Richard Nesbitt, CEO of the TSX Group Inc., issued a call Thursday for North American business leaders to pressure politicians for freer trade in financial services.

Nesbitt, speaking to the American Chamber of Commerce in Canada, said a communique signed by the leaders of Canada, the US and Mexico included a commitment to freer capital markets, and some of the follow-up work has been begun by negotiators in all three countries. “What is missing is the kind of focused support that can only come from organizations with high credibility on cross-border issues – of which the foremost is the American Chamber of Commerce in Canada,” he said.

“So I hope that you will bring to bear this group’s influence in both Ottawa and Washington — and a mere glance at your membership is evidence enough of how formidable that influence can be. That influence is needed now,” he said. “Our governments, in both their political and bureaucratic dimensions, need solid evidence that there is political support for what they are doing. If they do not see it, they will do other things for which there is political support.”

Nesbitt also highlighted the growing competitive threat from European markets. “To give an example of Europe’s growing heft in capital markets, the volume of equity issues in Europe so far this year represents 41% of the total. The United States is at 33%. This competitiveness isn’t theoretical. European derivatives exchanges are already operating on this continent,” he noted.

“So if we want the efficiency and productivity, in which our only real protection lies for our capital markets, then I believe these barriers have to come down,” Nesbitt said. “In the meantime, we intend to use what technologies, techniques, skill and energy we can muster – barriers or not – to strengthen our base in Canada and sell an increasing number of listing, trading and data products into the U.S.”

He also indicated that it’s expecting increased competition from U.S. exchanges and networks, and European and Asian exchanges.

So far, the TSX has been losing share to foreign rivals. Nesbitt reported that its share of interlisted trading has gone from 62% in 2002 to 49% in the first quarter of this year. However, he noted that the trading pie has grown much larger. In 2002, the TSX’s share of the average value of interlisted trading was around $35 billion a month. Now, its market share has diminished, but the value of that share has risen to $51 billion. “It’s the value of our share that counts, and we’re doing quite well by that measure,” he said.