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Editorial Comment
Economic growth goes on
Agreat deal of effort has been made by Gibraltar to reposition its business appeal to reach new market sectors and expand on existing strengths – with some initial success!
As articles in this edition of Gibraltar International reveal, firms are either expanding their existing operations or choosing to locate their operations on The Rock.
Employment, led by the private sector, has never been higher, amongst Gibraltarians – there are fewer than 200 unemployed. – and added to the territory’s highest annual GDP to end-March of £1.9bn. The 12,000 British, Spanish, other EEA and third country citizens crossing the frontier every day to work in Gibraltar account for approaching 50% of total employment.
Whatever may happen as a result of the internal wrangling over the form of UK Brexit, Gibraltar is taking no chances and planning on “a hard Brexit”, as James Tipping, the territory’s Finance Centre Director, told the EU Committee of Inquiry into Money Laundering, Tax Avoidance and Tax Evasion.
However, it is “with a firm commitment from the United Kingdom government to maintain and broaden access to their financial markets from Gibraltar,” he said, adding pointedly that “we will be the only territory in Europe with automatic access to the United Kingdom in banking, insurance, investment services and any other similar area where cross- border [EU] Directives currently apply.”
That set a marker with which to compare other EU jurisdictions such as Malta, Cyprus, Luxemburg and Ireland, for example, some that may seek to take advantage of Gibraltar’s enforced disengagement
with the huge trading bloc. Continued access to the UK, the world’s 5th largest economy, has proved appealing to insurers, some relocating from the UK and others on the cusp of moving to The Rock with UK-facing business plans. It’s a similar story with eGaming firms that continue to add staff, despite a spate of mergers and rationalisation measures.
The Financial Services Commission is working on at least five insurance company licence applications submitted in April and May, together with four general and life businesses, adding to the 61 insurance entities already licensed.
Artex International, the territory’s largest insurance manager, expects to take on another 5 or 6 insurance enterprises , the majority UK-focused and some prepared to relocate part or all of their operations to another EU location if ‘passporting’ rights eventually are not secured.
The fledgling fintech sector has been boosted by expected regulation from the year end for firms using distributive ledger technology for crypto currency, crowdfunding ‘tokens’ and other blockchain financial services applications; the interest in Gibraltar from start-ups is described as “remarkable”.
Yet with the spread of internet technology comes certain widespread fraud and ransomware, so it’s apt that Governor Lt. Gen. Ed Davis is leading the charge to alert and educate businesses and individuals on The Rock to the threats and how to combat them.
Financial services continue to do well despite Brexit uncertainties, but the Chamber of Commerce considers “it is sometimes painful to do business in Gibraltar and it will not get easier unless there is a root and branch change of attitude. This has to start with and be led by government!”
Ray Spencer
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4 Gibraltar International www.gibraltarinternational.com
Contents
News p6
Brexit concerns overshadow record budget result
Budget p8
Budget 2017 – tax measures
Insurance p10
Newcomers confounding Brexit uncertainty as focus intensifies on solvency compliance
Funds p14
Revamped regulation of Gibraltar funds
Aug/Sept/Oct 2017
Volume 23/Number 3
Cybercrime p16
Establishing ‘community of partners’ to combat internet crime
Private foundations p18
Gibraltar Private Foundations legislation a significant addition
Fintech p20
Businesses using new technology showing ‘extraordinary interest’ in new controls
Funds p26
Gibraltar Funds & Investments Association (GFIA)
Business round up p28