Dickson Igwe, Senior political contributor
Brexit will be a boon to the offshore finance industry in the short term, at least
Will Brexit be advantageous to offshore finance? The answer could well be yes.
The European Union is pro regulation on offshore finance for obvious reasons. The EU is much less of a deregulated economy, than a Post Brexit UK is likely to become.
UK Prime Minister Boris Johnson has asserted that he wants the UK to become a champion of global free trade and economic deregulation. In that quest, Boris Johnson’s UK and Donald Trump’s USA are on the same page. The USA today is booming economically, and the country has become a paradise for the super wealthy. Wealth inequality has increased dramatically in Donald Trump’s USA, however, working Americans appear satisfied with the economy, and there is a belief the country is doing ”great.”
A Post Brexit UK will shift to the right in terms of the economy. There is talk of a return to the Margaret Thatcher Era, with its stress on free trade, and a business first culture that favors the entrepreneur and businessman.
British Opposition leader Jeremy Corbin. Photo courtesy https://www.independent.co.uk/
The City of London will use offshore finance destinations to buttress its profitability as it hits a buffer in a European Union that is intent on replacing The City’s pre-eminence with European cities such as Frankfurt, Berlin, and Paris. Already a number of UK financial institutions have moved to European cities to protect themselves from the adverse effects of Brexit.
The Boris Johnson economy appears to be an economy that will encourage the wealthy to further increase their wealth. Jeremy Corbyn and his Labour Party on the other hand was not friendly to the wealthy and certainly did nothing to encourage offshore finance.
A Jeremy Corbyn Government would have created major road blocks for offshore finance. Corbyn wanted to tax the wealthy and reel in offshore finance in order to finance a socialist type economy that would have benefited the UK masses through massive social investment. This was anathema to the 1% and the UK press owned by the 1%.
The UK has always possessed a strong center right political culture. And apart from the dislike of Corbyn as a leader, Brits further possess a shop keeping culture. Conservative UK is a country that possesses a business friendly culture and is in love with small government. The less interference on the high street by government the better. And that is in spite of a strong socialist tradition especially in the northern part of the country. Boris Johnson made major inroads into the Left’s natural constituencies especially in the northern Labour strongholds.
It will take at least 5 years for the UK Left to rebuild, after the devastating loss of the December election.
Instead Boris Johnson states that it is his dream to transform the UK into a land of prosperity through deregulation, support for business, and free trade both nationally and internationally.
Some have stated that it is the Prime Minister’s dream to turn the UK into the world’s largest offshore financial center in the mould of Singapore. The Prime Minister also aims to leverage his friendship with Donald Trump to aggressively open up global markets through a northern Atlantic political and economic alliance: a New Special Relationship.
The preceding will be excellent for offshore finance centers, especially if Donald Trump wins the November 2020 USA Presidential Election.
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Dickson Igwe is an education official in the Virgin Islands. He is also a national sea safety instructor. He writes a national column across media and has authored a story book on the Caribbean: 'The Adventures of a West Indian Villager'. Dickson is focused on economics articles, and he believes economics holds the answer to the full economic and social development of the Caribbean. He is of both West African and Caribbean heritage. Dickson is married with one son.
