By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas’ poor financial centre ranking is “clearly unacceptable”, a leading QC yesterday warning this nation does “not have the luxury” of a five-year fix.

Brian Moree QC, senior partner at McKinney, Bancroft & Hughes, told Tribune Business that the Bahamas needed to make “a quantum leap” in the Global Financial Centres Index (GFCI) to preserve its financial services industry’s competitiveness.

The Index, which is published every six months by Z/YEN, placed the Bahamas firmly in the bottom tier at 81st of 92 financial centres, and Mr Moree said “urgent” action was required to prevent financial business “going elsewhere”.

Acknowledging that the Bahamas’ ranking may result “more from perception rather than reality”, the senior attorney nevertheless said the Bahamas could not wait five to six years to achieve “significant improvement” in the GFCI Index.

He added that the structural obstacles impacting the financial services industry’s growth were the same as, or closely connected to, the issues impacting the domestic Bahamian economy, especially the ease and cost of doing business (see other article on Page 1B).

While the Bahamas improved by two places in the latest CFCI rankings, Mr Moree said 81st spot paled into comparison to rival Caribbean international financial centres (IFCs), which were all placed in the top 40.

“Any improvement in the ranking of the Bahamas in the Global Financial Centres Index is obviously a positive development, and consequently is commendable,” the senior QC told Tribune Business.

“But having said that, it’s clearly unacceptable for the Bahamas to be ranked 81st among 92 financial centres, thereby putting us in the lower tier of international rankings.

“That has to be addressed if we are going to expand and develop our financial services business in what is a very sophisticated market that is intensely competitive.”

Mr Moree’s reaction to the GFCI ranking contrasts with that of the Bahamas Financial Services Board (BFSB), which last week touted the two-spot ranking improvement and the Index’s description of this nation enjoying a “strong rise”.

Tanya McCartney, the BFSB’s chief executive, while praising the improved ranking, agreed that the Bahamas needed to improve its competitiveness in areas such as Immigration policy, tax structure and ‘ease of doing business’.

Mr Moree, though, urged the Government and private sector to collaborate for improvements in the five areas where the GFCI rates financial centres - human capital; infrastructure, financial sector development; reputation; and business environment.

Conceding that issues demanding the Minnis administration’s immediate attention had only increased in Hurricane Irma’s aftermath, he argued that the Bahamas’ ‘economic pillar’ deserved such focus given its importance to the economy and wider society.

“While in the Bahamas we think we have an established and highly professional cadre of service providers, the international community seems to rank us fairly low in the index,” Mr Moree said, “and both the Government and private sector working in collaboration with one another have to look at the five criteria and see where it is we have to make adjustments in order to address these concerns.”

Despite its own improvement, the Bahamas remains some way behind rivals such as Bermuda, the Cayman Islands and British Virgin Islands (BVI). Bermuda and the BVI, in particular, improved by five and 14 places, respectively, in the in the GFCI Index rankings to 29th and 37th. Cayman held its spot at 31st.

“Clearly there is work to be done here if we are going to provide the kind of environment necessary to expand our core business,” Mr Moree told Tribune Business. “We don’t have the luxury of doing this within the next three to four years.

“Both private and public sectors have to take some responsibility for addressing these issues together. The most recent ranking by the Global Financial Centre Index is a wake-up call for us to bring the level of urgency with which we have to approach this issue so we can see a significant improvement in this ranking within the next six months.”

Mr Moree continued: “As a jurisdiction we cannot afford to incrementally improve our ranking by a few spots every six months. We don’t have the luxury of time. We have to find ways to have a quantum leap in the rankings by addressing our weaknesses in a very efficient way.

“We cannot do that overnight, but we can’t wait to achieve that in the next five to six years, as business will go elsewhere. It requires focused, substantial attention bearing in mind the urgency of the matter.”

The prominent QC urged the Government and private sector to recognise the importance of “protecting the second largest industry in the Bahamas”, and added: “We have a very solid foundation to build on, and this may be more perception than reality.

“But, as is often said, perception is reality for those who take that view. We need to look at our cost base; look at our technical plant in the Bahamas; and look at Immigration policy as a development tool consistent with the growth and development of the industry, understanding the reasonable aspirations of Bahamian professionals.”