In discussions on the future of off-shore financial centres, Premier and Minister of Finance, Dr. the Honourable D. Orlando Smith, OBE, presented his insights today at the Foreign Correspondents’ Club during a luncheon meeting hosted by the Hong Kong General Chamber of Commerce.
His presentation was titled: “Riding the Perfect Storm: Will Offshore and Midshore Jurisdictions Remain Viable?”
Premier Smith highlighted the more than 25-year history the BVI has had with Asian businesses and individuals, helping them gain access to international capital markets, which explains the BVI’s critical role today in cross-border investments.
Ranked as the most important offshore financial centre in the world by the Offshore 2020 report, the BVI consistently appears among the top four for inward Foreign Direct Investment (FDI) flows and top ten for outward flows globally.
“BVI companies are used for a diverse range of purposes, such as listing vehicles, joint ventures, asset holding and investment fund vehicles,” Premier Smith stated.
He added, “They play a material role in providing diverse structures for wealth management and provide for the free and efficient movement of capital across borders, fuelling global economic growth.”
Given the context of an increasingly challenging global regulatory landscape, with the move towards global standards on exchange of information, such as FATCA, and OECD initiatives related to global taxing rules, tightening of anti-money laundering rules and public shareholder registers, Premier Smith shared his insights on the current role and future viability of international finance centres – offshore, midshore and onshore.
In response to the more recent global regulatory measures, the BVI has to date signed 26 tax information exchange agreements (TIEAs).
The BVI has also agreed to the G5 pilot initiative for automatic exchange of information, as well as signed up to the Convention for Mutual Administrative Assistance in Tax Matters to which over 60 other countries have also acceded.
Premier Smith suggested that offshore and midshore jurisdictions will have to come up with new products and offerings that are well-suited to handle global economic shocks, new clients in new geographies, as well as the new global regulatory environment, all of which implies a high level of innovation and execution.
In conclusion, he said, “Demand from China and other emerging markets will ensure that offshore and midshore centres have a sustainable future in the global economy. The BVI is well-positioned to be a part of and to facilitate this growth, and with a regional office now well established in Hong Kong, we look forward to forging even closer ties with the Asia region for many generations to come.”
For more information about BVI House Asia, please visit: www.bvihouseasia.com.hk.