The Economy

Today, IMF Deputy Managing Director Tao Zhang addressed a [Caribbean Finance Conference](https://bfsb-bahamas.com/news.php?cmd=view&id=3660) being hosted in Antigua. The IMF representative pointed to the linkages between financial services and tourism, and other sectors, acknowledging the importance of the key agenda item for the 2-day forum – and the need for a collective solution to a collective problem. He addressed three themes relating to the focus on the Withdrawal of Correspondent Banking Relationships: The scope and sources of the problem; Taking stock of the policy response in the Caribbean region and from the international community; and Issues that need to be addressed going forward. He concluded his presentation by outlining what the IMF considers “next steps”. *”We know by now what the problems are. We also know that while there is ‘no quick fix’ to the problem, there is an urgent need for action to mitigate the impact on affected economies.”* Three areas to be explored further in the immediate steps towards concrete action were identified as: * addressing the problem of economies of scale; * mitigating cost and technical limitations; * improving information flows. Click [here](http://www.imf.org/en/News/Articles/2016/10/28/SP102816-The-Caribbean-Response-to-the-Withdrawal-of-Correspondent-Banking) for the full presentation.

The World Bank has released its 2017 Doing Business Report, noting that a record 137 economies around the world have adopted key reforms that make it easier to start and operate small and medium-sized businesses.. In its global country rankings of business efficiency, Doing Business 2017 awarded its coveted top spot to New Zealand, Singapore ranks second, followed by Denmark; Hong Kong SAR, China; Republic of Korea; Norway; United Kingdom; United States; Sweden; and Former Yugoslav Republic of Macedonia. [Full Report](http://www.doingbusiness.org/~/media/WBG/DoingBusiness/Documents/Annual-Reports/English/DB17-Full-Report.pdf?cid=ECR_E_NewsletterWeekly_EN_EXT) [World Bank Release](http://www.worldbank.org/en/news/press-release/2016/10/25/record-number-of-economies-carried-out-business-reforms-in-past-year-doing-business) **About Doing Business** The Doing Business project, launched in 2002, provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. It looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more efficient regulation; offers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business offers detailed [subnational reports](http://www.doingbusiness.org/Reports/Subnational-Reports), which exhaustively cover business regulation and reform in different cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The first Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has benefited from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world.

A crucial Conference in Antigua is set to address issues confronting the banking system in the Caribbean. Pursuant to a mandate from Heads of Government of the [Caribbean Community](http://caricom.org) (CARICOM), Antigua this week will host a conference of high level representatives of the IMF, the World Bank, the OECD Global Forum on Tax matters, the Inter-American Development Bank, the CARICOM Secretariat, the Caribbean Development Bank and representatives of governments, central banks and regulatory authorities. Antigua and Barbuda Prime Minister the Hon. Gaston Browne has responsibility for financial matters within CARICOM. The majority of banks in Caribbean countries have experienced the loss of correspondent banking relations that threaten to sever the region from the world’s financial and trading system, unless it is arrested soon. The event is being held October 27-28, and reportedly is a ‘closed door’ forum of the stakeholders to address the problem through a frank dialogue, and looking for sustainable solutions. The Antigua and Barbuda Ambassador, Prime Minister Gaston Browne’s point man in the organization of the conference, has said there will be a session on the *“unfortunate branding of Caribbean jurisdictions as tax havens”* – a wrongful branding *“the region has been fighting for over two decades”*. He also noted that in part this accounts for the fear that exists in US banks that they face high-cost risks by providing correspondent relations to Caribbean banks. IMF Deputy Managing Director Zhang Tao will make a public statement on the second day of the conference on October 28. At the end of the conference, Browne will issue a ‘chairman’s statement’ on the outcomes and recommendations of its deliberations. Next week, the IMF will host a High Level Caribbean Forum in Trinidad and Tobago, when the agenda (Session III) will include policies to address de-risking. **Shifting Tides: Challenges and Opportunities** The Trinidad forum will bring together Caribbean prime ministers, finance ministers and central bank governors, donors, and representatives from international financial institutions and the private sector to exchange views on the unique challenges and opportunities for the Caribbean region. It will address global and regional challenges (growth, competitiveness, and oil prices), spillovers from Cuba, and policies to address de-risking. The Forum is being hosted by the International Monetary Fund and the Trinidad and Tobago authorities. More [here](http://www.imf.org/external/np/seminars/eng/2016/caribbean/).

The Hon. Frederick A. Mitchell, M.P., Bahamas Minister of Foreign Affairs and Immigration, presented [remarks](http://www.un.org/apps/news/story.asp?NewsID=55122#.V-w10_Q0OfY) at the United Nations General Assembly on Monday, September 26. The General Assembly was held under the theme: “The Sustainable Development Goals: A Universal Push to Transform Our World”, and the Minister spoke to various initiatives in which The Bahamas has participated. The Bahamas has joined the United States and others in the Safe Ocean Network, a global initiative aimed at combating all aspects of the fight against illegal fishing, including detection, enforcement, and prosecution. The Bahamas also has placed a role in the advancement of women, with a representative serving on the Committee on the Elimination of Discrimination against Women (CEDAW), and is seeking election for membership on the Human Rights Council for the 2019-2021 term. The Minister also spoke to the fight for the integration of all young people into the formal economy, with an emphasis in The Bahamas on young males and the need to better prepare them for participation in society. Minister Mitchell used the opportunity to speak on the issue of the over regulation imposed on countries and the negative consequences thereof. He referenced [presentations](http://www.un.org/apps/news/story.asp?NewsID=55092#.V-w2NfQ0OfY) by other CARICOM countries on the dangers of de-risking, the use of pejorative expressions in describing the region, and new financial rules and imposition of unfair sanctions. He said the Bahamas does not shield anyone involved in unlawful behavior, and adheres to all applicable agreements relating to money laundering and the unlawful escape from taxes. In this connection, the attacks on The Bahamas and the CARICOM region were described as inaccurate and unfair. Specific reference was made to the recent assaults in the media about the Bahamian financial services sector – actions labelled as reprehensible and violation of international norms. *”If then you argue that it is immoral to evade your responsibility to pay taxes at home and we agree, then we also argue that you have a moral responsibility to understand that over regulation and changing the goalposts and not creating a level playing field in the financial services sector, and de-risking being part of that whole cloth, can bring about in their effects an immoral result. This problem must be solved by those who imposed the regulations. It is a moral imperative.”* CARICOM countries are shining examples without exception of liberal democracies: ideological pluralism, capitalist economies, multiparty states, regular elections and independent judiciaries, low levels of institutional corruption and regular public consultations on policies. This world body has a stake then in ensuring that the societies of the CARICOM region survive, the Minister said. *”The United Nations is where we have a level playing field. It is the appropriate forum to make that case. This is so whether the issue is banking, financial services, climate change, sustainable development and financing for development, migration or just surviving.”*