EDITORIAL - Region must do more to defend IB sector

MINISTER of International Business, the Honourable Donville Inniss, reported yesterday that Caribbean countries have not been doing enough to protect their financial services sectors against the allegations that this region is guilty of almost everything the international community has thrown at it when it comes to that sector.

The region has been accused of money laundering, indulging in harmful taxation policies and has even been blacklisted for such. The most recent assault has come from the American state of Illinois, which took a swipe at the region including Barbados. Inniss, who is Barbados’ Minister of Industry, International Business, Commerce and Small Business Development, reasoned that this latest development involving Illinois deserves some action by the Caribbean and not just one island.

“We are 15 nations going into the international fora, grappling with an understanding of the issues and then perhaps 15 divergent positions on the matter. I have been saying publicly and
privately in regional meetings that we really need to come together.”

The attacks which the international community have launched on the small islands as far as this financial services sector goes, is nothing new. The Organisation for Economic Cooperation and Development (OECD) and many of its sidekick organisations had taken a position that Caribbean countries were not cooperating with the new rules laid down for the orderly conduct of doing business. It had become so rampant that in 2000 Barbados took the initiative and hosted a conference in conjunction with the Commonwealth Secretariat to thrash out the issues and to let the international community know that the global rules were being adhered to. While that conference did put a halt to some of the proceedings against the region, it did not put an end to the accusations from the global powers and their agencies. This has been happening every since.

International Business is a major plank in the Barbados economy, accounting for between $800 million and $900 million revenues flowing into the country. Approximately 4 000 persons are employed in the sector, which also provides opportunities for a vast number of professionals in the legal, accounting and other services areas.

What Illinois has done can therefore be interpreted as a threat to the industry, which currently has its challenges as a result of the changing tax laws that some countries with whom Barbados has treaty networks continue to adjust.

So it is right for Inniss to flag the issue. However, he is fully aware that in the first place International Business is not as prevalent in other regional countries as it the case with Barbados. So if countries do not have a vested interest they are more inclined to sit it out.

Secondly, Inniss has also in the past commented on the region’s silence when it comes to Caribbean rum entering the USA. Only last month the point was raised at a function regional rum producers held in Barbados, that rum produced in this region is facing unfair competition in the USA . However, no one other than Barbados is making noise about this, although other rum producing states have a vested interest in this matter.

They prefer to keep a low profile while one or two others have been trying to get to the root of that matter, and this should not be the case.