The Tribune

A Cabinet minister yesterday said Britian’s exit from the European Union (EU) will “no doubt” have some effect on the Bahamas and the wider Caribbean,  adding that she expected very little impact - if any - for the financial services industry.

Hope Strachan, minister of financial services, said:  “That decision, as it stands, does not currently affect our participation in the CARIFORUM-European Union Economic Partnership Agreement (EPA), a reciprocal trade agreement that was signed by the Bahamas in 2008 and one to which the UK is also a signatory.

“The effects of that decision will no doubt have some impact upon the Bahamas, CARICOM and CARIFORUM in the long run.  It is difficult to predict the degree to which there will be any fall-out in our trading relationship with Britain and the European Union, as the events are still unfolding.”

Mr Strachan said Article 244 of the EPA binds all of its signatory member countries, including the UK, until a member country denounces it.

“Additionally, the formal process of withdrawing from the EU is provided under Article 50 of the Lisbon Treaty, when the UK would have to give formal notification to the EU of its intention to withdraw,” she added.

“Once that notification is given, there is a two-year window for the negotiations to be completed. If the negotiations are not completed within the two years, the existing EU treaty arrangements with the UK will terminate unless all EU members agree to continue the negotiations. It is therefore reasonable to conclude that there will likely be no change in the status of the existing treaty arrangements between the EU and the UK at the very least until 2018. “

Mrs Strachan, while expressing relief that the relationship was preserved in the short-term, said that in order to maintain trade with the UK and secure concessions similar to those under the EPA, the Bahamas and CARICOM may have to enter into a trade agreement with the UK. 

CARICOM Heads of Government are expected to discuss the issue at their upcoming meeting in George Town, Guyana, from July 4-6.

Mrs Strachan said she expects the UK’s exit from the EU will have very little impact, if any, on the financial services sector.

“London is still expected to continue to be one of the leading international financial centres,” she added.

“However, the Bahamas will have to continually monitor all developments to ensure that it is not caught off-guard and to capitalise on any opportunities that arise.”