Protocol having been established, it gives me great pleasure to join Dr. Worrell and the Hon. Donville Inniss in welcoming you to this year’s International Business and Financial Services (IBFS) Conference. Each year, BIBA is pleased to support the Central Bank of Barbados in its efforts to bring together representatives from the public sector agencies key to the success of this sector, to dialogue with and share views with BIBA and other private sector representatives on how to further advance our collective goals. It is interesting to note that the Bank has identified the opening up of the Cuban market as one of the potential growth areas for the Barbados IBFS sector. The shift in United States policy that has created this potentiality could likely lead to more multinational companies targeting Cuba and, with a long-standing bilateral investment treaty and double taxation agreement between Barbados and Cuba already in place, I believe that we are well poised to capitalize on this interest. Ironically, as we sit and meet today to learn more Cuba, right at this very moment, history is being created in Panama at the convening of the Seventh Annual Summit of the Americas – for the first time in history, Cuba has a seat at the table for this Summit. I therefore look forward to the first panel presentation unlocking this potential for us.
It is well recognized that Barbados has all of the factors necessary to continue to grow the international business sector. Indeed, we continue to show year-on-year growth in new entrants to the sector, even during the height of the international economic turbulence within the last seven years. The most recent figures show that Barbados continues to attract new IBC registrations in excess of 400 annually since 2007, and at an average rate of 458 new registrations annually over that period.
In relation to international insurance, we continue to maintain our number at just over 240 active entities, and while on record our international banks have dwindled from 40 at the end of 2013, to 32 at the end of 2014, we should note that much of the business that was being carried on by companies holding banking licences, is now being conducted within IBCs, ISRLs, or just regular Barbados companies.
However, we must remain ever cognizant of the challenges that threaten to undermine our growth potential. And unfortunately some of the more major challenges are not of our own making. The changes made to the domestic taxing environment in Canada last year have had a significant effect on a market segment that we have historically enjoyed. This is reflected in the number of entities currently holding banking licenses as I referenced earlier – another reason that I am keen to hear the presentations from the panel in a few minutes.
Increasingly, some members of BIBA have been raising concerns with us about the hurdles they and their clients are facing as clients of local commercial banks. As was ventilated during our first BIBA luncheon seminar for this year, the strict requirements being imposed on international business clients by commercial banks is as a result of the risk profile with which Barbados is viewed by the international correspondent banks that mediate between the local commercial banks and the global financial community. This is an extremely untenable situation as Barbados seeks to fulfil the mandate of its sector’s strategic plan and become the International Business and Wealth Management Centre of choice in this hemisphere. It also does not bode well for our attempts to expand our treaty network into Africa and Latin America and attract more business from those source markets. I think that it is time that we refreshed our strategy in terms of expanding the correspondent banking relationships within our commercial banking sector and I am offering BIBA’s support to the Central Bank of Barbados in leading the development of a new strategy to attract new players into this arena.
However, I must reiterate, as I always do, that if we are to keep the new businesses that we attract, and hold on to the ones that are already here, we must improve the ease with which we conduct business in Barbados. We need to put service level agreements in place that guarantee clients in the public and private sector certainty of process when they engage with a business facilitation agency.
I would say that the recent implementation of guidelines for all public sector employees by the Office of Public Sector Reform is a step in the right direction and I would encourage that Office to undertake as its next project, to produce benchmarking guidelines for government agencies, especially the client-facing ones, so that there are standards to which they can be held accountable. Our judicial, business incorporation and immigration systems are the first places that I would recommend we start.
On that note, we have a stimulating day ahead of us and far be it for me to delay the Minister in delivering his keynote presentation. I look forward to hearing from the presenters and yourselves on some of the key issues that I have raised, as well as the other topics under consideration, during the course of today.
Thank you for your time and attention.