investment agreement and related mechanisms of cooperation, should aim to have four key characteristics:

• Ensure that both economies maximize opportunities for exports and cross-border investment in financial services, integrating the U.S.-UK market in financial services and strengthening the competitive advantage of the industry in both the UK and U.S.
• Be forward looking and transparent and designed to tackle regulatory frictions early in the rule-making process.
• Strengthen the UK and U.S. as leading influencers of the future international financial regulatory agenda as rule-setters.
• Help re-define how trade and investment agreements are conceived, by fully integrating services and addressing truly 21^st century challenges arising from modern technology and cross-border operations.