Top financial services sector stakeholders from throughout the region and the world focused on the need for innovation and regional coordination as among the cornerstones of the future success of the Caribbean's international financial centers (IFCs) , at a high level conference which began in Nassau yesterday.
Organized by the Caribbean Export Development Agency in conjunction with the Ministry of Financial Services in The Bahamas, the Third Caribbean Conference on the International Financial Services Sector has drawn over 200 participants from 24 countries and overseas territories, including The Bahamas, to the British Colonial Hilton to discuss the challenges and opportunities facing the sector.
Policymakers, regulators and financial practitioners of Caribbean international financial centers are expected to interact with representatives of the architects of major global financial policy
initiatives.
Besides generating over 400 room nights of business for the hotel over the three-day course of the event, Minister of Financial Services Ryan Pinder told Guardian Business he hopes the event will result in the delineation of a "comprehensive, strategic plan for financial services in the region" that will see countries throughout the region, including overseas territories, collaborating to promote their interests in financial services globally at a time when they are under increased international regulatory scrutiny.
Both Pinder and Pamela Coke-Hamilton, director of the Caribbean Export Development Agency, who spoke at the opening of the conference, were among those who suggested that it is only by taking this approach that the Caribbean can expect to successfully confront the major challenges that threaten the ongoing survival of the region's international financial services sectors.
Pinder, in an interview with Guardian Business, said that he sees this type of coordination as likely to be particularly important when it comes to matters such as FATCA (Foreign Account Tax Compliance Act) and to confronting the growing global push for automatic exchange of information, which threatens to erode much of the basis of offshore financial centers' competitiveness.
"It's very important for us as a region to make sure we understand it (automatic exchange of information) for one and then ensure we have a concerted strategy to address it and we have both of these as key elements of this conference: both international persons to help us understand it and then regional meetings to help develop a strategy to address it."
With respect to innovation, the minister focused in a later luncheon speech on how The Bahamas is diversifying its product and service offerings in the area of financial services as a means of "insulating" against certain multilateral tax initiatives.
Due to "product innovations and flexibility", Pinder said this country saw an increase of over 15 percent in funds registered in the Bahamas in 2013 as compared to 2012 while focused efforts also contributed to a more than 60 percent increase in captive insurance entities.
Coke-Hamilton said that the Caribbean Export Development Agency (CEDA) is doing its part to defend the financial services sector as a major source of export earnings for the region.
She said that CEDA is now chairing a taskforce for the promotion and protection of the financial sector which will aim to provide recommendations to the offshore financial sector and the political directorate on how to further develop the industry and in particular on the development of "a strategic and comprehensive regional position for coordinated lobbying and advocacy for the region's IFCs within the international forum".
The international trade specialist called for IFCs and governments to move further towards "finding practical mechanisms for keeping this sector vibrant and innovative" rather than "stating grievances" if the region is to remain competitive.
"This may mean the creation of new products, targeting new markets and moving towards further specialization. We must approach this sector as we would any other business and ask the hard questions: where's our niche, what must we do to ensure our clients are satisfied, what must we change now to ensure we remain in business," said Coke-Hamilton.
Ambassador of the EU to Jamaica, Belize, The Bahamas and the Overseas Territories of Turks and Caicos and the Cayman Islands, Paola Amadei, said that it is not the case, as some "maliciously insinuate", that European countries are seeking to "paralyse the financial sector of the region with the burden of regulation and control".
"There is, rather, the genuine concern of true partners to help prevent the infiltration of criminal activities in legitimate business on one side, and to capture resources for country's development by allowing equitable taxation on the other," she said.
Suggesting that Europe has itself done a great deal of reform since the financial crisis, she said a "global holistic approach" is necessary to tackle challenges such as money laundering and terrorism financing.
Prime minister Perry Christie, who also addressed the opening session, reiterated his emphasis in a 2013 speech to the UN that The Bahamas and other offshore financial centers have a right to continue to rely on this sector for their economic growth, telling the conference that if the sector is wiped out it will destabilize countries in the region who see many in their middle class reliant on it for their income. He said that The Bahamas has done much to ensure, and is committed to the belief that, it can be both competitive in offshore finance and responsibly regulated.
He pointed to his government's intention to help the financial services sector remain competitive by focusing on perceived "skills gaps" in the economy and labour market, education initiatives, immigration policies, called for even greater effort on the part of the industry itself to "champion" its cause both locally and internationally.

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