Speaking at the 77th session of the United Nations (UN) General Assembly, Prime Minister Philip Davis said The Bahamas is the victim of “inequitable and unjust” measures on the part of major economic actors and charged that evidence is mounting that the decisions to target vulnerable states has less to do with compliance and more to do with discriminatory perceptions.
The European Union (EU) will reportedly add Anguilla, The Bahamas, and the Turks and Caicos Islands to its list of non-cooperative jurisdictions during an upcoming meeting in October.
Davis said the decision is “unfair”, noting that developed countries with regulatory regimes similar to blacklisted countries are not even eligible for inclusion on these lists.
“We continue to struggle to recover from the economic shocks of hurricanes and the COVID-19 pandemic,” he said in his address on Saturday.
“We also have the additional battle with inflationary pressures, created not by us, but by the war in Europe.
“And now, to top it off, we are yet again the victims of inequitable and unjust measures on the part of major economic actors. All these factors place a stranglehold on our national development, and that of other small island developing states.”
Davis said the action taken by the EU is “profoundly unfair”.
“When we look at the countries that are flagged as high risk and blacklisted, several startling commonalities emerge,” he said.
“Why is it that European states that operate frameworks akin to that of high-risk or blacklisted countries, are not even eligible for inclusion on these lists?
“Why are all the countries targeted – all of them – small and vulnerable, and former colonies of European states?
“We find it astounding that the $2-$3 trillion dollars, which is estimated to be laundered each year through the developed countries, are never flagged as causes for concern.
“And yet, my country, which is widely recognized as one of the best-regulated countries in the world, and other countries like The Bahamas, are singled out for such reputational attacks? The robust regulatory regimes of our Central Bank, Securities Commission, and Insurance Commission are chastised on minor details of technical process, while much bigger transgressions in the developed world are ignored.
“The evidence is mounting, that the considerations behind these decisions have less to do with compliance, and more to do with darker issues of pre-judged, discriminatory perceptions.
“Black-governed countries also matter.
“Mr. President, we support the call for reforms in the global financial system to make it more relevant to the needs of today. But those reforms need ambition. They need to go beyond the incremental. And they need to apply to all.
“For example, the community of international financial institutions are in a position to forgive the debt incurred by the economic shutdowns during the COVID-19 pandemic. They should do so. Every year that we don’t do the right thing, the right thing to do becomes more expensive.”
In a joint statement on Friday, the Ministry of Finance and Office of the Attorney General acknowledged the decision by the EU and said The Bahamas is committed to closing the gaps.
The statement noted that shortly after the Davis administration came to power last September, it received notice of certain deficiencies related to the implementation of the Commercial Entities (Substance Requirements) Act, 2018, (CESRA) and the economic substance reporting that were found in the annual monitoring for 2019 and 2020.
“Our administration has worked diligently to satisfy the concerns of the European Union, however, not all deficiencies could be addressed before the determination of our review in April 2022,” it read.
“As of now, it is anticipated that the European Union will add The Bahamas to its list of non-cooperative jurisdictions. We are committed to closing all remaining gaps expeditiously and to seeking a redetermination of our status in the shortest possible time.”
Successive governments have long lamented the ever-changing goalposts of international financial watchdogs. The Minnis administration placed heavy legislative attention toward compliance, yet the challenges remain.
Under the Minnis administration, the country was blacklisted by the EU, France, and the Netherlands.
