Nassau, The Bahamas — JAMAICA is presently more suited to provide back-end support to the lucrative offshore financial services market, according to a regional industry expert.

Hugo Innis, director at Barbados-based Kensington Finance, said several prevailing international and domestic factors make Jamaica not ideally suited for a leading role in the industry at this time.

“A number of key factors that may lead to establishing an IFC (international financial centre), maybe Jamaica might not fit the optics for,” Innis told the Business Observer yesterday at the Third Caribbean Conference on the International Financial Services Sector in Nassau, The Bahamas.

The establishment of an international financial services centre has been a key growth plan of the Jamaican Government for many years. The project aims to transform Jamaica into a financial hub via incentives similar to the Cayman Islands.

But Innis said crime is among the deterrents to establishing an IFC in Jamaica. Jamaica has one of the highest homicide rates in the world.

“No where is a financial services centre led in a country with high crime because one of the attractions of an IFC is that there must be movement of highly skilled people and what attracts highly skilled people is quality of life,” Innis said.

What’s more, he said that the cost of doing business in Jamaica maybe an issue. And challenges that IFCs are having with regulations and international diplomacy would also pose a problem for Jamaica if it should enter the industry at this time, Innis added.

“Of course cost may be an issue and meeting standards and so on because they haven’t had that track record,” he said.

The Bahamas has one of the most vibrant IFCs in the region, behind the famed Cayman Islands. The financial services industry of The Bahamas is the countryâs second largest industry, accounting for almost 20 per cent of GDP and when combined with business services, accounts for about 36 per cent of GDP, according to official figures. Barbados and Antigua are among the other regional countries that have relatively vibrant IFCs, which provide tax advantages to international investors.

The region’s offshore financial sector is coming under increasing scrutiny from developed countries that label them as nothing more than tax havens with inadequate regulation, facilitating tax dodgers and money launderers.

Innis serves as director of several offshore companies, subsidiaries of internationally publicly listed firms and venture capital funds.

The Barbadian financial expert said, however, that there is room for Jamaica at the back-end of the industry.

“The issues don’t stop Jamaica from having a contribution to make in the (IFC) sector but I don’t think it will be at the forefront, the water’s edge of the industry,” Innis said.

“Jamaica, as one of the largest entities in the region, can perform a lot of the back office functions related to IFCs and can support a lot of the smaller regions engaged in IFCs with the cadre of lawyers, accountants and other professionals that they have,” he said, adding that the country’s logistics and large English-speaking population is also a plus.