British Virgin Islands: More Growth In Financial Services Expected In 2006
Last Updated: 23 December 2005

Government is projecting continued and significant growth in the Territory’s financial services sector next year, Minister for Finance Honourable Ronnie W. Skelton said in his recent Budget Address.

The Finance Minister said Government is predicting a windfall of just under $130 million from the sector in 2006, an increase of more than 15 percent over 2005. This year’s revenues from financial services were projected at $110 million, and estimates are that the sector will outpace this projection by $2.5 million before the end of December.

Minister Skelton said the local financial services industry will continue to expand as the Territory encourages new investment and continues to market its services internationally. He said the BVI must remain on the cutting edge of the industry, adding that formulating required legislation and ensuring proper training of regulators to keep the sector successful are imperative.

The Finance Minister said that the sector’s recent performance and projections for its future lay to rest fears that the establishment four years ago of the Financial Services Commission (FSC) would depress revenue generation in the sector, particularly after responsibility for marketing was transferred to the BVI International Finance Centre (IFC).

"Madam Speaker, I am pleased to report that, after four years the reality has confounded those fears," the Minister said. From its inception, the FSC recognised that a well-regulated industry requires the cooperation of all licensed providers, Minister Skelton said. As a priority, therefore, the Commission embarked on an industry-wide examination to determine an appropriate framework for good corporate governance. These guidelines will be presented to the industry in 2006.

In addition, the Finance Minister said the FSC will in 2006 commission final plans for the establishment of a satellite office in Hong Kong. He said the Commission’s presence in Asia will improve the efficiency of services provided to this market and reduce barriers presented by language, culture and business environment.

A recent report from the International Monetary Fund states that "the BVI has most of the essential elements for a suitable framework for financial supervision," a comment Minister Skelton described as rewarding. He said this means Government’s efforts to enhance the Territory’s financial services sector are not going unnoticed.

The 2006 budget, presented under the theme "Advancing Our Social Services," has been referred to the Standing Finance Committee, which will review it in detail. Following that, it will be returned to the Legislative Council for final debate and approval.

The FSC is an autonomous agency responsible for the regulation and supervision of the BVI’s financial services industry, while the IFC, which comes under the Ministry of Finance, focuses on marketing the Territory as an innovative, efficient and respected international finance centre.

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