OECS leaders end summit, criticises Europe over blacklist
ST. GEORGE‘S, Grenada, 30 June, CMC – Leaders of the Organisation of Eastern Caribbean States (OECS) have ended a meeting here criticising the European Union over its decision to black list several Caribbean countries as tax havens.
In addition, the leaders of Antigua and Barbuda, Dominica, Grenada, Saint Lucia, S. Vincent and the Grenadines, Montserrat, St. Kitts-Nevis Anguilla, the British Virgin Islands and the French island of Martinique, who met here on Monday, also agreed that the issue would be further discussed at the Caribbean Community (CARICOM) summit that opens in Barbados on Thursday.
“We said we are going to aggressively pursue getting this thing to be removed. It is not a positive assessment so therefore it is something we must move to get rid off and that’s why collectively we are going to do whatever we have to do and we are taking our case to the CARICOM region, because Barbados was also named,” said OECS chairman and host prime minister Dr. Keith Mitchell.
“Historically Barbados is known as the most compliant country in the Caribbean, so having Barbados on the list makes the thing even more ridiculous,” he added.
“It is a big surprise, the methodology used in assessing those countries is quite flawed and in fact I believe today it is more an embarrassment to the European Union than the original statement that they made. It is a big embarrassment to them,” Mitchell told reporters at the end of the summit on Monday night.
Antigua and Barbuda Prime Minister Gaston Browne, whose country was among the 13 Caribbean nations listed by Europe as being tax havens, said the list is flawed and even baffling given that the official regulators, including the Global Forum, in Europe had found the Caribbean countries to be very compliant.
“There was no prior warning, and we note too that the countries in Europe with whom we have significant trade relations, the United Kingdom as an example, Germany, France, they did not make any such assessment.
“However there are some other countries with whom we have little relations and I believe too they have little knowledge of the Caribbean, they have deemed us to be uncooperative …and they have also classified us as tax havens.
“But the issue is whether or not they have any such locus and we are of the view that they do not have any such locus,” Browne said, adding “clearly these justifications are not only unjust, these countries have no locus to make any such classification”.
At least 13 Caribbean countries have been named by the EU which said the blacklisting comes amidst a crackdown on multinational companies trying to avoid paying tax in the 28-nation bloc.
The European Commission is proposing reforms to end sweetheart tax deals following a series of investigations into arrangements between EU countries and firms including Amazon, Apple and Starbucks.
Last week, the Head of the Delegation of the European Union to Barbados and the Eastern Caribbean, Ambassador Mikael Barford, said that the decision to release the list of international tax havens should not be regarded as an attempt to blacklist any country.
He said “the criteria may not be blacklisting, in a traditional sense, as it is very often perceived.
“It could even show what a specific EU member state believes are low tax rates or a harmful tax regime…that is something that these countries need to find out”.
Barford assured that it is “not likely” that there will be any effect on the credit ratings or private investments for the Caribbean countries which were listed.
“The approach had a totally different purpose and is geared towards improving a harmonized EU assessment in the future”.
But Prime Minister Browne told reporters he believes the move by Europe is as a result of competition, adding “the irony about this several of the countries in Europe, who shall remain nameless for the time being, they are really known tax havens.
“I mean they have low rates of taxation than we have here in the region, some have very low levels of corporation taxes in order to attract business and clearly they are really the tax havens. In fact when you look at the total trade within them within our region it is very miniscule compared to some of those countries in Europe and their low tax regimes.
“So it is probably a competitive issue to stop the flow of capital to the region, but then again they probably need to look within their own region before they make those external assessments,” he added.
The sub-regional leaders described their one-day meeting here as “very successful” with Mitchell indicating that “I think we have achieved precisely what we set out to do”.
The meeting here gave a 2017 deadline for removing the obstacles to the free movement of goods and people across the Economic Union.
Mitchell told reporters that regarding transportation, it was generally agreed that efforts must be made to improve inter-island travel and noted the complaints made by judges, who have had to wait for long periods in airports before reaching their destinations.
“We have to deal with it more aggressively,” he said, with Prime Minister Browne noting that the free movement of goods and people were the fulcrum to the success of any economic union.