Business
Business, International Issues
Novel Facebook-based survey measures citizen frustration with bureaucracy in Latin America and Carib
The Inter-American Development Bank launched two studies that show the low regard citizens have for the quality of public services they receive and how innovation can help make these services less bureaucratic. [IDB Release](http://www.iadb.org/en/news/news-releases/2017-01-12/perceptions-of-bureaucracy-in-latin-america,11704.html)
BFSB News, Business, Industry News, The Economy
IBFS 2017: Responding to Change Through Innovation
The annual [International Business & Finance Summit](http://www.ibfsbahamas.com/ibfs2017/ ) (IBFS) will be held January 26-28, 2017 in the idyllic surroundings of Grand Bahama at the Lighthouse Pointe, The Grand Lucayan Resort. It will bring together key stakeholders, executives and thought leaders to discuss matters pertinent to the industry. Specifically, says BFSB CEO Tanya McCartney, *”IBFS 2017 will focus on responding to change through innovation. Industry stakeholders will look at the role of IFCs in the global economy and trends impacting the way that we do business.*” The Summit also will explore opportunities for The Bahamas to review and transform its business model.
Business, Industry News, International Issues, Legal, Tax Co-operation, The Economy
The Bahamas Makes Progress in the Implementation of CRS
Minister of Financial Services the Hon. C.V. Hope Strachan reported today that [the Bill](https://bfsb-bahamas.com/news.php?cmd=view&id=3694&pre=y) to provide for the implementation of the Common Standard on Reporting and Due Diligence for Financial Account Information in Tax matters and for connected purposes now has been passed unanimously in both Houses of Parliament. A release from the Ministry notes that the passage of this legislation *”evidences The Bahamas’ commitment to implement the OECD’s Common Reporting Standard (CRS) for the Automatic Exchange of Financial Information in 2018. The Bill sets out the requisite legal framework to begin the process for the automatic exchange which is mandated to take place on an annual basis.”* The legislation confers the necessary powers on the Competent Authority to enter into Agreements with the government of another country for the automatic exchange of financial account information in tax matters. It also ensures the proper administration and enforcement of the Act. Minister Strachan said that proactive steps have been taken already to identify the countries that The Bahamas intends to negotiate with on bilateral agreements for the automatic exchange of information. An initial group of countries has been prioritized – following consultation between The Ministry of Finance as the Competent Authority, The Office of the Attorney General, The Ministry of Financial Services, The Bahamas Financial Services Board and industry stakeholders. The Ministry of Financial Services has pledged to keep the Bahamian public and all relevant stakeholders advised as the country progresses with the implementation of CRS. *”Moreover, The Bahamas will continue to strive towards meeting international standards of tax cooperation and transparency to preserve The Bahamas’ reputation as a compliant financial services jurisdiction and a financial centre of excellence,”* the release confirmed. MoFS Official Release – See pdf below
Business, Industry News, International Issues, The Economy
FSB On Decline in Correspondent Banking
The Financial Stability Board (FSB) has released its latest progress report on the implementation of its four-point action to assess and address the decline in correspondence banking. The progress report includes a set of deliverables for 2017 to implement the action plan, and describes progress in taking forward the plan: * Further examining the dimensions of the problem, and its causes and effects; * Clarifying regulatory expectations, as a matter of priority, including through guidance by the Financial Action Task Force (FATF); * Domestic capacity-building in jurisdictions that are home to affected respondent banks; * Strengthening tools for due diligence by correspondent banks. Alexander Karrer, Chair of the CBCG and Deputy State Secretary at the Swiss Federal Department of Finance said: *”A well-functioning correspondent banking system is essential for ensuring international payments. A decline in correspondent banking relationships can adversely affect growth, financial inclusion, remittances flows as well as the stability and integrity of the global financial system. Since the creation of the CBCG earlier this year, good progress has been made to assess and address this issue, but additional steps are needed to move from awareness raising to action. Given the number of actors involved, international cooperation and coordination are key.”* A further progress report on the work of the CBCG will be published in advance of the G20 Leaders’ Summit in Hamburg in July 2017. [FSB Release](http://www.fsb.org/2016/12/fsb-publishes-progress-report-and-2017-workplan-to-assess-and-address-the-decline-in-correspondent-banking/) [Progress Report](http://www.fsb.org/wp-content/uploads/FSB-action-plan-to-assess-and-address-the-decline-in-correspondent-banking.pdf)
Business, The Economy
US Senate Passes US-Caribbean Strategic Engagement Act 2016
The [legislation](https://www.govtrack.us/congress/bills/114/hr4939) to enhance US engagement with the Caribbean has passed both the House and Senate and is headed to President Barack Obama for signature into law. Sponsored by Rep. Eliot Engel (D-NY), ranking member of the House Committee on Foreign Affairs, and Rep. Ileana Ros-Lehtinen (R-FL), a former chair of the Committee, the new law calls for a new, long-term strategy to strengthen ties between the United States and its Caribbean neighbours. *”At a time when our friends in the Caribbean need us more than ever, this bill will prioritize our partnership with the sub-region for many years to come. It is long past time to have a multi-year strategy that will allow us to increase engagement with the Caribbean, especially when it comes to energy and security. The countries of the Caribbean are profoundly important to the United States, and particularly to the many Caribbean-American citizens in our country. I look forward to working with the Caribbean-American diaspora to ensure that they can provide input to the State Department and USAID on US relations with the Caribbean in the years ahead. With constant crises around the globe that demand US attention, we must not lose sight of our long-term interests close to home,”* Engel said. Ros-Lehtinen added, *”I am honoured to work alongside my friend and colleague Eliot Engel in order to send this important legislation aimed at prioritizing our bilateral relationships with allies in the Caribbean to the president’s desk. We must strengthen our relationship with Caribbean nations so that they view the US as a reliable partner and push back against the negative influence of [Venezuela president] Maduro’s corrupt regime in the region. It is vital to work proactively and collaboratively with Caribbean nations to promote close cooperation in the areas of security, trade, illicit trafficking, and energy and I look forward to seeing this important legislation implemented in order to advance our own national security interests.”* The United States-Caribbean Strategic Engagement Act (HR 4939) will strengthen relations with the Caribbean by requiring the Secretary of State and the Administrator of the US Agency for International Development (USAID) to submit to Congress a multiyear strategy focused on enhancing engagement with the countries of the Caribbean. There is particular emphasis on energy security, countering violence, expanding diplomacy and providing educational exchange opportunities for citizens of the Caribbean.
Business, International Issues, The Economy
IMF Mission Concludes Visit to The Bahamas
An International Monetary Fund (IMF) team led by Jarkko Turunen visited The Bahamas from December 7-13, 2016, to update the economic and financial outlook following Hurricane Matthew. The team reports that despite significant damage by Hurricane Matthew, growth is expected to resume next year, supported by construction activity and work toward completion of Baha Mar resort. Also noted was that (a) further fiscal consolidation, including more determined efforts to rationalize spending, remains critical for rebuilding fiscal and external buffers; and (b) high unemployment and the high volume of non-performing loans continues to dampen private sector credit and economic activity. Mr. Turunen issued an [official statement](http://www.imf.org/en/News/Articles/2016/12/13/PR16557-The-Bahamas-IMF-Mission-Concludes-Visit) at the conclusion of the mission. While in The Bahamas , the mission met with the Honorable Michael Halkitis, Minister of State for Finance, Mr. John Rolle, Governor of the Central Bank of The Bahamas, other senior government officials and representatives of the private sector.
Business, Industry News, International Issues, The Economy
FSB Regional Consultative Group for the Americas Meets in Nassau
The Financial Stability Board (FSB) Regional Consultative Group (RCG) for the Americas met in Nassau today at a meeting hosted by the Central Bank of The Bahamas. At their meeting, members of the FSB RCG for the Americas began by reviewing the FSB’s Work Plan and policy priorities for 2017. In particular, the group discussed the FSB work on implementation and effects of the G20 financial reforms. The RCG discussed the findings of the second annual report for G20 Leaders on the implementation and effects of reforms published by the FSB in August 2016. Members of the group discussed regional macroeconomic and financial market developments, and key financial stability issues in the region, including possible policy responses to these developments. A discussion took place on the impact of the low interest rate environment on financial stability, including the impact on bank profitability and possible spillovers for emerging market and developing economies. The group next discussed developments in fintech including the implications of distributed ledger technology and peer-to-peer lending and relevant developments in the insurance industry. The group considered the benefits these developments could provide in terms of deepening access to financial services and promoting financial inclusion. However, they also discussed possible risks that could emerge from fintech developments and potential issues for authorities. The RCG discussed the FSB’s action plan to assess and address the withdrawal of correspondent banking services. In particular the group considered the impact of reductions in correspondent banking relationships in the Americas and a proposal for the RCG to establish a new working group on the broader issues of “de-risking” in some parts of the region. The group received an update on the work of the RCG working group on shadow banking. The working group will publish a report in the coming months and is discussing its workplan for 2017. The group also discussed work on long-term investment financing in the region. The FSB RCG for the Americas is co-chaired by Carolyn Wilkins, Senior Deputy Governor, Bank of Canada and DeLisle Worrell, Governor, Central Bank of Barbados. Membership includes financial authorities from Argentina, Bahamas, Barbados, Bermuda, Bolivia, Brazil, British Virgin Islands, Canada, Cayman Islands, Chile, Colombia, Costa Rica, Guatemala, Jamaica, Mexico, Panama, Paraguay, Peru, Uruguay and the United States of America. ##About the FSB## The FSB has been established to coordinate at the international level the work of national financial authorities and international standard setting bodies and to develop and promote the implementation of effective regulatory, supervisory and other financial sector policies in the interest of financial stability. It brings together national authorities responsible for financial stability in 24 countries and jurisdictions, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts. Through its six Regional Consultative Groups, the FSB conducts outreach with and receives input from an additional approximately 65 jurisdictions. The FSB is chaired by Mark Carney, Governor of the Bank of England. Its Secretariat is located in Basel, Switzerland, and hosted by the Bank for International Settlements. The FSB has six Regional Consultative Groups, established under the FSB Charter, to bring together financial authorities from FSB member and non-member countries to exchange views on vulnerabilities affecting financial systems and on initiatives to promote financial stability.
Business, The Economy
Caribbean Infrastructure Finance Forum 2016
CIBC FirstCaribbean was title sponsor for the 3rd Caribbean Infrastructure Finance Forum held Dec 6-7 at the British Colonial Hilton. Managing Director of Corporate & Investment Banking, Berisford Grey says the institution is committed to assisting governments across the region to achieve their infrastructure development goals. *”What we want to do is be there as a long-term partner with governments across the region so that we can help them to be leaders in terms of banking and to realize the goals they want to achieve when it comes to infrastructure development.”* Delegates at CARIF addressed several key issues, including the high cost of energy, the importance of public-private partnership among business and the need for liquefied natural gas (LNG) in the region. Bahamas Deputy Prime Minister the Hon. Philip Davis gave the keynote address, highlighting the need for more emphasis to be placed on renewable energy and noting that Bahamas Power and Light Limited (BPL) wants 20% of its power from renewable energy within the next five years. CIBC FirstCaribbean is a leading financial lender for BPL’s parent company, The Bahamas Electricity Corporation, and plans to continue working with the government to ensure that the infrastructural needs are met when it comes to energy and other structural needs. Energy reform was one of the major highlights during the conference and Mr. Grey said CIBC FirstCaribbean is willing to help the government to accomplish that goal. *”That is significant…that basically means we have a lot of work to do, we have a lot of opportunities to fund and we have a lot of strategic decisions to make as a region.”* CIBC FirstCaribbean teamed up with [New Energy Events](http://newenergyevents.com/carif/) to host the event. See CIBC FirstCaribbean Release below.
Business, Securities Industry, The Economy
Securities Commission Rules to Facilitate Small Business Funding
New Rules under development by the [Securities Commission of The Bahamas](http://www.scb.gov.bs) would allow entrepreneurs to use crowdfunding to raise up to $1,000,000 and make it easier for small businesses to raise up to $3,000,000 per year. Crowdfunding Rules as well as Micro, Small and Medium Enterprise (MSME) Rules are being developed to introduce specific regulations for entrepreneurs to use crowdfunding to raise capital, and to ease access to capital market funding by MSMEs. The Rules are anticipated to facilitate much-needed funding for MSMEs via the capital markets while introducing appropriate mechanisms to protect investors. The proposed Crowdfunding Rules would allow the general public to participate in crowdfund investment offerings within limitations. They would also require that all equity crowdfund activities are conducted on a platform which is registered with the Commission. Over the next month, the Commission will engage local broker dealers and other industry experts for input on the draft Rules. The Commission is aiming to submit the Rules to the general public for consultation in early 2017, with a view to having the final Rules come into effect shortly after. To help protect retail (small and/or unsophisticated) investors, the Crowdfunding Rules would limit the amount such persons could invest to $500 per crowdfund arrangement, and $2,500 per year. ‘Accredited’ investors (investors who meet certain wealth, income, institutional or other requirements as defined in securities laws) would not be limited in the amount they can invest via crowdfunding. Other investor protection features of the draft Rules include capital requirements for registered platforms and defined disclosure requirements for crowdfunding projects and their initiators, including the amount of capital raised and progress reports on initiatives funded using the crowdfund method. The Rules being developed and proposed for MSMEs would allow small business operators to raise up to $3,000,000 per year in the ‘Over-the-Counter’ (OTC) market without having to file a prospectus with the Commission. Rather, they would be required to file an offering memorandum, which would provide comprehensive information to allow investors to make informed investment decisions. One of the main purposes behind the MSME Rules would be to significantly reduce the costs for small business operators who wish to raise funding for their ventures by directly accessing the capital markets. To help protect retail investors in MSME offers, the draft Rules would limit the amount of money that such persons could invest to $1,000 per offering and $5,000 per year. As is the case for crowdfunding, accredited investors would not be subject to investment limitations under the draft Rules. MSMEs spur growth, development, and innovation in an economy, and they account for 60% to 70% of jobs in most Organisation for Economic Co-operation and Development (“OECD”) countries. However, despite the many benefits MSMEs can bring, they suffer from insufficient funding, with commercial bank options unavailable or very costly, and traditional capital market alternatives also often cost-prohibitive. With the development of these new Rules, the Securities Commission is seeking to facilitate capital access in order to address this funding gap.