Vexed Bermoothes

The FT has a balanced article on the threats faced by the offshores including Bermuda.

“The political climate on the issue of tax havens has changed dramatically over the past three months,” says Jeffrey Owens of the Paris-based Organisation for Economic Co-operation and Development. As the official who has driven the international crackdown on secrecy for more than a decade, he says the new climate could turn the reform promises extracted from many offshore centres into a reality. The financial crisis has intensified the attack on havens. The near-collapse of the west’s banking industry has drastically increased governments’ need to raise funds, brutally exposed the risks inherent in small countries with large financial sectors, and raised questions about the role of offshore centres in destabilising the system …

Some locations have tried to diversify. Liechtenstein is the world’s largest false-teeth exporter. Monaco has more jobs in manufacturing than in finance. The Isle of Man has a foothold in the space industry and a lively manufacturing sector. Bermuda wants to break into the gambling business [aren't you pleased that we are being linked to this pie in the sky idea?]

Despite such efforts, the tax havens still fear a bleak future if the international firms of accountants, lawyers and bankers pull out. “They are birds of passage. If they up sticks and go somewhere else, unemployment would be dramatic,” says one official.

Dr. Brown may bray about “affront” but he’s got to grow up and realise that Bermuda is in for some rough handling.  The sooner he starts acting like an adult and working with our business customers and advisors, instead of pillorying them for short term political gain,  the better.