Hon. Allyson Maynard-Gibson, M.P.
Minister of Financial Services and Investments
*”The Government’s 5 Year Strategic Plan recognises the need for The Bahamas to “deepen its bench” if it intends to remain strong and grow”*
So said Minister Maynard-Gibson addressing the concluding Seminar during Accountants Week, sponsored by the Bahamas Institute of Chartered Accountants (BICA). She spoke broadly on the Challenges of the New World and specifically the future of financial services.
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 it does, said the Minister. As a service-based economy in a very competitive world, The Bahamas must provide (a) value for money and (b) top quality service – two inter-dependent, not mutually exclusive principles.
**Financial Services Strategy**
Referencing the draft National Strategy for Financial Services, prepared in consultation with the financial services industry, including BICA, the Financial Services and Investments Minister pointed to two primary goals and a ten-point action plan.
1) To sustain a successful, blue chip, well-regulated and co-operative financial centre; and
2) To expand and diversify the economy.
Ten-Point Action Plan:
1) Create A Productive Public and Private Sector Partnership
2) Replace Red Tape With Red Carpet
3) Identify And Create Opportunities For Growth
4) Safeguard Our Internal Environment And Expand/Upgrade Our Infrastructure
5) Develop Expertise
6) Promote the Jurisdiction
7) Build Strong Relationships With Relevant International Bodies
8) Facilitate Integration In the Industry
9) Develop Linkages With Tourism, Investment, Real Estate and Property Development
10) Facilitate Bahamian Participation in the Industry
*”I wish to make it clear that The Bahamas is a financial services centre, not an offshore financial centre, as some would describe us. The distinction is crucial,”*said the Minister, adding that this was the guiding principal behind the goals and action plan.
**Preventing System Abuse**
Noting the confidence expressed by the private sector that for the foreseeable future The Bahamas will remain strong in private banking, the Minister pointed out that the global financial system can only be strong if all participants join the fight against money laundering and terrorist financing.
This means that the way private banking has been conducted in the past will rapidly change all over the world. *”Whilst most developed systems respect privacy, they also expect transparency of mode of operations and a means by which those who seek to abuse the system may be prevented, swiftly detected and swiftly punished.”*
The Bahamas takes pride in being a blue chip, well-regulated and cooperative financial center. Speaking at the international firm Moore Stevens’ Partners Conference hosted in The Bahamas recently, the Minister had said the nation’s commitment to protection of personal privacy, cannot be confused with protection for illicit activity. *”We cooperate with our friends in making every effort to eliminate money laundering from our banking systems and to discover and bring to justice all involved in terrorist financing. In 1996, the Bahamas criminalised money laundering – one of the first international financial centers to do so. This law was firmly supported by international banks here, that formally introduced into their codes of conduct in the 1980s adherence to international KYC best practices. Further, our legislative adjustments of 2000, placed The Bahamas as a pace setter in ensuring transparency through comprehensive KYC systems and respecting the privacy of clients as supported by UN principles.”*
**Legislation and Regulation**
BICA members and guests were told that the 5 Year Strategic Plan recognises the need for The Bahamas to “deepen its bench” if it intends to remain strong and grow.
Accordingly, new legislation will be tabled in the near future to enable The Bahamas to provide new and better services and products, such as E-commerce, Captive Insurance, Foundations, Protected Cell Companies, Pensions Legislation, Aircraft Registry, and Arbitration Centre.
Regulation of the sector will also remain strong and will become more transparent. Industry Regulators already have executed a Memorandum of Understanding, which seeks to ensure co-ordination with on-site inspections and acceptance of due diligence completed by other regulatory bodies.
The Bahamas financial services industry now has 4 primary regulators and 1 supervisory body – Central Bank of The Bahamas, Securities Commission of The Bahamas, Registrar of Insurance, Inspector of Financial Services & Investors and the Compliance Commission.
*”Long term sustainability of the industry means that The Bahamas must be prepared to deliver internationally accepted standards of service and internationally accepted levels of productivity,”*said the Minister. She added that The Bahamas must recognise that today’s realities require high quality, common standards of global application, to ensure comparability of financial information around the world.
Minister Maynard-Gibson pointed out that a sound global financial architecture depends upon an independent, competent and ethical accounting profession supported by the highest professional standards of all involved, an effective regulatory framework, and strong corporate governance.
She called on BICA and its members to look to the qualities expected in the 21st Century Bahamas, focussing on skills and leadership training, research and diversification of the skills base – perhaps in non-traditional areas. She concluded that Bahamian accountants are capable of accepting the challenge of becoming active participants in all areas relating to changes in the world economy.