President of BIBA, Marlon Waldron, speaking at yesterday’s seminar.
The international business sector is contributing as much as $1 billion to the local economy, but only some $8 million is allotted annually to promoting that sector.
This, says Marlon Waldron, President of the Barbados International Business Association (BIBA), is something that needs to be addressed. He made the comments while delivering welcome remarks at a seminar hosted by BIBA yesterday at the Savannah Hotel, under the theme “What Businesses Need to Know about BEPS and DTAS”, as he lamented that tourism promotion is allocated over $100 million a year.
“We are asking the powers that be, now that the country is aware of the impact of international business to our economy, to reconsider this disparity so that international business can reach its full potential and make the contribution we know that it can to the revenue and foreign reserves of Barbados,” Waldron added.
He noted that much of the blame regarding the country’s current economic reality has been placed at the feet of the international business sector. Waldron lamented that Government officials have, in referring to the shortfall of revenues of some $1.4 billion and lower corporation taxes collected by the Government, placed the shortfall at the doorstep of the International Business and Financial Services sector.
“One may see this as blaming of the International Business sector for the current unfortunate state in which our country has found itself as grossly unfair, especially when in good times it is not this sector that is given the credit for the country’s sound, healthy state in terms of its foreign reserves and fiscal position. In better times that credit is given wholly to a sector which, up to now, the nation has been encouraged to think of as our most important one. I believe we should find this very interesting. I take it in a very positive light; I see it as being at last a recognition of the immense importance of international business to Barbados and the valuable contribution it has been making over the years,” he said.
Nevertheless, Waldron admitted that the sector has had challenges, and will likely always experience challenges given the nature of the sector. But he maintained that its survival will depend on how we adapt and equip the domicile to take full advantage of the opportunities that will present themselves in spite of the challenges. He made the point as he argued that Government missed such an opportunity when Canada made changes to its laws, allowing exempt surplus treatment for profits flowing from countries which agreed to tax information exchange agreements with it.
“Some companies left Barbados and re-domiciled in zero tax jurisdictions. As a result of the relocation of four of those companies, Barbados lost about US$60 million in corporate taxes. One of the four companies which re-domiciled actually engaged the Government, requesting a solution. Needless to say, it was never given in a timely manner and that company left Barbados,” he said.
Waldron maintained that was the time that Barbados should have intensified its efforts in the market place. He further contended that there should have been an increase in the financial and other resources allocated to the development of the sector. (JRT)