The Bahamas possesses an outstanding infrastructure for commercial and industrial activity, and offers a highly-skilled workforce. The professional community of accountants, international bankers, trustees, and investment specialists is large, diverse and highly skilled. There is also a full complement of respected and experienced law firms.

When the Progressive Liberal Party (PLP) was elected to form the government in May 2002, one of the first actions taken by Prime Minister Perry Christie was the establishment of the Ministry of Financial Services and Investments. For the financial services industry in the Bahamas it was welcome and long overdue recognition of the importance of this sector to the Bahamian economy and the co-operation that must exist between the public and private sector.

Dialogue and consultation with the private sector have been the watchwords of my ministry since I was honoured with the appointment as the country’s first minister of financial services and investments. 

PRIVATE SECTOR DIALOGUE

We have entered a new era as a nation, an era in which full consultation and true co-operation with all sectors of Bahamian society has been accepted as the way forward. Just as no man is an island, no government, once elected, can say it is acting responsibly and without full accountability, if it does not engage all constituents on a continuous basis in developing policies and legislation that are in keeping with the best interests of the country. This is the spirit in which my ministry approached our consultations. We regard the private sector as partners in national development.

The Bahamas is in the enviable position of having an economy based on two of the fastest growing industries in the world – tourism and financial services. Both face considerable challenges in today’s global economy. Consumers now have more choices than they have ever had before on where to spend their vacation dollars. Similarly, the once quiet, unnoticed world of financial services has become the focal point for international attention and increased global competition. The end result is that people and capital can move freely and instantaneously in an environment of unprecedented choice when it comes to where they want to vacation or do business.

As a service-based economy, the Bahamas will succeed in its two primary sectors of tourism and financial services by recognising, embracing and nurturing two simple operating principles in everything we do – providing value for money and providing top quality service. They are inter-dependent, not mutually exclusive principles.

Evidence of our commitment to ongoing dialogue and cooperation with the private sector is the recent establishment of the Financial Services Consultative Forum. Membership consists of individuals with wide ranging business expertise who are committed to the Bahamas’ continued success as a financial services centre. Its mandate is to advise my ministry and the government on the state of our financial services sector, the impact of competing jurisdictions and to recommend strategies, legislation and products that will better position the Bahamas as a cutting edge financial centre.

A STRATEGY FOR FINANCIAL SERVICES

We have also now established a National Strategy for Financial Services, the outcome of extensive liaison with the private sector and others with a stake in the financial services industry.

The strategic plan has two goals: to create a sustainable, well regulated, and cooperative financial centre; and to expand and diversify the economy.

What are the guiding principles behind these goals? First and foremost the Bahamas is a financial services centre, not an offshore financial centre, as some would describe us. The distinction is crucial. 

As citizens of the world and as a country committed to honouring its international obligations, we shall engage in constructive dialogue with our partners and our competitors. Like the Organisation for Economic Co-operation and Development (OECD) countries, we are blue chip, well regulated and cooperative. Like them, we offer financial services. Like them we provide services to persons who wish to engage in prudent fiscal planning. We believe that as believers in competition they would wish to compete on a level playing field with the same rules applying to all players. 

My government has already indicated that it will do nothing to put the Bahamas at a competitive disadvantage. Indeed, in a world where OECD countries are seeking to remove trade barriers, we welcome the opportunity to compete alongside them on a level playing field. We want our citizens and all those within our boundaries and all of our competitors to understand that we look to the standards adhered to by London, New York, Singapore, Geneva and other ‘onshore centres’ where the majority of ‘offshore’ business is conducted.

Similarly as we compete with other financial centres, we recognise the fact that the quality of our services must be at least at the same level of international standards as those jurisdictions. 

We have established a ten point action plan to achieve the goals in National Strategy for Financial Services:

Create a productive public and private sector partnership.
Replace red tape with red carpet.
Identify and create opportunities for growth.
Safeguard our internal environment and expand/upgrade our infrastructure.
Develop expertise.
Promote the jurisdiction.
Build strong relationships with relevant international bodies.
Facilitate integration in the industry.
Develop linkages with tourism, investment, real estate and property development.
Facilitate Bahamian participation in the industry.

While we are moving forward with all elements of this strategy, we have been particularly mindful of the need to minimise bureaucracy and red tape for those who must deal with government agencies. Our message should be clear: we are committed to facilitating business. A prime example of this commitment is the plan to fully computerise the Companies Registry so that company names may be reserved and companies formed, annual returns filed and payments made for anywhere in the world. The entire registry will be fully computerised over the next 24 months.

A STRATEGIC PLAN FOR INVESTMENTS

A National Strategy for Investments has also been developed which will see us double our efforts to welcome international and local investors in the Bahamas. These efforts will focus on hotel and resort development, time share projects, real estate initiatives, strategic economic expansion and incentives for Grand Bahama and the Family Islands and the encouragement of investment in local capital markets and international companies which benefit the Bahamas.

Similar to financial services, our investments strategy is based on a commitment to dialogue and consultation with international and Bahamian investors to ensure a harmonious environment in which the private sector can flourish. These commitments include: revising our National Investment Policy to reflect today’s realities; expediting the processing of completed applications within 30 days; closer collaboration with government agencies on the implementation of approved investment projects; providing equal incentives to all investors; and maintaining our competitive tax environment.

GOING FORWARD

The Bahamas commitment to compete with top financial centres and thereby ensure the quality of our jurisdiction has been demonstrated by our commitment to strong regulatory and supervisory infrastructure. Our active participation in international agencies such as the OAS, CARICOM and The Commonwealth provides mechanisms to adhere to international standards. We continue to signal our willingness to operate within negotiated parameters for the global delivery of financial services by ascension to the World Trade Organisation (WTO) and the Free Trade Area of the Americas (FTAA).

These actions underscore a simple, fundamental fact – participation by the Bahamas in financial services is critical to our economic future. We are building a sustainable, viable hub of finance with this future in mind.