Offhore Financial Sector in the Caribbean
Section 1
1.0 Introduction
Over the years, the activities of the Offshore Financial Centers (OFC) have been a point of interest from their emergence during the 1960s and 1970s. With the growth of the Euro- dollar market, Some American banks decided to have a more practical presence in London. Since the authorities were insistent that a physical presence was necessary, the expansion of their operations to London proved to be a very expensive proposition for the smaller banks. It was however, a lucrative one. Choosing to stay out of the British financial landscape would have placed them at a disadvantage in terms of international competition. Their domestic operations stood to benefit from participating in the international currency market. In order to ensure competitive levels, the Federal Authorities decided to permit the small American banks to set up offices in London, giving rise to the term “Offshore Financial Sectors”.
The first offshore operations to be established in the Western Hemisphere were in The Bahamas. Higgins (2000) indicated that these operations, introduced by British and Canadian interests in The Bahamas, were to provide management services to wealthy international clients. Higgins also points out that within a short period of time, these kinds of operations had spread to other British territories and eventually to the rest of the Caribbean. When the governments of the various countries saw the benefits enjoyed by the specific countries at that time were: The Bahamas, Cayman Islands, the British Virgin Islands and Panama.
In the resent past Offshore Financial Center has had to amend their regulatory practice in keeping with concerns of the international financial bodies relative to tax evaluation, money laundering, financing of illegal fire arm and other financial operations.
The major issue that we explore in this paper is the regulation of the Offshore Financial Centers in The Bahamas, Dominica and St. Vincent, and were these
1.0 Introduction
Over the years, the activities of the Offshore Financial Centers (OFC) have been a point of interest from their emergence during the 1960s and 1970s. With the growth of the Euro- dollar market, Some American banks decided to have a more practical presence in London. Since the authorities were insistent that a physical presence was necessary, the expansion of their operations to London proved to be a very expensive proposition for the smaller banks. It was however, a lucrative one. Choosing to stay out of the British financial landscape would have placed them at a disadvantage in terms of international competition. Their domestic operations stood to benefit from participating in the international currency market. In order to ensure competitive levels, the Federal Authorities decided to permit the small American banks to set up offices in London, giving rise to the term “Offshore Financial Sectors”.
The first offshore operations to be established in the Western Hemisphere were in The Bahamas. Higgins (2000) indicated that these operations, introduced by British and Canadian interests in The Bahamas, were to provide management services to wealthy international clients. Higgins also points out that within a short period of time, these kinds of operations had spread to other British territories and eventually to the rest of the Caribbean. When the governments of the various countries saw the benefits enjoyed by the specific countries at that time were: The Bahamas, Cayman Islands, the British Virgin Islands and Panama.
In the resent past Offshore Financial Center has had to amend their regulatory practice in keeping with concerns of the international financial bodies relative to tax evaluation, money laundering, financing of illegal fire arm and other financial operations.
The major issue that we explore in this paper is the regulation of the Offshore Financial Centers in The Bahamas, Dominica and St. Vincent, and were these
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