With cross-border investment becoming increasingly complex due to international regulation and market volatility, even more so now with the turmoil of COVID-19, Jersey is working hard as an international finance centre (IFC) to provide clarity for global investors. Chief Minister Senator John Le Fondré, Minister for External Relations Senator Ian Gorst, and CEO of Jersey Finance Joe Moynihan explain how.
How do you see Jersey’s relationship with the UK and EU evolving as the Brexit situation progresses?
Senator John Le Fondré: Jersey’s constitutional position with the UK dates back to 1204 when the island was granted the rights to self-government and judicial independence by King John. The UK remains the island’s most important economic and political partner, and Jersey currently facilitates £500bn investment into the UK economy, which is worth approximately £5bn in tax revenues a year for the UK Exchequer.
The Government of Jersey will maintain our close economic and cultural links with both the UK and EU following the UK’s departure from the bloc. EU citizens living in the island make a valued contribution to our local community, making up around 20% of Jersey’s population, while Jersey has close relations with several EU member states including France, Poland and Portugal, including the regional government of Madeira.
What are Jersey’s strategic priorities post-Brexit?
Senator Ian Gorst: It’s critical that the island continues to develop its international identity and that we enhance existing relationships with the UK, EU member states and international markets – especially where we offer value through our financial services and digital sectors.
Our Global Markets Strategy aims to increase Jersey’s visibility, improve access to decision-makers, and facilitate business flows. That strategy also seeks to strengthen Jersey’s reputation as a high-value, well-regulated, IFC for target markets in Africa, Asia, the Gulf region, and North America.
How is Jersey positioning itself to take advantage of new opportunities?
Senator Gorst: We have established a dedicated team, which is working to strengthen our governmental links with partner countries in terms of commercial, political, cultural and educational cooperation. This includes a series of official and ministerial engagements and a range of international agreements and memoranda of understanding.
The Global Markets Team has developed its strategy through a cross-government process and with input from a number of non-government bodies, while we also maintain permanent representation in Brussels through the Channel Islands Brussels Office, a joint venture with the Government of Guernsey, and an additional regional office in Caen, France.
How does Jersey support global financial flows?
Joe Moynihan: Our focus as an IFC is on enabling global investors to put their capital to work where it is needed, efficiently and securely. An analysis of our industry shows that Jersey helps to mediate some £1.3tn of assets from all corners of the world – more than half of our new business now comes from markets beyond Europe.
It is clear that investors put their faith in Jersey for good reasons – the stability and security it offers, its legal and regulatory framework, and its commitment to transparency. Good quality capital seeks a good quality environment and Jersey ticks that box.
Of course, global flows continue to evolve. Sustainable finance is a core emerging area and digital innovation is fundamentally changing the landscape in areas like anti-money laundering. As a forward-thinking jurisdiction, we are constantly looking at ways to respond to these trends. Overall, investors are seeking specialist expertise to meet their increasingly bespoke needs and Jersey’s experience and focus on service quality are really resonating.
Jersey Finance recently opened an office in New York – how significant is this?
Joe Moynihan: Some years ago, we set out to diversify our links with markets around the world. That strategy has enabled us to broaden our network across Europe, Asia, Africa and now the US.
In the US, we feel Jersey can act as a gateway for fund managers to access the EU investor market, by giving them a cost-effective, simple, robust solution. In all our markets, we absolutely recognise the need to demonstrate our value, by working with partners to open up opportunities. Our New York office is a vital addition to our global network, putting us in a strong place to achieve that.
Expand a little on Jersey’s links with the USA?
Senator Le Fondré: Jersey has strong historic, cultural and economic links to the US. New Jersey of course, derives its name from the island of Jersey, having been awarded to Royalist George Carteret following the English Civil War.
During my visit to the US earlier in the year I supported the signing of a “Twinning” arrangement between St. Helier and Trenton, the capitals of Jersey and New Jersey. It is hoped this relationship will provide opportunities for cultural, educational and economic cooperation between the state and the island. As a reputable financial services centre, Jersey signed its first Tax Information Exchange Agreement with the US (in 2006), and the USA’s third largest financial services provider, CitiBank, recently celebrated its 50th anniversary in the island.