Regional Working Group organised for the OECS Financial Services Sector

Dr. Lorraine Nichols

OECS Secretariat – Castries, St. Lucia (February 4th, 2010): The OECS Secretariat has constituted a Working Group to address issues confronting the region’s Financial Services sector. This newly established group comprises representatives from the Ministries of Finance as well as Financial Services Regulatory Agencies in OECS Member States.

The initial OECS Working Group met for the first time via videoconference on Tuesday February 02, to discuss developments with respect to Financial Service Agreements.

The meeting attempted to devise a systemic, tactical approach to collectively address requirements from the Organisation for Economic Cooperation and Development (OECD). The Castries based OECS Secretariat says the Financial Services sector is increasingly becoming a major pillar of economic development in the OECS but recent developments, led by the OECD in particular, have posed a threat to the viability of the sector. Since the mid 1990s, the OECD has embarked on a programme against so-called tax havens, whereby some international financial institutions regarded the off-shore financial sector negatively and applied increased scrutiny to the sector’s operations.

OECS Working Group A

Programme Officer at the OECS Secretariat’s Economic Affairs Division Dr. Loraine Nicholas says in this regard, OECS Member States have over the years committed to compliance with the requirements of the OECD, and have taken necessary steps to address highlighted shortcomings in the Financial Services sector: “Notwithstanding these efforts, OECS Member States were still included on the “grey list” of countries published in April 2009 by the OECD. This list comprised countries deemed by the OECD to have committed to its standards and approaches, but had not yet taken the full range of actions required to give complete expression to that commitment. A key basis for this conclusion was the limited number of Tax Information Exchange Agreements (TIEAs) between OECS Member States and other countries. Since the grey listing of OECS countries, most of them have taken the initiative to establish TIEAs with OECD member countries, in light of a March 2010 deadline when the OECD will revise its listing of countries.”

OECS Working Group B

This key discussion topic at Tuesday’s meeting follows up on an offer by Barbados of technical assistance, particularly with regard to institutional strengthening, drafting of legislation, training and implementation of TIEAs in the region.

The establishment of the OECS Working Group for the Financial Services sector follows on a mandate from the OECS Authority, given at its 50th meeting in Anguilla, in November 2009.