It has long been a topic of discussion, the potential for Jamaica to be established as an international financial services centre (IFSC). The proposed benefits are clear: job creation, increased government revenue, real estate development, diversification of Jamaica's economic base, and an increased presence of Jamaica on the international financial market.

Over the years, we have witnessed our Caribbean neighbours take advantage of these lucrative business opportunities. The most well-known offshore centres are, of course, Bermuda, The Bahamas, The Cayman Islands and the British Virgin Islands. Barbados, Antigua and Barbuda have also successfully tapped the international finance market and enjoyed a great deal of economic development from it.

With Trinidad and Tobago also ushering in plans to obtain IFC status, it is no surprise that some would anticipate a crowding of the Caribbean market for international finance. For this reason, it is absolutely essential that our endeavour be focused and specialised, exploiting specific market niches and harnessing our competitive advantage.

Trinidad and Tobago, for example, is seeking synergies with its energy sector and Bermuda has established itself as a major player in the insurance market. While Jamaica is looking to offer a range of products and services including regional treasury management and fund management, we have taken special interest in the area of sports and entertainment/copyright financing. With Jamaica as a highly marketable brand in the sports and entertainment industries, particularly after our recent success at the Beijing Olympics, we propose to attract sports figures and entertainers from all over the world to have their offshore planning done in Jamaica.There are also some low-hanging fruits, such as the shipping industry. We could develop an international ship registry within the concept of an international shipping centre, a 'one-stop shop'. This is an area with great potential for job-creation. This initiative would build on and integrate the achievements made by Jamaica's shipping industry thus far in the areas of cruise shipping, container transhipment and production of quality seafarers.

Another niche market of consideration, despite the near competition from Bermuda and Cayman, is captive insurance. We would ensure that our jurisdiction competes on cost and availability of a high-level of professional providers.

The international financial crisis

As such, we begin to answer the key question: What does Jamaica, a highly indebted island-state, have to offer to international businesses? We have a cache of professionals including over 1,000 chartered and qualified accountants, scores of MBAs and hundreds of lawyers. We have a strong regulatory framework and finance is already one of our fastest growing sectors. We are highly ranked for the quality of our transportation infrastructure, especially our airports, which are well served by major carriers from the USA and from Europe. Also in our favour is our history as a stable democracy, proximity to the world's largest market (the USA) and our availability of training facilities for professionals in the financial industry.

Certainly, the international financial landscape has been forever changed by the events that have taken place over the last year, including the failure of major institutions such as Bear Stearns, Lehman Brothers and Merrill Lynch. International banks have become increasingly prudent, reducing costs, laying off staff, writing down bad debt and implementing more stringent lending criteria.

Jamaica can use this time of downturn to craft a legislative and regulatory framework that encompasses the new standards being developed in this contracting economic climate. We have the opportunity to get things right the first time by recognising the importance of banking regulation and the need for proper supervision of financial entities.

The way forward

In time, the global economy will recover and investors will return. Proceeding with development now, therefore, will ensure that Jamaica is in a position to take full advantage of the inevitable upswing in the global economy. With an aggressive marketing campaign, we will be most appealing when international businesses begin to expand again.

The IFSC special advisory committee was charged with the responsibility of assessing Jamaica's potential for entry into the international financial services market. The committee, based on the findings in a report by KPMG, has recommended that Jamaica enter the market as a mid-value competitor with a strategy for developing into a Centre of Excellence. As a mid-value competitor, we would focus on smaller niche markets (as mentioned earlier), exploiting tax treaties and/or special access to larger markets. In this model, most service provider jobs will be performed by local professionals.

With regards to implementation, the Cabinet approved last month the establishment of a statutory company to oversee the development of the IFC. Next steps include the immediate drafting of appropriate legislation and the refinement of the list of products and services that will be offered in our jurisdiction.

In the medium term, we plan to explore avenues of collaboration with some of the other IFC jurisdictions such as the BVI, Cayman and The Bahamas. The initiative will also require maximum cooperation among all the stakeholders, public and private sector alike.

The IFSC will attract critical investment, and the creation of a new industry will serve as part of the solution to our economic problems.

Don Wehby is minister without portfolio in the ministry of finance. Feedback may be sent to don@mof.gov.jm or columns@gleanerjm.com.