By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
The Clearing Banks Association's (CBA) chairman has urged the private sector to play a greater role in preventing The Bahamas from being "blindsided" by the OECD and other initiatives.
Gowon Bowe told Tribune Business that the financial services industry needed to "leverage" its own contacts to uncover, and head-off, attacks such as last week's listing of The Bahamas' economic permanent residency product among 21 countries whose regimes were deemed potentially harmful to the global anti-tax evasion fight.
He added that The Bahamas needed "to mobilise what I call our best defence team", featuring public and private sector executives, in dealing with the Organisation for Economic Co-Operation and Development (OECD) and other international bodies that frequently threaten this nation's financial services industry.
Arguing that the task cannot be left to the Government alone, Mr Bowe said The Bahamas needed to ensure it was fully involved in working groups such as the OECD's Global Forum on tax transparency and information exchange rather than rely on a single person or minister-to-minister dialogue.
Regardless of whether it was a "blacklist" or not, then Clearing Banks chief said The Bahamas' inclusion on the OECD list was "not a positive sign for us", and this nation needed to move rapidly to address any concerns that the group, which represents the world's most powerful economies, has.
"As a country we really have to be in a position where these things are not coming as a surprise, and we are keeping a better finger on the pulse," Mr Bowe told Tribune Business.
"I've seen the reaction by certain government officials in terms of the negative reaction, but we are in reality playing in their [the OECD's] space and can't reply negatively to the pronouncements and actions they take.
"We can't be emotive in our response. It makes it seem like we're having a knee jerk reaction. We have to demonstrate a position of sensitivity, a position of confidence, and that we are concerned with criticism and have policies in place to address and mitigate it."
The OECD caught the Government, as well as the financial services industry and wider private sector, off-guard last week by listing this nation's economic permanent residency offering among the investment incentive regimes of 21 countries that it says jeopardise "the integrity" of its Common Reporting Standard (CRS) automatic tax information exchange initiative.
While the OECD's list, and accompanying report, did not mention the imposition of sanctions or penalties against The Bahamas and 20 other countries, it did call on financial institutions to apply greater scrutiny to persons benefiting from their investment-related residency and citizenship programmes when it came to determining their tax compliance.
Mr Bowe said The Bahamas needed to quickly find out whether the OECD was objecting to all investment-related residency and citizenship regimes as a whole, which seemed unlikely since members such as the US, UK and Canada all offer similar incentives, or whether there were specific concerns with this nation's economic permanent residency product that may have arisen from misunderstandings and lack of knowledge.
Calling on the Government to make the regime's safeguards known, he added: "We can't cry when we're playing in their sandbox. We have to decide whether to change the regime to comply or stop playing in their sandbox. We cannot be the child who is spoilt and cry about it. We have to be mature about it and demonstrate the regime we have in place."
The Bahamas' inclusion on the OECD list, at the very least, will plant "seeds of doubt" and uncertainty in the minds of investors as to the benefits of holding/seeking economic permanent residency given that they will likely be subjected to greater scrutiny.
This will be especially unwelcome for investors who have legitimate privacy concerns, such as those from high-crime and politically unstable countries in Latin America, increasingly a key source of business for The Bahamas, who may fear that information extracted by greater CRS scrutiny could fall into the wrong hands.
As a result, the OECD listing threatens to negatively impact a wide cross-section of the Bahamian economy, not just the hard-pressed financial services industry. Besides attracting high net worth clients and their assets to this nation, economic permanent residency drives lucrative business for real estate developers, realtors and attorneys, and produces spin-offs affecting virtually all industries.
Mr Bowe said the Bahamas has "to get it right in terms of our engagement" with the likes of the OECD and European Union (EU) to avoid being continually "blindsided" by their activities.
"Our engagement does not appear to be at the level we expect it to be where we are not blindsided," he added. "If we're piecemeal in our response we're going to continually face these threats. We cannot be reacting to every report."
Comments
VDSheep 5 years, 6 months ago
We are puppets to international banking oligarchs – they rape and abuse nations financially – if we are pirates – there must be another name for them! Somehow we need to be able to outwit them ‘ as the world turns - instead of being the natural lackey that we continue to be – said the blind man to his deaf and dumb child
Well_mudda_take_sic 5 years, 6 months ago
Publicity seeking Bowe would be wise to listen to and heed his own words. The OECD and similar international bodies take great joy in reading local press reports like this one that tell them they have once again succeeded in rattling our cage. In any event, Bowe still just doesn't get it. These ongoing blacklistings are not at all about us being able to play in the OECD's sandbox as he likes to put it. They are instead about the OECD wanting to take all of the sand out of our own sandbox for their own benefit by unfairly coercing and bullying us to assist them (at great expense to Bahamian taxpayers) to collect the very burdensome and onerous taxes they inflict on their own citizenry. It's really as simple as that.
Well_mudda_take_sic 5 years, 6 months ago
P.S. The OECD is an existential threat to the Bahamian economy and standard of living for most Bahamians. The hardcore plutocrats within the OECD have always justified the elitist status they enjoy within their own member states by bullying and bashing the countries they choose to target, in the main smaller developing ones like the Bahamas. For the better part of two decades now they have gotten away with their abusive and wrongful interference in the law-making and policy decision-making processes of other sovereign nations. Their main tactic for doing so has been to falsely accuse the nations they target of one thing after another, from having conditions conducive to money laundering, conditions favorable to the financing of terrorism, and in more recent times, conditions that encourage and promote foreign nationals to evade and/or avoid the payment of overly burdensome taxes imposed by their home states, typically OECD member states themselves. The push-back should be that there is overwhelming evidence to show that these OECD plutocrats should be much more concerned about the rampant money laundering and terrorist financing activities taking place daily within their own national borders. Also, they should not be seeking to prop up the grossly bloated, highly wasteful and outrageously costly government bureaucracies within their own member states that only serve to encourage and promote tax evasion and/or avoidance by their own citizenry. Let's not forget too that the OECD member states provide the funding for the elitist OECD plutocrats to conduct their extra-territorial shenanigans! The victimized countries need to continuously call out the abusive and wrongful bullying practices of the elitist OECD plutocrats that seek unjust and unfair gain for their member states at minimal cost to themselves, but at great cost to their victims. These elitist OECD plutocrats have no respect or regard for the victimized citizenry of the countries they decide to target, often quite arbitrarily and nearly always for absolutely no reasonable cause whatsoever. They need to spend much more time looking at themselves in the mirror because all of the problems of which they speak exist right on their own home turf and that is where they should be fighting them.
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