PM Davis accuses international financial regulators of discrimination

Prime Minister Philip Davis says there are elements of racism in the motivations of developed countries as they push for greater regulation of financial services sectors in ‘black-ruled’ states and former European colonies .

In his address to the United Nations General Assembly today, Davis said the Bahamian financial sector is one of the best regulated in the world, but has come under attack from international bodies such as the Union European Union and the Organization for Economic Co-operation and Development (OECD).

“Why is it that European states that apply frameworks similar to those of blacklisted countries are not even [considered] eligible to be on this list? Why are all countries targeted, small and vulnerable and former colonies of European states? ” He asked.

“We find it staggering that the two to three trillion dollars, which are estimated to be laundered in developing countries, are never reported as matters of concern.”

He said evidence was mounting that these attacks on the financial sectors of small states are not driven by conformity but “darker issues of biased discriminatory perceptions”.

“Black-ruled countries matter too,” he said.

Davis said his government would support efforts to reform the global financial sector, but that should apply to all countries, not just some.

Barbados Prime Minister Mia Mottley made a similar appeal to the US Congress last week when she testified at a special hearing of the House of Representatives Financial Services Committee titled: “When Banks Leave: impacts of risk reduction on the Caribbean and strategies to ensure financial access”.

She said that Caribbean Community (CARICOM) states had lost more than 30% of their correspondent banking relationships due to unfair and arbitrary classifications of the regional financial sector by the Financial Action Task Force (FATF) and the OECD.

“These correspondent banks, over the last 10 to 12 years, have felt that we are just too small, as I just told you, to get involved because increased due diligence means increased cost of regulation, increased compliance costs. And instead of doing business with us, they say, ‘Thank you, but no thank you.'”

She noted that the pressure is pushing some countries to go underground in their financial dealings and that this defeats the purpose of financial regulation.