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Considering the Consequences

The Development Implications of Initiatives on Taxation, Anti-money Laundering and Combating the Financing of Terrorism

image of Considering the Consequences
What have been the consequences of recent regulatory initiatives on international financial centres in small countries? This study of three small Commonwealth countries – Barbados, Mauritius and Vanuatu – suggests that the costs of implementing these new standards have exceeded any identifiable benefits for the countries concerned.



Moreover the main factor explaining the adoption of the new standards, in all three countries, is the fear of the consequences of being blacklisted by international organisations in the event of non-compliance, rather than any identified benefit in terms of increased competitiveness.



The authors consider how policy on anti-money laundering should be developed in the future, taking into account the particular concerns of small developing countries.



The book will be of interest to all those engaged in setting international standards for financial regulation, and those regulating the finance industry in both large and small countries.

English

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Development of the IFS Industry in Mauritius

The intellectual origins of the international financial services (IFS) industry in Mauritius are perhaps traceable to 1972 when the Export Processing Zone (EPZ) was established with tax concessions and exemptions, an export orientation and prohibitions on domestic market access. The creation of the Offshore Financial Centre (OFC) 20 years later, applied the same ideas to financial services. Although it materialised in 1992, studies on establishing an OFC were carried out by the Bank of Mauritius (BoM) at the request of the Prime Minister’s Office (PMO) a decade earlier. However, the idea went into limbo during the mid-1980s; perhaps because of the debt crisis engulfing the developing world at the time, and the salutary experience of the Seychelles with its OFC. The OFC came up again for public discussion in 1988/89 when the findings of a study commissioned from an international firm became available and, concomitantly, the domestic financial sector was overhauled under a reform programme.

English

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