24 Nov 2011
The business environment in Guernsey fosters innovation and is supported by a first-rate professional services and communications infrastructure. We are recognised around the world for our finance sector, and we have established a reputation, over more than half a century, as a transparent and well-regulated international centre of excellence; but we are also home to a diverse range of businesses. Here, I explain more about our economy and about Guernsey on the world stage.
Guernsey is a fiscally independent, legislatively competent, and mature jurisdiction. Whilst Guernsey has not been immune to the global financial crisis, we have exhibited robust resilience, in part due to our diversified banking and finance sectors, which are based upon four key pillars: insurance, funds, fiduciaries, and banking. These four sectors are complemented by the presence of the Channel Islands Stock Exchange in capital St Peter Port.
Guernsey is fiscally prudent, and our approach is geared towards maintaining our fiscal and economic competitiveness. Our government has laid out clear policies to ensure economic and fiscal stability and sustainability together with a competitive business environment and a robust and proportionate regulatory regime which meets the highest international standards. Guernsey has nil government debt, and carries an AAA Standard and Poor’s credit rating. The global economic outlook, however, remains highly uncertain, so whilst we remain confident, we are never complacent.
Guernsey is a British Crown Dependency. This means we are self-governing, fiscally independent and have our own legislative assembly. Whilst we have close ties with Europe, Guernsey is not a member of the European Union. However, special terms were negotiated for Guernsey as a “third country” on the UK’s accession to the EEC, and this means that we are within the Common Customs Area and the Common External Tariff, and so have access to EU countries for physical exports without tariff barriers. We remain close to the UK and in particular, the City of London, providing a gateway for funds to flow into the City and the UK which would not otherwise route there. Our relationship with the City and the UK is one of mutual co-operation and partnership, and subsequently one of mutual benefit.
Over recent years, Guernsey has signed bilateral Tax Information Exchange Agreements (TIEAs) with 29 countries. This includes 13 EU Member States, over half of the G20 economies and 19 members of the Organisation for Economic Co-operation and Development (OECD), the international economic organisation responsible for setting the globally accepted principles of transparency and exchange of information for tax purposes. Not only is this a reflection of our evolving international identity, it also underlines our commitment to transparency in tax matters.
Guernsey is an original member of the OECD exchange of tax information “White List”, established in 2009, and was more recently rated by the OECD as a jurisdiction that has substantially implemented internationally agreed standards on exchange of information for tax purposes. Guernsey in fact has been given the highest compliance rating (category 1) by the UK in terms of compliance in information exchange, and moreover has never had banking secrecy laws. In recent IMF evaluation reports into Guernsey’s banking and insurance sectors, Guernsey achieved ratings that were among the highest awarded to any jurisdiction.
Guernsey plc, then, is in very good shape to meet the challenges that will come and to take advantage of the opportunities that will arise. And it is against this background that we continue to maintain our commitment to excellence.