The chair of Cayman Finance has been quick off the mark again to respond to what he described as a “grimly ill-conceived metaphor” by Lord Myners, the UK’s City of London Minister, who compared the Cayman Islands to Afghanistan and Columbia in a recent parliamentary debate in the UK.
Anthony Travers wrote to the Financial Times, which is where Myners’ comments were quoted, to take the Lord to task about his suggestion that offshore financial centres, like addicts, should be "weaned off tax if that is the only source of competitive advantage that they offer."
Travers, the chair of the Cayman Islands Stock Exchange and Cayman’s financial industry body (formerly the Cayman Islands Financial Service Association but recently renamed Cayman Finance) suggested in his correspondence with the UKs leading financial broadsheet that there was an irony in the comments quoted in the article Tension eases as London backs Cayman loan on 1 October.
Myners had stated that low taxation might not be a sustainable economic model for offshore centres. "In the same way as we are having to wean the farmers of Afghanistan off the poppy and the farmers of Colombia off coca, we have to wean offshore financial centres off tax if that is the only source of competitive advantage that they offer," the UK Lord and financial minister said during a debate.
Travers suggested that Lord Myners take a look in the mirror. “It is better argued that it is the UK government's addiction to high taxes and irrelevant regulation that is causing the diminishing benefits to the UK Treasury, and indeed if the EU initiative is not derailed, UK taxable income will decline further and Chancellor Alastair Darling's woeful projections will look increasingly optimistic,” Travers wrote in defence of offshore financial service centres.
“Rather than the drug-crazed one-trick ponies Lord Myners suggests, it is the comparative clarity of a superior legislative regime, an indirect tax system and a relevant regulatory approach that is the cornerstone of the Cayman financial model. No Cayman financial institution has failed, and Cayman continues to experience net inflows of business.”
Travers pointed out for the umpteenth time that throughout the financial crisis the Cayman Islands debt to gross domestic product ratio has been less than 30 per cent of the real UK figure. “The Cayman budget today will again be balanced,” he wrote in a letter published on Tuesday. “Perhaps there is a message here to those with clarity of thought. Lord Myners: do get the metaphor straight.”
With a persistent distortion of the facts in the international media regarding the situation in the Cayman Islands, Travers, as an increasingly high profile spokesperson for Cayman Finance has had his work cut out for him recently as criticisms of the jurisdiction mount and he seeks to counter those criticisms wherever they are made.