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Dr Smith Gov’t warned of need for Plan-B in upcoming ‘UK fight’

- Fmr VI Ambassador to UK & EU says “exodus of companies” very possible
The warning was sounded by former VI Ambassador to the UK and European Union, Mr E. Benito Wheatley, pictured here during the BVI-TB Stakeholders' Meeting. Photo: Team of Reporters
The UK Sanctions and Anti-Money Laundering Bill that received Royal Assent on May 24, 2018, which was met with much protest in the VI (pictured here), requires the OTs to implement public registers by December 31, 2020, or have them imposed by an Order in Council in the UK Parliament. Photo: VINO/File
The UK Sanctions and Anti-Money Laundering Bill that received Royal Assent on May 24, 2018, which was met with much protest in the VI (pictured here), requires the OTs to implement public registers by December 31, 2020, or have them imposed by an Order in Council in the UK Parliament. Photo: VINO/File
Premier and Minister of Finance, Dr the Honourable D. Orland Smith (AL). Photo: VINO/File
Premier and Minister of Finance, Dr the Honourable D. Orland Smith (AL). Photo: VINO/File
E. Benito Wheatley was at the time addressing those gathered for the British Virgin Islands Tourist Board’s (BVI-TB) Stakeholders' Meeting, held on July 31, 2018, in New York, United States of America. Team of Reporters
E. Benito Wheatley was at the time addressing those gathered for the British Virgin Islands Tourist Board’s (BVI-TB) Stakeholders' Meeting, held on July 31, 2018, in New York, United States of America. Team of Reporters
NEW YORK, NY, USA – The government of the Virgin Islands (VI) is being called on to urgently prepare contingency plans, in wake of the impending deadline for the implementation of ‘public registers’—a United Kingdom (UK) decision, that is believed, will have a crippling effect on the Territory’s Financial Services sector.

The warning was sounded by former VI Ambassador to the UK and European Union, Mr E. Benito Wheatley.

He was at the time addressing those gathered for the British Virgin Islands Tourist Board’s (BVI-TB) Stakeholders' Meeting, held on July 31, 2018, in New York, United States of America (USA).

Mr Wheatley was delivering remarks on, “the future of the BVI Economy and the UK’s decision to impose public registers of beneficial ownership on the Overseas Territories (OTs).”

Mr Wheatley—a Policy Fellow at the Centre for Science and Policy, University of Cambridge—noted, the Government’s position on the matter, is that the VI will not implement a public register until it becomes a global standard.

Imposed 

This, position was adumbrated by Premier and Minister of Finance, Dr the Honourable D. Orlando Smith (AL), but according to the former Ambassador to the UK, the two likely (future) scenarios, is that there will either be a compromise between the VI and UK on a public register, or the UK Parliament will pass an Order in Council, to enforce implementation.

The UK Sanctions and Anti-Money Laundering Bill that received Royal Assent on May 24, 2018, requires the OTs to implement public registers by December 31, 2020, or have them imposed by an Order in Council in the UK Parliament.

Mr Wheatley posits, “if a compromise is found, the situation should stabilise,” but if an Order in Council is passed, the VI Government has confirmed it will mount a legal challenge, and “if the Government loses, then we will certainly see an exodus of companies from the jurisdiction.”

2020

As such, Mr Wheatley has sounded the warning to the Dr Smith administration that, “at this stage, the Government should begin drawing up contingency plans for a worst case scenario…Twenty-twenty (2020) is not far off and Brexit negotiations have made the Conservative Government in the UK very fragile.”

Explaining the gravity of the situation, Mr Wheatley told those in attendance, “…there is a very real possibility that there could be a General Election (in the UK), either in the Fall of this year or the Spring of 2019.”

He suggested, while the VI “is disappointed with the current UK Government’s capitulation on public registers, they at least seem prepared to discuss how to mitigate any negative impacts.”

According to Mr Wheatley however, “a new Conservative or Labour Government could come to power that is completely unsympathetic to OTs and place them under undue pressure in relation to financial services.”

Uncomfortable Questions 

As such, Mr Wheatley is adamant, the VI urgently needs to begin rebalancing its economy, to reduce the Territory’s vulnerability to the external pressures on the financial services industry.

“The reality is that the pressure is not going to go away anytime soon…In fact, it is only going to increase.”

Mr Wheatley has since questioned, “…if financial services were to take a severe blow, how would the VI Government make up for a loss of nearly $135 million in government revenue?”

According to Mr Wheatley, “these are very uncomfortable questions, but they must be addressed.”

12 Responses to “Dr Smith Gov’t warned of need for Plan-B in upcoming ‘UK fight’ ”

  • cromwell (12/08/2018, 12:47) Like (22) Dislike (1) Reply
    Mr Wheatley seems to be the only local that is facing reality, and, voicing concern about the future of the BVI. The options on the table are basically go it alone, or, negotiate with the UK, neither of which are attractive. However, ultimately, those are probably the only two options realistically on the table today.
  • E. Leonard (12/08/2018, 12:58) Like (17) Dislike (1) Reply
    “Wheatley has since questioned, “…if financial services were to take a severe blow, how would the VI Government make up for a loss of nearly $135 million in government revenue?” Financial services is 1/2 of the economic pillar; tourism, the other half. Financial services generates approx 60% of government revenue. If financial services stumble, the economy will tumble. Making up $135M will be a heavy lift for the BVI. Moreover, in the near term, financial services stumbling will impact employment, standard of living and quality of life, delivery of services.......etc. Further, if financial services stumbles, civil service employment, contracting.........etc will be impacted; government by necessity is a major direct employer, as well as a indirect employer.

    Moreover, the BVI is a resource-poor locale. It lacks the natural resources (oil, precious metals, minerals, forestry, fishing) to establish a primary economy; it also lacks the resources to also establish a major secondary economy (manufacturing). The VI economy is a tertiary economy (service). Nonetheless, for the long-term, the teritory must diversify its economy to prevent the stumbling of one sector from causing the whole economy to tumble. Election season is in the air and will soon research fever pitch. As such, the politician campaign must include plans on how to strengthen, deepen, sustaining and diversifying the economy.

    Further, agree with Benito that the BVI must anticipate a worse case in regards to establish registers of beneficial ownership, per the UK’s amendment to the Sanctions and Anti-Money Laundering Bill. It must embrace and anticipate having to set up the registers; it must act urgently. Of course, independence is an option; though, as I have outlined in a recent article, the VI is not ready for independence.
  • here & there (12/08/2018, 13:17) Like (6) Dislike (3) Reply
    you can't just keep stuffing people and buildings into the BVI. It has finite capacity. More tourism sounds most
    profitable but already the place gets jam packed. Loosing its 'niceness'. Best to refuse to cooperate with any
    influences and devalue peoples rights and enjoyment of their lives. Turning the BVI into another Honolulu is
    terrible. And the knee jerk reactionism to demands for private information on individuals, was most disgusting
    and disgraceful. Because someone else behaves like an ass, doesn't mean the BVI should also.
  • Where’s the tourism plan? (12/08/2018, 17:52) Like (9) Dislike (0) Reply
    Assuming he was speaking to this group in NY to state that rebounding tourism is pivotal at this point. So where’s the plan? We’ve not seen one for years and they’ve had loads of fancy consultants at their aid. I’ve seen tourism companies here get back on their feet at no aid from Tourism Board .
  • Tony Stark (12/08/2018, 18:26) Like (6) Dislike (1) Reply
    It’s simple maths really, $135M divided by the number of people here paying taxes. There will be no deal, the UK know the recovery fund would end up in skiing trips and SUV’s which is why it won’t be handed over to government so they certainly aren’t going to do a deal involving financial services! This guy is on the ball, plan B and C need putting together fast!
    #andrewfahie
  • Ning (12/08/2018, 19:02) Like (2) Dislike (0) Reply
    They have no plan. As usual just reacting instead of facing reality and turning the situation to get the best for the BVI and its people. They are killing an opportunity to fight a battle and spend millions fighting it which is a DEAD HORSE!
  • NezRez (13/08/2018, 08:28) Like (2) Dislike (0) Reply
    Right after the hurricanes and even before, the question was “what if the financial sector was to go bust”? We never had a plan B set up. We had many good suggestions, yet nothing was done. Right now, the quickest and least expensive way to generate instant revenue, as I stated before, would be to have a BVI lottery, and not allow the U.S. lottery to be here. The U.S. lottery have been profiting here for years, so why not do our own? The party that is in now can get the ball rolling and whoever wins the next election MUST CONTINUE it. This is a start to our financial recovery because as of now, we have NOTHING!
  • TALK TALK TALK (13/08/2018, 19:36) Like (0) Dislike (0) Reply
    If we could talk our way out of this catastrophe we would all be millionaires. BVI is top of the line when it comes to talk shop. The party is over y'all now the rubber hits the road ready or not. All these bird brained ideas will not help. When we were in a position to do meaningful stuff like developing our fishing industry all we did was talk talk talk....now the shit has hit the fan and we continue to talk talk talk.
  • TALK TALK TALK (13/08/2018, 19:36) Like (1) Dislike (0) Reply
    If we could talk our way out of this catastrophe we would all be millionaires. BVI is top of the line when it comes to talk shop. The party is over y'all now the rubber hits the road ready or not. All these bird brained ideas will not help. When we were in a position to do meaningful stuff like developing our fishing industry all we did was talk talk talk....now the shit has hit the fan and we continue to talk talk talk.
  • Thinking (14/08/2018, 16:21) Like (0) Dislike (0) Reply
    OK - so the single biggest reason to use the three year work permit system already in the Labour law to get three years of fees in this year. Why are we waiting? Get. It. Done. Enable these firms to adapt, bring new product and mitigate whatever comes.

    We still need better and more seasoned advocacy in the UK and better PR to focus attention on all of the good business we are involved in and how that benefits the UK, EU and RoW. A brief stint from Gary Hales is not enough.
  • i said it (15/08/2018, 04:00) Like (0) Dislike (0) Reply
    I hope the U.K gives the BVI the independance that some people are dying to get. Let them strip all bvi landers of their british citizenship, their u.k passport and their BVI passport which incidentally is a british passport and property of the queen. Let the bvi print their own vi passport not associated with anything british as an independant country in the Caribbean this will fix everything and there will be no more complaints end of story.


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