The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas must decide whether to take its financial services business “to the next level or watch its current market base erode”, a leading attorney yesterday calling for the industry to develop a ‘Master Plan’.

Bryan Glinton, a partner at the Glinton, Sweeting, O’Brien law firm, told Tribune Business that the private sector and the Government needed to forge a true partnership and determine “whether we’re prepared to change for the new environment we find ourselves in”.

Mr Glinton was speaking after the Bahamas Financial Services Board (BFSB) held a private conclave for industry executives at the weekend.

Attended by 50-60 accountants, attorneys and bank and trust company representatives, well-placed Tribune Business sources said a “pessimistic” mood prevailed among many attendees due to the latest G-20/OECD initiatives aimed at the Bahamas and other international financial centres (IFCs).

The pessimism, this newspaper was told, related to whether the Bahamas could develop a “viable” financial services industry and business model given the growing pressures for automatic tax information exchange to become the global standard.

Other pressures also factored into the discussions and Mr Glinton, a financial services specialist who was present at the BFSB conclave, agreed that pessimism over the Bahamas’ future in the industry “may certainly be the view of some”.

He also acknowledged that this reflected the fact that the G-20/OECD initiatives, which started off as a due diligence/Know Your Customer drive, had some 12 years later evolved into the “ultimate goal” of forcing the Bahamas and other IFCs to become “enforcers of their tax policy and collections”.

But, striking a more upbeat tone, Mr Glinton told Tribune Business: “I certainly personally remain optimistic, but a lot of that optimism stems from whether the private sector, as well as the Government, are prepared to have a sit down discussion on what we’re prepared to change for the new environment we find ourselves in.”

The well-known attorney said both the Government and private sector needed a “clear understanding” that they had to forge a true partnership to move the financial services sector forward, adding: “It’s not a one-way street.”

“We have to come up with a ‘Master Strategy’, which we lack in financial services as opposed to tourism,” Mr Glinton said. “We have to come up with this Master Plan that goes beyond whichever government is in power.”

He indicated that the Bahamas future lay in attracting high net worth individuals and their clients to follow their assets to these shores, purchasing multi-million dollar homes and becoming permanent residents.

Apart from eliminating all ‘home country tax issues’ surrounding such clients, they will also employ house staff and, potentially, invest in the domestic Bahamian economy.

Perhaps the best example of this are the Izmirlian family and Joe Lewis, both permanent residents and Lyford Cay-based billionaires, who are largely responsible for the Baha Mar and Albany projects, respectively.

“There’s some opportunities there and opportunities to grow,” Mr Glinton told Tribune Business.

“One of the things unique about the Bahamas is its location. It is also a pretty developed country, and has a high standard of living for persons wanting to relocate to our jurisdiction.

“I find the question is: Can we serve this group, and do we want to do that? That is a decision we are faced with as a government and private sector? Are we prepared to go to the next level, or are we satisfied with watching our current market base erode?

“Or are we prepared to rise to the challenge and take advantage of opportunities that are out there in the new landscape? That’s the choice we have to make as a country, both government and the private sector, and sooner rather than later. No question about that.”

Noting the existing barriers to achieving this goal, Mr Glinton pointed out that it often took a year for high net worth purchasers to obtain a certificate of permanent residency.

Other issues that the Bahamas will have to tackle, if it wants to attract more multi-millionaires to domicile here, are crime and the inefficiencies in government bureaucracy and the economy - especially high cost, poor service utilities and delays in getting all the necessary permits and approvals.

“If we’re prepared to rise to that challenge, I’m optimistic,” Mr Glinton added. “I think we have the wherewithal to do it.

“But we need this Master Strategy. We can’t put a Band Aid or tape on it. We have to determine what we’re trying to achieve as a nation.”