Tokyo was instrumental in hammering out an interim financial services liberalization pact when Washington withdrew from the earlier talks. But this interim deal expires at the end of 1997. The pressure now is on Tokyo and European capitals to encourage reluctant governments to make bolder liberalization offers. Several advisory panels face a June deadline for submitting detailed draft reports. On paper Mr. Hashimoto's plan, with its 2001 implementation deadline, might meet the U.S. standard for an acceptable transition period before complete liberalization.
Japan also professes to adhere to a policy of national treatment for financial services firms.
Full foreign ownership of financial institutions is possible. Experts hope the June draft reports will lay out a clear reform road map. Some worry that, unless the recommendations are very detailed and well thought-out, the task of turning Mr. Hashimoto's plan into reality will fall to bureaucrats, perhaps dooming the chances for the significant reforms sought by the prime minister and the White House alike. Perhaps Mr. Hashimoto hopes to use the drive to conclude a global financial services pact as a prod to encourage the domestic changes he is seeking. The prime minister also could argue that if Japan is not willing to undertake possibly painful and disruptive reforms, it is not in a position to ask others to do so.