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CARICOM | EU Blacklists Cayman Islands as Britain withdraws from the European Union

  • Written by Calvin G. Brown -Wiredja.com
  • Published in Business & Economy
Cayman Islands added to the EU's economic blacklist Cayman Islands added to the EU's economic blacklist
MONTEGO BAY, February 29, 2020 - Yet another member of the Caribbean Community has been blacklisted by the European Union. This time it is the Cayman Islands which was earlier this month slapped with punitive measures by the EU.

Cayman joins Trinidad and Tobago and the US Virgin Islands  and Panama as countries from the Caribbean affected by the EU sanctions.

The EU’s inclusion of the Cayman Islands in its blacklist regime came as a surprise because that territory was thought to be compliant with legal requirements.

However, according to the UK Guardian newspaper, “the decision will be seen as a shot across the bows of the UK ahead of negotiations on the future relationship with the bloc,” as Cayman is a British Dependent Territory.

At the recently concluded 31st CARICOM Inter-Sessional meeting in Barbados, the communique stated that heads of government “deplored the ongoing unilateral, arbitrary and non-transparent blacklisting strategy employed by the EU and now by individual European states like France and the Netherlands.”

The Caribbean leaders said they ““viewed the strategy of blacklisting and de-risking, which lead to the withdrawal of correspondent banking services, as an existential threat to the economic security of CARICOM Member States.”

The CARICOM leaders, observed that the EU measured could have serious financial repercussions on vulnerable nations within the regional grouping and their ability to attract the investments needed to build resilient economies.

“The measures have the potential of causing devastating economic, social and political consequences for our states as a result of the harm that will be inflicted on our global image, our economic competitiveness and resource mobilization efforts,” the leaders stated in a communique.

“Heads of Government agreed that the ongoing actions of the European Union constitute a blatant violation of their sovereignty,” and called “for the creation of an appropriate intergovernmental tax body with the adequate means and powers to set standards and rules which support an equitable and universal approach to an international tax governance infrastruc­ture.”

The list, which was set up in 2017 after revelations of widespread tax evasion and avoidance schemes, now includes 12 jurisdictions.

Adding financial centres like the Cayman Islands and Panama marks a shift for the EU. Several reviews had left on the list mostly Pacific and Caribbean islands with almost no financial relation with the EU - drawing criticism for being too lenient on tax havens.

The other listed jurisdictions are Fiji, Oman, Samoa, Trinidad and Tobago, Vanuatu and the three U.S. territories of American Samoa, Guam, and the U.S. Virgin Islands.

Those on the blacklist face reputational damages, higher scrutiny in their financial transactions and risk losing EU funds.

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  • Countries: Cayman_Islands