Ladies and Gentlemen of the media Good afternoon and welcome to today’s press briefing.
Last Monday, when I delivered the Budget Address, I gave the people of this Territory an account of my Government’s stewardship in managing their affairs over the past three years.
In that address, I spoke about our many accomplishments, plans, challenges and our vision to further development of our people and this Territory.
In explaining our economic performance, I announced that the British Virgin Islands returned to positive growth in 2013, with the Gross Domestic Product (GDP) increasing from $909.4 million in the previous year to $923.2 million in 2013. This growth was driven largely by growth in the tourism and construction sectors, with communication, real estate and rental and business services playing a role, and accompanied by sustained performance of our financial services sector.
I have laid out my Government’s fiscal strategy, pragmatic strategy and implementation plan to further strengthen growth and secure our future.
We are on the right track. We are vigilant in maintaining the buoyant economy of the BVI, the hard work and determination of the people of this Territory.
We will continue to look after the wellbeing of our citizens; develop our youth; protect our national assets, and build a solid infrastructure. We will continue to improve the quantity, quality and variety of work for our jurisdiction.
We will continue to strengthen the BVI Brand and steadily get back the level of savings in the reserves where we could borrow without having the United Kingdom look over our shoulders.
Also, we will continue to make sure that our citizens enjoy world class health facilities and treatment in the new hospital. We will continue to strengthen the education sector to meet regional and international standards to maintain our economy on the cutting edge of development and innovation.
Furthermore, we will continue to invest in our network of roads and we will work hard in building a proper sewerage system, and we will work diligently with the situation we inherited to ensure that there is running water in our pipes.
More importantly, we will ensure that our visitors continue to enjoy the tranquillity and beauty of the BVI. And, we will continue to work hard with our farmers and fishermen to help them to lead productive, lucrative and fulfilled lives.
Indeed, we are moving forward and building a better Virgin Islands through Strengthening Growth; Securing our Future.
I will now turn my attention to the security breach in the banks.
Within the past few days the VISA debit cards issued by a couple of banks stationed here in the British Virgin Islands have been compromised.
Our banking regulator the Financial Services Commission, has moved swiftly to address this problem, and as of this date we can confirm that appropriate action has been taken to ensure that the requisite steps to safeguard the accounts of the customers of these banks have been taken.
Some customers within the British Virgin Islands have been affected, although as of now, it certainly appears that the numbers have been quite low. I am also assured that the banks will take the actions necessary to ensure that compromised accounts will be reinstated to their correct balances.
Ladies and gentlemen, the protection of the financial assets of the citizens of this society is of highest priority for this Government, and we believe that each and every person in this Territory who has accounts in the banks here, must be assured that their deposits are always secure.
It is also a fact that although the banks in the BVI are also very closely regulated, and although deposits in their main branches are insured by the likes of the Federal Deposit Insurance Corporation (FDIC). These deposits are not, and have never been insured in the BVI.
In the event therefore, of the very highly unlikely event of a failure of a bank in the Territory, the individual account holder is not protected from their financial assets in the relevant bank being lost without direct cash injections to cover these losses by Government.
To address this matter, and also to implant the mechanisms that would prevent a bank failure, and I have been pursuing this matter for several years, Governments worldwide generally go a step further that mere regulation and implement deposit insurance programmes.
Pursuant to this we currently now have in draft, legislation to insure the deposits of account holders in the BVI for up to one hundred thousand dollars ($100,000.00) per account. This will happen through the establishment of the deposit insurance system, much like that of the FDIC and the CDIC and is scheduled to be brought into effect in 2015.
Up to late last week I held discussions with senior officials in the International Association of Deposit Insurers (IADI) and the CDIC with a view to having a Virgin Islands Deposit Insurance Corporation (VIDC) up and running. We are already associate members of the IADI.
Lastly, My Government continues to do what is necessary to build a thriving and sustainable financial services sector.
On August 12 of this year, my Government engaged a global management consultant to assist us with charting a new direction in the BVI financial services industry. Charting a new direction was as a result of financial services stakeholder meetings held early on in my administration.
From August 12 to mid-November, the project team facilitated the project committees, one of which was chaired by me. The committees were made up of public sector representatives, a wide cross section of domestic private sector practitioners and other BVI international practitioners in Latin America, Europe and Asia. The consultancy was undertaken in three phases, including a review of other work previously undertaken by the Government of the Virgin Islands.
The review is now in its final stages of completion, with concrete recommendations for a strategic vision for the industry and plans to sustainably build the sector. We are currently at the stage of considering the recommendations of the consultants and believe it is a good time to share the preliminary results with our key stakeholders.
The importance of our financial services industry cannot be underscored. In this regard, the Government of the day and the Opposition of the day have always worked together to ensure this sectors remains sustainable and prosperous.
We are proud of this achievement and are committed to continuing this practice.
We invited members of the Opposition to a special informal meeting of the House of Assembly last week to share the preliminary findings, and having recognised that the wider public plays a critical role in the success of this industry, we held a Public Eye programme to discuss the same.
The interaction was indeed fruitful as members of the community called with thought-provoking questions.
In the coming weeks we will be finalising the recommendations of the report, taking into consideration the feedback from all stakeholders. At the appropriate time, a copy of the final report will be made available.
My Government looks forward to the support of the community as we work together to secure our future.