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Brexit
Continued from p14
crashed out of the EU. Essex reported that KPMG’s chief
economist thought 10% depreciation was likely. “Clearly, if there is no deal the Euro will fall against the dollar as well, so the relative position is not as stark between Sterling and the Euro and the dollar. But it’s likely to be a bumpy road.”
The effect of currency fluctuations was often overlooked, Lottoland’s Garcia observed. “A lot of people find Gibraltar attractive, because we have Spain and the quality of life there is far greater. In the past we have had to consider what we might do if that quality is no longer as accessible. It’s a factor that a ‘no deal’ vote could trigger and that would be a significant issue for us”.
Productivity advise
Essex foresaw a gain for Gibraltar. “Productivity, automation, artificial intelligence and coping with people who don’t want to work is going to be the biggest economic and intellectual challenge for Britain over the next 10 years, and if it comes to having to do more with less resources, you [Gibraltar] are going to become an expert in that
and it will present an opportunity to advise the UK on how to deal with its tightening labour market. Gibraltar becomes the expert on productivity”.
Cawdery fretted that the UK focus had been on The Customs Union, of which Gibraltar is not part. “The border is the big issue – mobility of people. We still struggle to attract and retain people to come to Gibraltar – finding people is one of our biggest issues - and if there is a closed border, it will only get harder.”
Until recently he had been confident about the potential for trade deals and writing insurance risks in the US, South Africa, Australia, or in other Commonwealth countries. “What has dampened my enthusiasm is the BoE report which showed the projected benefit is very, very small,” he declared. “That being said, ‘very small’ in UK terms, could have a big impact on Gibraltar’s economy,” Cawdery conceded.
Gibraltar legislation for the Brexit-related ‘Temporary Permissions’ regime covers non-UK firms wanting to carry on business and deems those firms authorised for a period of time, during which they can apply for compliant authorisation, or wind down operations,
mirroring the UK approach. There are over 3,000 firms that can passport into Gibraltar from non-UK jurisdictions, but the GFSC doesn’t yet know how many are operating in Gibraltar.
Gateway opportunity
Taylor professed, “as much as we didn’t want Brexit, there are opportunities from European firms looking at Gibraltar as a gateway into the UK. As a regulator, we see a great deal of opportunity.”
Danny Gibson, founder and chief executive of CGICE, a company specialising in the EU insurance of security and defects, questioned how regulators might deal with companies that “don’t pay out on claims in Europe” post-Brexit legislation was not in place to allow insurers to do so.
“We appreciate that for insurance companies it is fraught – on the one hand they should carry on paying claims, but on the other hand, the legal right to do so may not be there,” the GFSC’s Taylor said. Negotiations were in progress across the EU, and he observed: “It’s a brave regulator anywhere that stops insurance companies paying claims”.
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