The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

The Prime Minister yesterday said The Bahamas’ ambitions to become a digital assets hub will help it recover financial services activity that has been lost to the “global assault” on international financial centres (IFCs).

Philip Davis QC, speaking at the Concordia Americas Summit in Miami, asserted that over the past 25 years the Caribbean has been “disappointed by global forces and external shocks” that lie beyond the region’s control.

“The modern Bahamas is built on two pillars. Tourism, which makes up approximately 80 percent of our GDP, and then financial services,” he added. “Globally, our financial services were assaulted by the OECD (Organisation for Economic Co-operation and Development) and the other forces, FATF (The Financial Action Task Force), and we survived by continuing to be innovative and creative and attempting to stay ahead of those forces.”

This has involved complying with these agencies’ rules on tax information exchange and other forms of disclosure demanded primarily by the 27-nation European Union (EU) and its members. However, the evolution of digital assets - the likes of crypto currency, blockchain and non-fungible tokens - has provided The Bahamas with an opportunity to restablish its value proposition and a financial services competitive advantage.

“Hence we, for example, recognised the space of crypto, recognising that it is here and it’s here to stay, and so I immediately upon assuming office, recognising that and recognising that 20 percent of my GDP I had lost because of the intervention of the industrialised world, that was the way to replace it. So I went after the crypto and the digital space,” Mr Davis said.

“The Bahamas is an ocean state, spreading over 100,000 square miles. We are amongst the 10 most vulnerable countries in the world to climate change. Our islands could disappear within the next 30 years, and so the effort to reduce the carbon footprint is a crisis for us.”

“What we have recognised is that The Bahamas and small island states have nothing to do with carbon emissions. But quite apart from not emitting, we are the one of the major and significant carbon sinks of the world.”

The Bahamas has been “picking garbage out of the air because of our seagrass and mangroves, but we’re not being paid for it”, Mr Davis said. He wants to “tie” the climate change fight to digital assets so that The Bahamas can raise revenues while simultaneously holding developed countries accountable for their pollution.

He added: “We’ll be continuing along those lines, but it is for us to continue to stay together and let those who are responsible for the consequences that we are now suffering pay for it.

“I can say unequivocally that more than 50 percent of my national debt today is as a direct result of the consequences of climate change. Adaptation and mitigation. We have to borrow to recover, borrow to restore and bring back the country to normalcy, and now that all we have are pledges and pledge fatigue. Hopefully by this COP27 coming up we will see more real action from the world.”