Byer Suckoo: No Pay Difference In Public Service
There is no disparity between the salaries of male and female workers across Barbados’ public sector. Minister of Labour, Senator Dr. Esther Byer Suckoo disclosed this finding yesterday, while speaking at the media launch of the 2016 United Nations Development Programme (UNDP) Human Development Report, at United Nations House. According to data trends from the report’s Human Development Index, it was recorded that on average, “women globally are paid 23 percent less than their male counterparts.” However, based on localised research, the island’s Labour Minister revealed that this trend was not occurring in Barbados’ public sector. “We’ve heard the figures about women being paid less than men… I must say that since I’ve heard these figures I have been looking for the evidence [locally]; and I have not been able to find it at our Statistical Service or in the Ministry of Labour…. “We have not been able to find that job for job, where all other things are equal, men and women are paid differently. We know across the Civil Service men and women at the same grade are paid the exact same amount,” she verified. While maintaining that there was no gender-related pay difference within the “formal sector”, Senator Byer Suckoo cautioned against such a practice which might occur within the “informal sector”. The Minister told those gathered: “If this is happening in smaller agencies which may not come under the collective agreements…then that is something that we would be very concerned about…because our legislation does not allow for this disparity of wages job for job…,” she stressed. In supporting the development of disadvantaged groups, which were identified in the UNDP Report as women, children, victims of forced labour, impoverished persons and the disabled; the Senator called on other Ministries to remain “vigilant” and ensure that these trends did not permeate the Barbadian society. Minister Byer Suckoo stated: “The Barbados National Employment Policy and the Human Resource Development Strategy have prioritised the empowerment of the vulnerable groups in our labour market. My Ministry is administering targeted programmes in employment and training for these vulnerable persons… “We are also now partnering with the Ministry of Social Care, Constituency Empowerment and Community Development on the Strengthening Human and Social Development in Barbados Programme to eradicate poverty.” The media launch culminated with a panel discussion featuring Minister Byer Suckoo; Stephen O’Malley, Resident Representative of the UNDP Barbados and the OECS; Sean Cooke, Representative for the Barbados National Organisation of the Disabled; and Neisha Cave, Youth Economist. Article compliments BGIS.
Gov’t Focusing On Improving Business Facilitation
Government is actively exploring ways of improving business facilitation and this country’s competitiveness. This assurance came from Prime Minister Freundel Stuart, as he delivered remarks at the launch of the 11thEuropean Development Fund’s (EDF) Regional Private Sector Development Programme, earlier today, at the Lloyd Erskine Sandiford Centre. Mr. Stuart said that small open developing countries needed to earn foreign exchange in order to maintain and improve the quality of life of citizens and ensure their survival. “The recent developments in the world around us: the events of 2007 and their enduring consequences; Brexit; and the effects of climate change, have all conjoined to make the environment even more challenging. But we know that our resilience, demonstrated over the years, is testimony to our capacity to recreate ourselves and to overcome the odds,” he told his audience. The Prime Minister stressed that private sector development in the Caribbean remained pivotal and suggested that exporters must continue to be empowered to penetrate global markets. According to him, enabling and strengthening the private sector was the most effective way of ensuring continued economic growth in this region. He urged the regional private sector to be proactive and creative and seek to increase the number of projects that could be assisted to the next stage by the Caribbean Export Development Agency. “Countries like Barbados need foreign exchange for almost every stage of our production in the various sectors. But if we do not earn it, we cannot spend it without serious effects on our entire economy and society. For example, companies in the retail sector – which use a large proportion of foreign reserves in providing the goods that we both need and want – must be creative and explore how they can assist in producing more foreign exchange, through contributing in some way to our export thrust,” he insisted. During the launch, the Caribbean Export Development Agency and the European Union (EU) signed the 11th EDF agreement worth EUR 24 million to support regional private sector development. Mr. Stuart told the gathering that the signing was another clear indication of the EU’s steadfast commitment to the region, and its support of Caribbean Export in implementing programmes aimed at assisting the private sector in the Caribbean. “EDF programming has contributed to job creation, revenue generation, and export growth, within the states of the Caribbean region… and it has boosted our capacity to compete with firms on the global landscape,” he pointed out. Under the 11th EDF, focus will be placed on market penetration, supply chain and intelligence frameworks, increased access to finance, and the promotion of green energy and energy efficiency as key factors in lowering costs. The overall objective of this programme is to, among other things, increase employment creation and reduce poverty in CARIFORUM states through targeted interventions that provide innovative frameworks for growth and development. Article compliments GIS Barbados.
Barbados International Finance & Business 2017 Magazine Now Available
The Barbados International Finance & Business (BIF&B) 2017 magazine is now available. This annual magazine, now in its ninth year, is a publication of Invest Barbados. It caters to the international business and financial services community, highlighting through several stimulating articles by a range of knowledgeable experts in the field, why Barbados continues to be an attractive jurisdiction of choice for investors. Whether your focus is on international business, international insurance, wealth management, general features on Barbados as a preferred domicile, real life case studies on various international entities or the quality of life that the jurisdiction offers, it can all be found within this magazine. In his message, Minister in the Office of the Prime Minister with Responsibility for Energy, Immigration, Telecommunications and Invest Barbados, Senator the Hon. Darcy Boyce, discusses the enhancements that have occurred within the sector during the last year. He indicated that although there were fresh challenges emerging, the Government of Barbados in conjunction with Invest Barbados and other government agencies would work together to facilitate the smooth conduct of business in Barbados. Additionally, as Invest Barbados celebrates 10 years of operations, the Corporation’s Chief Executive Officer (Ag.), Sandra Payne, shares in her message that, “…we will maintain the ethos and values of good governance and efficiency which have characterised our success…Together with our stakeholders we will nurture a more prosperous Barbados.” The BIF&B 2017 magazine is available from any of its three offices: at headquarters in Barbados, New York, USA or Toronto, Canada. It can also be viewed online here. Be sure to get your copy today. Article compliments Invest Barbados.
GERMAN ENVOY CALLS ON SENATOR MCCLEAN
Germany’s Ambassador to Barbados, Dr. Lutz Görgens, recently paid a courtesy call on Minister of Foreign Affairs, Senator Maxine McClean, to mark the occasion of 50 years of bilateral relations between the two countries. Ambassador Görgens stated that he was very happy to meet with the Foreign Minister to celebrate their 50-year relationship, which he described as “unparalleled and incomparable”. A main focus of the conversation was protecting and preserving the island’s coastlines, which Senator McClean noted was of critical importance to Government. Dr. Görgens suggested that Barbados participate in the Caribbean Challenge initiative, a project geared at bringing together governments, companies and partners, to collaborate on accelerating action on the marine and coastal environment in the region. The officials also discussed the challenges associated with regional marine and air transport, to which Minister McClean proposed that the region should cooperate and explore the idea of establishing a commercial ferry operation. Article compliments BGIS.
BYER SUCKOO: STRENGTHENING OF HUMAN CAPITAL A MUST
Barbados must focus on building the capacity of its human resource capital, as Government moves towards the implementation of its Green Jobs Initiative and Climate Change Adaptation and Mitigation Strategy. Minister of Labour, Social Security and Human Resource Development, Senator Dr. Esther Byer Suckoo, expressed this view recently, during a courtesy call from Japan’s Ambassador, Teruhiko Shinada, at the Ministry of Labour, Warrens Office Complex. Stating that there will be a need for adjustments to the roles of employees across various sectors, Senator Byer Suckoo noted that jobs would need to incorporate new techniques to support a sustainable green economy and mitigate against climate change. “It’s one thing to build the structures and ensure that our buildings…and other infrastructures are in place, but we also need to ensure that the workers know how to do the new things required… “Agriculture, for example, is very susceptible to climate change. Changes in rain fall and other factors can affect our cultivation, so there will have to be new ways of doing agriculture…and the people involved in agriculture have to be trained,” she explained. The Minister also highlighted the fishing industry as an area where training and capacity could be upgraded, due to the direct impact of climate change on our reefs and fish harvesting. Mr. Shinada, who shared in the Minister’s sentiments, disclosed that Japan was also “diligently working” on measures to combat climate change, and outlined how the two countries could collaborate. According to him, capacity building could be achieved through possible collaborations with the Japan International Corporation Agency (JAICA), which fulfills this mandate within various organisations. Other areas of discussion included strengthening the social security system of Barbados, as Japan also has an ageing population, which has impacted on its social security system; reducing youth employment through the promotion of innovation and the green economy; and retrofitting the work place to provide greater opportunities for disabled persons to be hired. Acting Permanent Secretary in the Ministry of Labour, Yolande Howard; and Acting Chief Labour Officer, Victor Felix, were also present at the meeting. Article compliments BGIS.
Caribbean: CARICOM seeks FATCA delay, but law may prove irrelevant
The Caribbean Community is looking at spending nearly quarter of a million dollars on a Washington-based consultant to lobby the Trump administration about the Foreign Accounts Tax Compliance Act, reports Cayman Compass. Cayman appears unlikely, however, to be affected by any lobbying – or even FATCA repeal – in the wake of last year’s enactment of Common Reporting Standards by the Paris-based Organisation for Economic Co-operation and Development. In mid-February, Trinidad and Tobago Prime Minister Keith Rowley announced moves by the 15-member CARICOM bloc to spend $240,000 countering a FATCA threat to correspondent banking in the region. As reported by the island state’s Daily Express on Feb. 18, Mr. Rowley said the organization would jointly contribute the sum, employing lobbyists to ensure Caribbean banks did not suffer censure or loss of correspondent banking access. “It is only for a short period as it is a specific assignment,” he said in an address. I think it’s US$40,000 for the period for which the lobbyist would be hired to carry out this specific exercise,” he said after returning from a two-day Guyana meeting of CARICOM heads of government. They had agreed, he said, “that cost should be incurred and the lobbyists should be hired and put to work to join the efforts made by CARICOM to ensure that we stave off any further de-risking or loss of correspondent banking access.” Calling it “a threat to our banking system,” the prime minister worried about a “collapse of the banking [system] in the region if in fact we are to find ourselves regarded as a high-risk area and lose correspondent banking facilities.” The move, however, appears to be less than a push for FATCA repeal as an effort to avoid penalties should Trinidad and other CARICOM members delay acceptance of the U.S. tax legislation. CARICOM needed to ensure its banking system was not denied access to corresponding banks and, therefore “not denied access to our trade,” he said. “We are at great risk,” Mr. Rowley said, urging countries “to ensure that we pass the necessary legislations, that we are compliant with the international standard that is demanded of us and that we ensure that we make every effort that we lobby in the relevant quarters that we are not treated adversely,” he said. In late November 2013, Cayman’s Tax Authority agreed to provide details to Washington’s Internal Revenue Service of all Cayman’s U.S.-resident and U.S.-affiliated account holders at 28,559 locally based “Foreign Financial Institutions.” The move, affecting nearly 6,000 local residents, has generated intense opposition, as some have called FATCA “unfair and outrageous,” demanding “the USA [come] into line with every other country in the world and stop taxing its citizens on citizenship, but [instead] on residence.” Director of Cayman’s Tax Information Authority Duncan Nicol was unavailable for comment, attending an OECD meeting in Europe, but it is unlikely his office will seek FATCA repeal. Experts have described 2010’s FATCA legislation as the first global tax-information legislation of its kind, forcing it to “come out with guns blazing in a sense,” one analyst said. FATCA has since been augmented, however, by 2013’s multilateral Mutual Administrative Assistance in Tax Matters, which Cayman joined in 2014, and is now among 108 signatories, and the same-year introduction by the OECD of global Common Reporting Standards, which Cayman signed only this year. The standards call on jurisdictions to gather information about account holders at local financial institutions, reporting it globally. “This new standard on automatic exchange of information will ramp up international tax cooperation, putting governments back on a more even footing as they seek to protect the integrity of their tax systems and fight tax evasion,” OECD Secretary-General Angel Gurría said at the time. In a footnote to the 100-jurisdiction listing, the OECD says the U.S. is “undertaking automatic information exchanges pursuant to FATCA from 2015” and “has entered into intergovernmental agreements with other jurisdictions to do so.” Those agreements, the footnote says, “acknowledge the need for the United States to achieve equivalent levels of reciprocal automatic information exchange with partner jurisdictions,” accompanied by “a political commitment to … advocate and support relevant legislation to achieve such equivalent levels of reciprocal automatic exchange.” Growing global regulation makes FATCA just one tax-reporting scheme among many. The Mutual Administrative Assistance convention alone “means certain information will go back to your home jurisdiction, and your tax man will give you a call if you haven’t reported it,” one legal expert said. And even if FATCA goes away, he said, “the Common Reporting Standards will kick in.” Article compliments IFC Review.
Cayman: FATCA repeal on agenda of US Republicans
Washington’s Foreign Accounts Tax Compliance Act, known as FATCA, will be assailed afresh as lawyers and lobbyists renew efforts to repeal the law as part of President Donald Trump’s tax reform, reports Cayman Compass. Washington-based Jim Jatras, a Republican and co-leader of the Campaign to Repeal FATCA, says “lots is happening,” and his group expects a Republican Congress to repeal the 2010 law by the end of this year. “The Republican leadership in both House and Senate, as well as the Trump administration, all know that their fortunes for 2018 depend on keeping a few do-or-die promises, such as repealing Obamacare, an infrastructure program and tax reform,” Mr. Jatras says. “They will find a way to do it. Our job is to make sure when that train leaves the station, FATCA repeal is on it.” Previous efforts to persuade the Obama administration were ineffective, he concedes, but says the November election of Mr. Trump and a Republican Congress have dramatically changed the landscape. “The legislative situation was very different from what it is today,” he told the Cayman Compass. “With both chambers of Congress and the White House controlled by the GOP, and strong language in the 2016 [Republican Party] platform favoring repeal, there’s a clear roadmap to repeal this year.” As early as January 2014, the Republican National Committee called for FATCA repeal. “There are questions about timing and what will be in the package, not whether there will be one,” Mr. Jatras said, calling it “a top priority” for “many interests.” Mr. Jatras was at the center of 2012 and 2013 lobbying efforts to repeal the law, which requires U.S. citizens and a broad range of U.S.-affiliated individuals and companies to declare their overseas income, paying taxes to the U.S. Internal Revenue Service. Up to 9 million people living overseas are estimated to be affected by FATCA, and as many as 6,000 in Cayman – more than 10 percent of the population – have obligations of some kind to the IRS. Mr. Jatras said, however, that looks set to change. In mid-February, Mr. Jatras and committee co-founder Nigel Green – head of U.S.-based financial adviser deVere Group – met members of Congress and “two influential assemblies of tax activist groups,” seeking to shape a tax package anticipated to be passed by the Congress this year.” He declined to name the groups, but said his committee had “been in touch with” both the House of Representatives’ powerful Ways and Means Committee and officials in the administration. “We are in contact with both. That’s all I can say for now,” he said. The organization’s repealfatca.com website says the five-member deVere delegation met Sen. Roger Wicker, Republican from Mississippi and co-sponsor of a previous repeal bill; Republican senator and 2016 presidential candidate Rand Paul of Kentucky, also sponsor of a previous repeal bill; Republican Rep. Mark Meadows of North Carolina, sponsor of a House repeal bill in the previous Congress; and Republican Rep. Thomas Massie of Kentucky, who joined Mr. Meadows in the repeal bill. According to repealfatca.com, the delegation also met with the Senate Budget Committee, described as “important for scoring FATCA repeal.” “The fight is now well and truly on to repeal this toxic, imperialistic and fatally flawed tax law,” Mr. Green said in a press release. “FATCA has wrecked [sic] havoc on the global financial system, turned 8 million Americans overseas into financial pariahs, violates other countries’ sovereignty, and is damaging for American jobs and therefore the American and global economies,” he said. He vowed immediately to submit a letter, signed by “numerous tax reform groups, spearheaded by the influential Americans for Tax Reform,” to “key Congressional leadership.” “FATCA repeal legislation,” he said, “will now definitely be introduced in the current Congress, in both the House and the Senate, in the next few weeks.” Mr. Jatras anticipates the tax-reform package would be introduced by July 4, although he conceded that efforts to repeal the Affordable Care Act are dominating congressional attention at the moment. “Repeal and replacement of Obamacare is, as they say, sucking all of the air out of the room right now. That doesn’t necessarily mean it will be prolonged. In any case, we need a little time to get FATCA repeal into a tax bill, so this is somewhat favorable to our campaign,” he said. Congress originally passed FATCA as part of a 2010 job stimulus package, Hiring Incentives to Restore Employment Act, created in the wake of the UBS banking scandal in 2009 that revealed U.S. citizens evading taxes by hiding deposits in Swiss accounts. The legislation required U.S.-affiliated persons and all foreign financial institutions to report U.S. depositors to the IRS under penalty of a 30 percent withholding “tax” on all transactions with the U.S. An online IRS database said Cayman registered 28,559 financial institutions under FATCA, nearly one-fifth of the global total. “We have confirmed that Sen. Rand Paul and Rep. Mark Meadows will soon reintroduce their repeal bills from earlier Congresses,” Mr. Jatras said. “We are conducting outreach to leadership and committees of jurisdiction on next steps. We are also looking at executive actions to nullify the IGAs. These initiatives are still in the early stages.” An IGA is an “intergovernmental agreement,” between the IRS and nearly 120 jurisdictions authorizing collection of tax information. On Nov. 29, 2013, Cayman became an early IGA signatory. The agreement can be unilaterally abrogated by either side with one year’s notice. “When the IGAs are nullified, or when FATCA is repealed,” Mr. Jatras said, “I think a lot of people are going to have some explaining to do,” including, he added, “why did they so meekly abrogate their domestic privacy laws … for many of their own citizens, not just Americans?” Article compliments IFC Review.
They’ve Only Just Begun, But Two Airlines Are Already Saying Adios to Cuba
It appears to be a case of too many cooks spoiling the broth – at least for two US airlines which are dropping its planned routes because they say with so many other airlines adding flights to the Spanish-speaking Caribbean nation, the routes are unprofitable. Silver Airways is dropping all nine of its planned routes by April 22, just six months after it started flying between Fort Lauderdale, Florida, and several Cuban cities. Low-cost carrier Frontier will follow suit on June 4, dropping its Miami-Havana route. After the US gave the nod to regular passenger flights to Cuba resuming about six months ago, for the first time in 50 years, US carriers rushed in to cash in on the expected boom in US travel to Cuba. But that has created a glut in airlift, and it’s not working out for some carriers. Silver spokeswoman Misty Pinson noted that the number of seats on planes between the US and Cuba tripled because the airlines added so many flights, many of them with big planes. “While the actual total number of passengers currently traveling to and from Cuba on all carriers combined is in line with what Silver originally projected, other airlines continue to serve this market with too many flights and oversized aircraft, which has led to an increase in capacity of approximately 300 percent between the US and Cuba,” she said. And spokesman for Denver-based Frontier, Jim Faulkner, said the airline was cancelling its flights because of heavy competition and higher-than-expected costs of providing service at the Havana airport. While larger airlines are still flying to Cuba, they have also cut back. American Airlines reduced daily flights to smaller cities in Cuba from 13 to 10 and switched to smaller planes on some flights, but kept its service to Havana intact; while JetBlue took out about 300 seats a day by using smaller planes. That is more a reflection of the glut in flights and not declining interest in travel to Cuba, according to statistics. About 285,000 tourists visited Cuba last year, up 76 percent from 2015, and the Cuban government says American visitors increased 125 percent in January. Article compliments Caribbean 360.com
Rich Chinese Race to Apply for a U.S. Golden Visa
As members of Congress in Washington debate raising the minimum required to obtain a U.S. immigrant investor visa from $500,000 to $1.35 million, concern about the hike has set off a scramble among wealthy would-be participants in China, reports Bloomberg. “Some clients are demanding that we make sure their applications are submitted before April 28,” the date the program expires unless extended or amended by Congress, said Judy Gao, director of the U.S. program at Can-Reach (Pacific), a Beijing-based agency that facilitates so-called EB-5 Immigrant Investor visas. “We’re working overtime to do that.” China’s wealthy, using not-always-legal means to skirt capital controls to get their money out and at the same time gain residency in the U.S., are continuing to dwarf all others as the largest participants in the EB-5 program, despite heightened measures by the Chinese government. The initiative channels money to high-profile U.S. real estate projects from New York to Miami to California — including those by the family of Jared Kushner, President Donald Trump’s son-in-law and senior adviser. A current plan by the Kushner family to refinance and reconstruct its New York office building at 666 Fifth Avenue is seeking $850 million in EB-5 funding, as well as cash from Anbang Insurance Group and other investors, according to terms of the proposal reported by Bloomberg News. A spokesman for Kushner Cos. declined to comment. 200,000 Jobs At stake if the EB-5 is curtailed is a program estimated to have played a role in creating at least 200,000 U.S. jobs and drawing as much as $14 billion from Chinese investors alone, based on data provided by Rosen Consulting Group and the Asia Society. Past projects taking advantage of EB-5 include New York’s Hudson Yards, Hunter’s Point Shipyard in San Francisco, and a Trump-branded tower in Jersey City. New projects recently doing the rounds in China’s chat rooms, web forums and hotel-ballroom investor seminars include a 5-star hotel complex in Palm Springs, California, and what’s touted as “the world’s tallest residential building,” on New York’s 57th Street, known as Billionaires’ Row. Because Chinese individuals are limited to exchanging $50,000 worth of yuan a year, a 10th of what the EB-5 program requires, some agents are advising clients who don’t already have assets offshore to use a means nicknamed “smurfing” to move their money. “Our suggestion to the client is to open three to four personal accounts in the U.S. or line up three to four friends’ accounts, so they can split the money and wire it to different personal accounts without being put on a blacklist by the Chinese authorities,” said a Shanghai-based real estate agent who gave the surname Dong. “It may require a trip to the States to do so to facilitate the process.” Chinese Dominate the EB-5 Investor Visa Program While the government in Beijing spent much of 2016 working to stop its citizens sending money abroad in order to stabilize its declining currency and foreign reserves, Chinese investors’ use of EB-5 continued anyway, totaling $3.8 billion in the fiscal year that ended Sept. 30, according to data from the U.S. State Department. EB-5 started decades ago as a way to create jobs in needy U.S. neighborhoods by attracting foreign investment. But it has run into political opposition amid charges the program is benefiting billionaire developers and being dominated by wealthy Chinese. “EB-5 has been a key program for capital flight that has been abused by Americans and Chinese people seeking to game the system,” said Andrew Collier, an independent analyst in Hong Kong and former president of Bank of China International USA. While there’s no suggestion of wrongdoing by developers that receive funding from EB-5, a series of Securities and Exchange Commission cases against EB-5-linked immigrant investor centers led the U.S. Citizenship and Immigration Services to announce last week that they would audit the centers amid concern about fraud. Dwarfing Others Chinese investors, several thousand a year, have made up as much as 85 percent of the annual EB-5 investor total, according to U.S. data provided by Rosen Consulting and the Asia Society. In 2015, China overtook Canada as the biggest foreign buyer of U.S. homes. Changes to the EB-5 minimum would affect property developers who rely on the program as a funding channel, said Michael Shaoul, chief executive officer at Marketfield Asset Management in New York. “Any interruption of the program or reduction in Chinese participation would have a meaningful effect on a development cycle that is already showing signs of strain in certain key U.S. cities,” he said by email. Investment in an EB-5 project in New York, a hotel near Central Park, allowed Shanghai resident Kevin Tai to move to the U.S. this month. He applied with his family for the investor visa at the end of 2013. Transferring more than $50,000 abroad every year was also prohibited then, so to pony up the cash, Tai used his Shanghai home as collateral to secure a $500,000 loan from Hang Seng Bank in Hong Kong, a faster route to getting cash than trying to get yuan over the border in batches. That route is now closed as well. “I don’t recall what return rate they promoted, because that doesn’t matter,” he said just before his departure. “For most EB-5 applicants like us, the purpose is to get a permanent Green Card.” Palm Springs The project in Palm Springs being promoted via messaging app WeChat by Dong’s firm seeks Chinese EB-5 investors for a $155 million hotel. It offers an unusually high expected annual return of 12 percent. By fronting a minimum of $500,000 for the 26-villa development, prospective investors become eligible to apply for a Green Card, the promotion says. The majority of EB-5 investments offer very low returns in the range of 0.25 percent to 0.5 percent, said Can-Reach’s Gao. The Central Park Tower project, now under construction by the New York-based luxury condo builder Extell Development Co., will reach 1,550 feet (472 meters) and house a Nordstrom department store as well as “ultra-luxury” residences, according to the architect’s website. A previous downtown New York condo project by Extell, One Manhattan Square, also received funds from EB-5 and initially targeted Asian buyers. The latest Extell tower was pitched last year to packed rooms of investors in four Chinese cities: Shanghai, Beijing, Shenzhen and Nanjing. Packed Rooms About 900 firms in China are registered to handle emigration, and most of them offer EB-5 services. To be sure, the overall volume of money leaving China through the EB-5 channel is small — just half a percent of the $728 billion estimated by Standard Chartered Plc to have flowed out in 2016. While capital outflows have fallen sharply in recent months as regulators increase scrutiny and the yuan holds steady, analysts say there’s pent up pressure to move money out of China. That’s why the State Administration of Foreign Exchange, the currency regulator, has been closing loopholes that allow money to be illegally channeled overseas by seeking extra disclosure. Outflows moderated in February as foreign exchange reserves rose, reversing a seven-month losing streak. Restrictions include limits on overseas investments and acquisitions, seeking more details from citizens looking to use their $50,000 quota and limits on purchases of investment-linked insurance products in Hong Kong. Another Rush A slew of external risks could trigger another rush to get money out. If the Federal Reserve lifts interest rates quicker than anticipated, it could drive up the dollar, prompting outflows. “Demand is strong to get money out,” said Pauline Loong, managing director at research firm Asia-Analytica Pte. in Hong Kong. The problem, though, will likely remain how to bypass authorities seeking to rigidly enforce currency rules, said Dong, the Shanghai agent. “The biggest obstacle now is how to get $500,000 out,” he said. And especially so if the U.S. Congress acts next month to more than double the minimum EB-5 investment. Article compliments IFC Review.
Stocks sink as ‘Trump trade’ flips into reverse
Stocks around the world sank Monday on worries that the Trump White House may not be able to help businesses as much as once thought. Many of the trends that have been in place since Election Day went into sharp reverse: The dollar’s value sank against other currencies, as did bank stocks, while prices jumped for Treasury bonds. KEEPING SCORE: The Standard & Poor’s 500 index fell 15 points, or 0.6 percent, to 2,329, as of 10:25 a.m. Eastern time. The Dow Jones industrial average lost 141, or 0.7 percent, to 20,445. The Nasdaq composite dropped 29, or 0.5 percent, to 5,799. Small-company stocks, which have outpaced the rest of the market since the election, fell even more. The Russell 2000 index sank 14 points, or 1.1 percent, to 1,340. The stock market had been on a nearly nonstop rip higher since Election Day on the belief that President Donald Trump and a Republican-led Congress will cut income taxes, loosen regulations for companies and institute other business-friendly policies. Besides stronger economic growth, investors were also predicting higher inflation would be on the way. But last week’s failure by Republicans to fulfill a pledge they’ve been making for years, to repeal the Affordable Care Act, raises doubts that Washington can push through other promises. The House on Friday pulled its bill to revamp the country’s health care system, when it was clear that it didn’t have enough votes to pass. DOLLAR DUMP: The dollar fell against most of its major rivals, including the Japanese yen, euro and British pound. The ICE U.S. Dollar index, which measures the U.S. currency’s value against six others, has given up nearly all of its big gains since Election Day. The dollar fell to 110.38 Japanese yen from 110.80 late Friday. The euro rose to $1.0883 from $1.0808, and the British pound rose to $1.2593 from $1.2500. YIELDS DROP: The yield on the 10-year Treasury fell to 2.36 percent from 2.41 percent late Friday. That’s close to its lowest level in a month. It was above 2.60 percent just a couple weeks ago. BANKS SINK: Bank stocks have tracked the movements of Treasury yields recently, because higher interest rates would allow them to charge more for loans and reap bigger profits. Financial stocks in the S&P 500 dropped 1.4 percent, the largest loss among the 11 sectors that make up the index. AN ANXIOUS MARKET: The VIX index measures the market’s nervousness by looking at how much traders are paying to protect against upcoming drops in the S&P 500. By that measure, investors early Monday were feeling the most jittery since mid-November, shortly after Election Day. The VIX jumped 10 percent. HEALTHY GAINS: Among the few gainers on the day were hospital stocks. The Republican health care plan would have resulted in 24 million additional uninsured people in a decade, according to a tally by the Congressional Budget Office. And hospitals take care of patients, whether they’re insured or not. HCA Holdings jumped $4.05, or 4.7 percent, to $90.09 for the biggest gain in the S&P 500. Universal Health Services rose $5.14, or 4.2 percent, to $127.03 for the second-largest gain. GOLD GLITTERS: The price of gold rose $7.20 to $1,255.70. Silver rose 31 cents to $18.06 per ounce. Copper, whose price tends to rise and fall with expectations for economic growth, fell 6 cents to $2.58 per pound. MARKETS ABROAD: Stocks were weak around the world. In Asia, Japan’s Nikkei 225 index dropped 1.4 percent, South Korea’s Kospi index lost 0.6 percent and the Hang Seng in Hong Kong fell 0.7 percent. In Europe, the German DAX lost 0.9 percent, the French CAC 40 fell 0.4 percent and the FTSE 100 in London dropped 0.9 percent. OIL: Benchmark U.S. crude fell 70 cents to $47.27 per barrel. Brent crude, used to price international oils, lost 63 cents to $50.29. Article compliments LOOP News Barbados.
Oxfam exposes tax haven habits of big European banks
The EU’s fight against tax evasion is far from over. After a series of tax evasion scandals concerning European countries and companies in recent years, the NGO Oxfam on Monday published a damning report on the conduct of European banks, reports Euractiv. Using data from country by country reporting, a transparency requirement recently established under EU law, the NGO put the activities of Europe’s 20 biggest banks under the microscope. “New EU transparency rules give us a glimpse into the tax affairs of Europe’s biggest banks and it’s not a pretty sight,” said Manon Aubry, the head tax justice campaigner for Oxfam France and author of the report. Oxfam’s findings reveal flagrant abuses. The banks analysed declare 26% of their profits in tax havens, but just 12% of their revenue and 7% of their employees. For the NGO, this gap between real activity (number of employees and turnover) and declared profits is proof that the banks knowingly shift their profits to low taw jurisdictions. “The 20 European banks declare €628 million in tax havens where they employ no staff and €383m of profits on which they pay not a single euro in tax,” the report stated. Real activity The gap between banks’ real activities and their profits can sometimes reach incredible proportions. In the Cayman Islands for example, “for every €100 of revenue, there is an average of €167 profit”. By shifting their profits to attractive tax jurisdictions, some of which even offer zero-rate deals, some European banks have managed to achieve negligible effective tax rates. Barclays, the fifth largest bank in Europe, declared profits of €557m in Luxembourg, which Oxfam classifies as a tax haven, but only paid €1m in tax. “The results of this report, some of which defy understanding, show the extent of the problem of the total impunity surrounding Europe’s largest banks in tax havens. The scandals keep on coming and still the banks do not seem to change their practices,” said Aubry. Tax havens in the heart of Europe The report focusses on European tax havens, like Ireland and Luxembourg, where five banks (RBS, Société Générale, UniCrédit, Santander and BBVA) manage to book profits higher than their revenues. At €39m, Société Générale’s Ireland profits for 2015 were more than four times higher than its €9m revenue. “While there may sometimes be reasons for high profits in some countries, these kinds of results indicate the potential shifting of profits to Ireland,” the report said. Oxfam based its calculations on data available from country by country reporting, which obliges banks to publish a certain amount of information on their activities: the number of branches and the nature of their activities, turnover, staff, profits or losses before tax, the amount of tax paid and public subsidies received. This obligation was introduced in France in 2013, before being taken up at European level later the same year. “It would have been impossible to shed light on the practices of European banks in tax havens without these new transparency obligations,” said Aubry. Access to this new information has made it easier to check whether profits are really made in the jurisdiction where they are declared, and not shifted to optimise the company’s tax bill. Country by country reporting requirements currently apply only to banks. An EU directive is being negotiated in the European Parliament, with the aim of extending the requirements to multinationals across all sectors. But in France, an attempt to force multinationals to publish their tax bills was struck down by the Constitutional Court. The country’s top judges found that the transparency requirement undermined companies’ freedom to do business. Non-existent tax havens black list The definition of a tax haven varies from one country to another. In France, the list of non-cooperative territories offers rather meagre reading: in 2011 it contained 16 countries but had been pared down to just eight in 2016. At European level, the creation of a common list of tax havens is currently being discussed. But the exercise is an almost impossible political balancing act, because no EU member state will figure on the list. Yet, there is no shortage of EU jurisdictions offering highly favourable rates for multinational businesses. As a result, Oxfam did not rely on the official list of tax havens but instead compiled its own information from different sources, including the OECD and the European Parliament, ending up with a list of 31 countries. BACKGROUND An updated directive on the automatic exchange of information between national tax administrations received the green light from the EU’s 28 finance ministers. So-called ‘country-by-country reporting’ between national tax authorities is opening a new era in tax transparency, backers said. The 4th Directive on Administrative Cooperation (DAC4), adopted on 8 March 2016, will require multinationals to report, among other things, on their revenues, profits, taxes paid and number of employees in every country where they operate. The Panama Papers exposed offshore companies used to avoid tax, and has embroiled figures including Vladimir Putin, Ukrainian President Petro Poroshenko, UK Prime Minister David Cameron, Icelandic Prime Minister Sigmundur Davíð Gunnlaugsson, and Climate Commissioner Miguel Arias Cañete. It comes at a time when tax avoidance is high on the political agenda. The fight against tax evasion is one of the Juncker Commission’s main priorities. News of the systematic, state-sanctioned tax evasion practices of many multinationals based in Luxembourg, known as the Luxleaks scandal, broke shortly after the new Commission was sworn in. On 18 March 2015, the executive presented a package of measures aimed at strengthening tax transparency, notably by introducing a system for the automatic exchange of information on tax rulings between member states. Article compliments IFC Review.
Save the Date: BIBA Networking Mingle (June 24th, 2016)
The Barbados International Business Association will be hosting its third Networking Mingle on June 26th, 2016. Further details to come closer to the event.
Save the Date: BIBA Networking Mingle (April 22nd, 2016)
The Barbados International Business Association will be hosting its second Networking Mingle of the year on April 22nd, 2016. Further details to come closer to the event.
Save the Date: BIBA Networking Mingle (June 24th, 2016)
The Barbados International Business Association will be hosting its third Networking Mingle on June 26th, 2016. Further details to come closer to the event.
Statement On The Barbados Economy
Ladies and Gentlemen of the media, colleagues, fellow Barbadians listening to this media conference over the various broadcast systems, a pleasant good afternoon to all of you. Let me begin by expressing on behalf of the Ministry of Finance and Economic Affairs our sincere wishes for a healthy, productive and rewarding 2017 to all Barbadians. I would like in particular to register our appreciation for your support and cooperation during the course of the past year. Not unlike many other countries across the world 2016 was one of mixed fortunes for Barbados. On the one hand we witnessed an acceleration of real growth in our economy with an estimated 1.6 % expansion in the GDP, when compared to the 0.8 % level of growth in 2015. Indeed, this is the first year in which all major economic sectors, led by a resurgent tourism sector registered positive growth in the same year since the great global financial crisis of 2008. At the same time low inflation, a continuing decline in the rate of unemployment, and a seeming pick up in foreign direct investment albeit muted, painted positive signs that the recovery in the real economy was not a passing sensation, but an indisputable fact that a real economic turnaround was beginning to set in… To download the full statement from Minister of Finance and Economic Affairs, Christopher Sinckler, please click here. Article compliments BGIS.
Mr. Gregory McConnie – President’s Address BIBA Luncheon Seminar July 22, 2016
President’s Address BIBA Luncheon Seminar July 22, 2016 by Mr. Gregory McConnie BIBA President Protocol having being established, good afternoon ladies and gentlemen and thank you for joining us for our luncheon seminar. It gives me great pleasure to greet all of you this afternoon. I must truly thank Senator the Hon. Darcy Boyce for taking the time out to engage and inform us about the function of his new role, the approaches he intends to employ, as well as receive feedback on the very serious issues affecting the way business is done in Barbados. The topic is a timely one as business facilitation is in our view the most pressing issue to be addressed. We see two main elements to business facilitation, certainty of process and agility. All users of services provided by both the private and public sectors require consistency and certainty of process in order to be able to effectively manage their affairs. This means having timeframes within which transactions are processed and delivering on them, every time. This is particularly important for the international investor where Barbados is competing against other jurisdictions for their business. Barbados must demonstrate that it can meet the high standards of service expected by international business investors and practitioners, and that it can do so consistently if it is to continue to be perceived as a high quality jurisdiction. Agility, the other aspect of business facilitation that is vital to being able to compete effectively for international business, includes initiating and implementing legislative changes and effecting the relevant business process changes in relatively short timeframes after new legislation is passed. While other jurisdictions have been able to implement new initiatives quickly, like the new LLC legislation recently passed in the Cayman Islands and similar legislation planned for Bermuda, in Barbados the Private Trust Companies and Foundations vehicles legislation have been passed but still cannot be utilized and the implementation of Incorporated Cell Company legislation has not been smooth. Our timeframes for execution must be measured in days and weeks rather than months and years. Wherever there is adversity there is generally also opportunity, and amongst the externally imposed challenges arising from BEPS, the Panama Papers and “de-risking” opportunity lies. There is no doubt in my mind that the IB Sector in Barbados can take advantage of these to expand and grow exponentially under the right conditions. However, we need to step up our game if we are to really take advantage of the opportunities available. Just this week the Central Bank of Barbados released its review of Barbados’ economic performance for the first six months of 2016. Part of the review stated that there was a 3 percent decline in the number of international business and financial services (IBFS) licenses granted during the first half of the year. Of course we know that this statistic by itself is not cause for alarm because many new companies doing international business are opting to operate as regular Barbados companies to take advantage of our tax treaties, rather than as licensed entities. However, one of the main statements made by Central Bank Governor Dr DeLisle Worrell which stood out was that Barbados’ foreign exchange reserves fell by a further $43 million to $884 million. It has fallen consistently over the past 5 years by about 40% from the 2011 levels of $1.4 billion. It should be known by now that the international business sector is the most reliable and consistent earner of foreign exchange for Barbados. This sector contributes has been $1billion to Barbados Gross Domestic Product annually. That is all foreign exchange because this sector earns no revenue from Barbados. Again, there is potential but we need to address business facilitation issues first and we need to address them immediately. Therefore, BIBA welcomes the recent appointment of Senator Boyce to provide that dedicated effort towards reducing, if not eliminating, the difficulties currently being experienced in doing business on this island. In support of Senator Boyce’s business facilitation role, BIBA intends to work collaboratively with the key Government departments to ensure that everyone involved understands the potential that the IB sector holds for Barbados’s growth, while we seek to understand the challenges those departments face when interacting with the private sector and share with them the challenges the private sector encounters, with the intention of working together to develop solutions to the issues identified. As a nation celebrating 50 years of independence we need to commit ourselves to making Barbados the easiest place for doing business in the world. This is not just the responsibility of the government but it should be a national commitment so that every man and woman sees himself or herself as having a responsibility for making this a reality and will approach their work whether it be in the private or public sector with a mindset that says I am helping to generate business activity in my country that will lead to the creation of jobs, and the generation of government revenues that will go towards financing healthcare, education and other social programmes. Thank you for your time and interest.
MR ANDREW ALLEYNE – PRESENTATION AT 2016 IBFS CONFERENCE
International Business and Financial Services Conference Wednesday, March 16th, 2016 WELCOME REMARKS Mr Andrew Alleyne, President of BIBA 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 Conference. Each year, BIBA is pleased to support the Central Bank of Barbados in its efforts to bring together representatives from both the public and private sectors that are key to the success of this sector, to dialogue and share views on how to further advance our collective goals. The theme for this year’s conference Reflecting on the Past: Planning for the Future, is a timely topic in light of the ongoing celebrations of 50 years of Independence. It is important for us to reflect on the history of the international business and financial services sector and its immense economic and social contribution to the Barbados economy. We will hear more about the sector’s contribution from Mr. Downes later. It is this sector’s level of importance that should drive each and every one of us to continuously examine the business environment, highlight the challenges faced, and work together to find workable solutions. The issue of banks “de-risking” was raised at last year’s conference and has since developed into a major concern for the Caribbean region. The origin of this problem lies within the enacting of new international regulations intended to address money laundering and the financing of terrorism. It also requires international correspondent banks to be satisfied that their “front line” banks are also undertaking the same level of due diligence and that they know their customers. As recently as last week, the United States Comptroller of the Currency (Thomas Curry) announced that OCC may create new guidance to deal with de-risking. In his March 7th speech he said the Office of the Comptroller of the Currency is collecting data on banks de-risking decision-making processes. He said “Our goal is to identify current practices and possible gaps in existing policies and procedures for conducting periodic client risk evaluations and for making account termination decisions”. While it is too early to speculate if the OCC’s involvement will improve the decision making process, the Agency might require banks to conduct enhanced due diligence tests that require input from Senior Management before breaking ties with a foreign correspondent. To further add fuel to the fire, the Caribbean has been unfairly branded as “high risk” and as a result some of these banks have started to withdraw their correspondent relations to the Caribbean. Look at Belize! The larger banks have already severed relationships with banks there, the first being the Belize Bank, and subsequently other indigenous banks. This forced a closure of several indigenous banks leaving many businesses and individuals without a means to receive or make international payments. Western Union has withdrawn its services in the Bahamas, Cayman and the Turks and Caicos. As a result Fidelity Bank has closed its Western Union accounts in the Bahamas and the Cayman Islands. Closer to home an Antigua bank, CUB recently lost its correspondent banking support when a US correspondent bank terminated its relationship. In Jamaica, Barclays has advised the Jamaica National Building Society that it will be terminating its correspondent relationship on April 1st. In some instances the decision to withdraw correspondent banking services is based on low business volumes or low revenues. However, the focus on the Caribbean is not based on an objective assessment of the region’s risk, but reflects a lack of understanding of the region by risk managers who are largely unfamiliar with the Caribbean’s high regulatory and compliance standards. Last December, BIBA’s First Vice President, Gregory McConnie, and I attended a roundtable discussion hosted by the Financial Stability Board, the World Bank, the International Monetary Fund and the Central Bank of Barbados. The discussion focused on global initiatives to lower the risks associated with correspondent banking. These included the work international standard setters are undertaking to better measure, understand and address the challenges presented by the reduction of these important banking services. Another issue of concern to all of us is business facilitation. Unlike the withdrawal of correspondent banking services, this is an issue that is within our power to fix. There is now a greater need to improve our country’s ranking in the World Bank’s “Ease of Doing Business” index, especially given that the international business sector is losing some of its competitiveness due to new and expanding tax transparency laws and regulations in North America and Europe. On a more positive note, the TMF Complexity Index recently ranked Barbados 7th, in terms of “Ease of doing business” a significant improvement from the precious year when we were ranked 22nd. Within the Americas, Barbados was ranked an impressive 4th as a location to conduct business. Ease of doing business is critical for the sector to grow. We must continue to find ways of improving efficiency within our public and private sectors in order to enhance the attractiveness of Barbados as a jurisdiction from which to conduct business. It is hoped that through this conference, we can find a workable plan of action. Thank you for your attention.
New Location for BGIS, FTC
Members of the public are advised that the Barbados Government Information Service (BGIS) has relocated to the Old Town Hall Building, Cheapside, Bridgetown, and has changed its telephone numbers. The PBX is now 535-1900, while the Chief Information Officer may be reached at 535-1917. The Deputy Chief Information Officer may be contacted at 535-1939, and the BGIS’ new fax number is 535-1937. Additionally, effective Monday, March 13, the offices of the Fair Trading Commission (FTC) will be temporarily relocated to the 2nd floor, Cedar Court, Wildey, St. Michael. The FTC’s telephone number remains 424-0260. Article compliments Invest Barbados.
Canada’s Only Captives & Corporate Insurance Summit
BIBA is delighted to be a partner with the 13th Annual Canadian Captives & Corporate Insurance Strategies Summit. Risk Managers: Maximize Insurance ROI, Mitigate Risks and Reduce Costs It is the must-attend event for risk managers, current and prospective captive owners, captive managers, and others working in risk management and corporate insurance. Whether you’re just considering a captive or looking to fine tune your captive strategy, this conference has something to offer you. Keep abreast of regulatory changes, tax updates and innovative investment strategies. Learn and network with industry experts including: Gary Pearce, Vice President Risk Management, Kelly Services Inc. Bruce Langille, Managing Director of Risk Management & Security Services, Province of Nova Scotia Cynthia Johansen, Registrar/CEO, College of Registered Nurses of British Columbia Zach Finn, Director, Davey Risk Management & Insurance Program, Butler University Dan Kugler, VP Enterprise Risk Management, The REV Group Develop a blueprint to realize cost savings, maximize insurance ROI, investigate domicile opportunities and much more! Ensure you know how to enhance your insurance risk capabilities. Download the Brochure Now Register with VIP Discount Code BIBA20 to receive 20% off registration* View Speakers Register Now Why Attend To register or ask a question: Call: 1 (866) 298-9343 x 200 Email: firstname.lastname@example.org Website: www.captivesinsurance.com See you at the Summit! The BIBA Team Follow the summit on Twitter: @RiskInsuranceCA Join the LinkedIn Group: Canadian Captives & Corporate Insurance Strategies *Discount cannot be used in conjunction with any other offer and is only valid on new registrations
STATEMENT FROM THE BARBADOS PRIVATE SECTOR ASSOCIATION FOLLOWING THE SOCIAL PARNTERSHIP MEETING ON FRIDAY MARCH 4 2017
The Barbados Private Sector Association (BPSA) has for many months expressed its concern about the financial situation facing Barbados and therefore welcomed participation in today’s meeting of the Social Partnership on the economy of Barbados held at the Lloyd Erskine Sandiford Centre. Following an informative presentation by the Acting Governor of the Central Bank, Cleviston Haynes and submissions by the Prime Minister and other leaders of government, labour and the private sector, the BPSA is encouraged that the parties have come to consensus on the seriousness and urgency of the financial situation and agreement to jointly chart a path forward. The BPSA firmly believes that we must collectively move beyond talk to establish and implement clear strategies and action plans for recovery which will be critical to building confidence within the local private sector and the general public and externally among investors and the international financial community. It is also our hope that each citizen can be inspired to play their part in a recovery for their own benefit and that of our beloved country. In today’s Meeting of the Social Partnership there was consensus that the downward trajectory of the foreign reserves and the persistently high fiscal deficit should be prioritised for immediate action. Two working groups were set up to deal with these two matters, and the BPSA has assigned representatives. In this regard, Roseanne Myers, President of the Barbados Hotel and Tourism Association and Donna Wellington, President of the Bankers’ Association have been appointed to the Foreign Reserves Working Group while David Small from the Banking Sector and Charles Herbert, Chairman of the BPSA will serve on the Fiscal Deficit Working Group. The BPSA is also committed to participating in the proposed Economic Advisory Council, if asked and six Efficiency Teams under the Barbados /Competitiveness Action Team Framework to look at operating efficiency within various Government departments. It was agreed that these working groups which met immediately following today’s morning session will provide analysis and report back to the Chairman of the Social Partnership thereafter to produce recommendations for further action. The recommendations will go to Cabinet within two weeks with the first recommendations and continue of Barbados for immediate consideration and response. The BPSA stands ready to support implementation wherever possible.
BIBA Director awarded Vice-President designation from RBC Dominion Securities
Congratulations BIBA Director Mr N. Elliott Barrow on being awarded the Vice-President designation from RBC Dominion Securities. This prestigious designation recognizes Elliott’s long-standing success and his commitment to client satisfaction and performance. Please see the official Press Release here.