Since the leak of the Panama Papers, there has been a global outcry against offshore financial jurisdictions. And, as a result, two stereotypes have been supported: that all offshore financial jurisdictions are used to hide money, and that these jurisdictions erode the health of the global economy.
But, in reality, the government of Barbados says offshore jurisdictions that are ethical and transparent can help boost economies. “Government-to-government secrecy can be used as a cover for illicit and illegal activity,” concedes Barbados business minister Donville Inniss. However, Inniss adds regions such as Barbados have long embraced the exchange of tax information between governments.
For example, the region uses a network of double taxation and bilateral investment treaties, which are agreements that help stimulate global trade. So, where Canadian companies have done business with Barbados, there have been “significant trade, employment and tax benefits to the economy […] The use of Barbados by companies generates between 26,000 and 31,000 additional jobs in Canada,” says Dr. Walid Hejazi, associate professor of International Business at Rotman School of Management, based on his research.
The goal, he adds, is for countries to focus on “deepening relationships with [offshore jurisdictions] that have enhanced transparency.”
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