Low tax rates allow companies to flourish and expand

Marion Williams, Governor of Barbados’s Central Bank, explains, “Our role is to ensure that the financial system is sound.” The Bank has been doing its job well. Barbados is steadily diversifying its economy while retaining its status as a low-tax jurisdiction. Williams explains, “We find that low tax rates allow companies to flourish and expand.”

Marion Williams, Governor Central Bank

Barbados is not a tax haven. However, it has reduced the maximum tax rate on firms in the international financial sector to only 2.5 percent, a policy that has attracted many companies to set up a business on the island. Once there, they tend to expand because of Barbados’s many advantages as a business base. Following the recent G-20 Meeting in London, the OECD released a report on financial centers around the world which placed Barbados among a group of jurisdictions (including the United States, the United Kingdom and other developed countries) that have substantially implemented the internationally agreed tax standard. As Williams says, “Our greatest strength as a jurisdiction for capital investment is the competence of our people and the high level of education of our labor force, which is also English-speaking. In addition, Barbados is very safe, stable, and strategically located.”

The Central Bank supports the government’s drive to attract more international investment and tourist visitors from the United States as well as from Barbados’s top traditional markets, Canada and the United Kingdom. In the tourism sector, Barbados has a very good track record for repeat visitors. As Williams puts it, “Once you come here, you tend to return.”

The Central Bank is working with other government institutions to step up marketing efforts for Barbados worldwide. Williams concludes, “We want to familiarize people with the advantages of doing business in Barbados. Barbados is very high up on the totem pole in key indices concerning development, anti-corruption, transparency, and more.”

Invest Barbados

“We work behind the scenes to speed things up.”

Wayne H. Kirton, CEO

Invest Barbados is helping to bring top-quality investments to the island. The organization, created in 2005 by an act of Parliament, aims to attract investment, promote exports of Barbados’s services, and provide research and development that will support the country’s economic expansion and help local service companies position themselves more effectively in international markets.

Invest Barbados aims to make Barbados a top choice for foreign companies looking to set up operations abroad. It also works to promote investment in specific sectors, including infrastructure, and to help make sure local services providers that are export ready are given a chance to develop export markets. The Invest Barbados web site is an invaluable source of information on doing business in Barbados.

Wayne H. Kirton, CEO, explains, “We are constantly tweaking our products and making sure we are competitive, and we are a virtual one-stop shop for investors. One major role we play is facilitation – we set up meetings for foreign companies that want to come to Barbados and then we work behind the scenes to speed things up for them.”

Invest Barbados is very proactive in promoting the country at international conferences and events, and it organizes numerous networking opportunities to bring potential investors into contact with local partners and government leaders.

Kirton says that Barbados has established double tax treaties with some 18 countries, including Venezuela, China, and the Netherlands, and bilateral investment protection agreements with 10 countries. He notes that Canada has been a major source of investment in Barbados, and adds that Invest Barbados has plans to sensitize United States investors to Barbados’s potential benefits, pointing to independent studies that show that when companies establish a presence in offshore financial centers like Barbados, this enables them to become more competitive globally, resulting in increased tax revenues and jobs at home. “We need to communicate that to the American audience, and point out the fact that being in Barbados can significantly boost a company’s exports.”

The Chamber of Commerce’s Mission is to continue to add value for their members

Glenda Medford, President Chamber of Commerce

The Barbados Chamber of Commerce and Industry is a voluntary non-profit association of business people which was established in 1825. The BCCI has recently implemented a new structure to respond more directly to the needs of the business sector. Glenda Medford, President, explains, “We now have representatives for each major sector including tourism, manufacturing, retail, and banking on the Council.”

In addition, we have created four working Committees, Social and Community, Member Development, Economic Policy, and Business Environment which allow members to be more actively involved.

Prior to the signing of the Economic Partnership Agreement with the European Union in October 2008, the BCCI in conjunction with the Private Sector trade team, was active in ensuring that members’ views were collated and represented in the negotiations. “The EPA is a very complicated instrument and the average business man would not have time to review the document to understand how to leverage the benefits available. We are therefore going to be working with the Ministry of Foreign Affairs to ensure the opportunities for the private sector are fully exploited. We are also looking for new ways for the private sector and the government to work together to take advantage of the EPA,” Medford says.

One current priority for the Chamber is to help its members cope with the impacts created by the global financial crisis. “Businesses must continue to exercise prudent financial management and manage costs whilst looking for opportunities to stimulate activity. It is important for employees to be even more productive at this time. Barbados has been hailed as a model for the Social Partnership – the collaborative arrangement between the private sector, Union and Government, and this crisis will certainly put this partnership to the test. This is also an opportunity for our businesses to explore new markets for imports and exports,” Medford comments.

With respect to Barbados as a place for business, Medford says “You have to look at the whole package. Barbados has good international airline connections, good standard of living, and excellent state of art telecommunications. We also have excellent beaches and restaurants which delight our visitors.”

Welcoming American investors, companies, and visitors to Barbados, Medford concludes, “Barbados is a good place to work, live, and play. At the Chamber of Commerce and Industry we welcome enquiries about doing business in Barbados, and remain committed to add value for all our members.”

Butterfield Bank

“Our primary goal is to increase market share in the highly competitive Barbados Retail Banking Sector.”

Lloyd Wiggan, Managing Director

Butterfield Bank is much more than a Bank. The dynamic financial services group with a corporate history that goes back more than 150 years, opened its Barbados operation in 2003. “We are re-branding globally to be known as just Butterfield to reflect the fact that a lot of what we offer our customers goes beyond traditional banking services,” says Lloyd Wiggan, Managing Director of Butterfield Bank (Barbados) Limited.

Butterfield Barbados, a fully owned subsidiary within the Bermuda-based Butterfield Group focuses on community banking. “Against a backdrop of global economic turmoil and economic decline, Butterfield in Barbados had a very good 2008, generating record net income and recording strong growth in our credit businesses. We will continue to enhance our product offerings and expand our branch network for the convenience of our customers,” Wiggan says.

Wiggan also had praise for the Barbados regulatory environment. “Barbados has one of the best regulated financial markets in the world, characterized by high standards and competent oversight,” he says. He commented further on other advantages of Barbados which include an excellent infrastructure, a well-established parliamentary democracy, low crime rate, and an outstanding reputation as a high-end tourist destination.

The Butterfield Group has operations in London, the Cayman Islands, Guernsey, the Bahamas, Switzerland, Malta, and Hong Kong, as well as in Bermuda and Barbados, giving Butterfield Barbados, international reach as well as in-depth local expertise.