Hong Kong, June 22, 2017 - The British Virgin Islands (BVI) enables global investment and trade which supports more than two million jobs worldwide – 150,000 of which are in the UK – according to a detailed report published today.
The report, Creating Value: BVI’s Global Contribution, undertaken by Capital Economics, an independent economics consultancy, analyses the significant global economic contribution of the BVI. It finds that the BVI mediates over US$1.5trn of cross-border investment flows, the equivalent to 2% of global GDP.
The report – the first of its kind – also finds that over US$15bn of tax revenues are generated annually for governments around the world, via investment mediated by the BVI and the resulting economic activity. The UK (US$3.9bn), the EU excluding UK (US$4.2bn) and China and Hong Kong (US$2.1bn) are the largest beneficiaries of this tax generation.
Coupled with the jobs it supports, the tax generation marks the BVI as a substantial net benefit to governments worldwide.
Commenting, Lorna Smith, OBE, Interim Executive Director of BVI Finance said:
“The results of this study clearly demonstrate the significant contribution the BVI makes to the global economy.
“Not only does the BVI enable cross border trade and investment, it both supports millions of jobs globally and generates substantial tax receipts for governments worldwide. This brings tangible benefits to the lives of employees, voters, families and businesspeople around the world.
“The report is unequivocal: contrary to some accusations, the BVI is a sound and reliable centre which has worked harder than many bigger nations to meet international standards, and it is not a tax haven.
“This independent and authoritative report is equally clear in stating that the BVI is not a centre for corporate profit shifting. This helps clarify once and for all some of the inaccuracies and misunderstanding about what the BVI is and the valuable role it plays in the global economy.”
Commenting, Mark Pragnell, Head of Commissioned Projects at Capital Economics and the report’s author said:
“The BVI provides the legal structures that allow companies, institutions and individuals to safely and efficiently carry out their business and make investments across international borders.
“The ‘BVI Business Company’ is a widely used and dependable vehicle to facilitate cross-border trade, investment and business. Over 140 major businesses listed on the London, New York or Hong Kong main stock exchanges use BVI vehicles to support their international investment activities. Similarly, major international development banks, such as the World Bank’s International Finance Corporation, use BVI Business Companies to help fund vital projects.
“Our report shows that the BVI is a global powerhouse for cross-border investment equating to a conservatively estimated $1.5 trillion across its 417,000 active BVI Business Companies.”
Of the 417,000 BVI Business Companies, roughly two-fifths originate from beneficial owners in Asia. Another fifth (18%) have ultimate beneficial owners in Latin America and the Caribbean, while the remainder are primarily in Europe and North America.
A summary of the report's key findings can be found here
The full report can be downloaded here
The report website can be viewed at www.bviglobalimpact.com post embargo.
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Notes to editors
Media contacts
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About BVI Finance Limited
BVI Finance is responsible for marketing and promoting the BVI’s financial services industry. More information can be found at www.bvifinance.vg, by contacting info@bvifinance.vg, or by following BVI Finance on Facebook, Twitter and LinkedIn.
About Capital Economics
Capital Economics is one of the leading independent economic research companies in the world. Our large team of more than 60 experienced economists provides award-winning macroeconomic, financial market and sectoral analysis, forecasts and consultancy, from offices in London, New York, Toronto, Sydney and Singapore.
We provide research on Europe, the Middle East, United States, Canada, Africa, Asia and Australasia, Latin America and the United Kingdom, as well as analysis of financial markets, commodities and the consumer and property sectors. Founded in 1999 by reputed City of London economist Roger Bootle, we have gained an enviable reputation for original and insightful research and have built up a wide and distinguished client base.
For more information, visit www.capitaleconomics.com.
About BVI House Asia
BVI House Asia was established as the BVI Government’s Representative Office in Asia to support and expand the strong relationship that the BVI has had with Asia Pacific region for more than 25 years. BVI House Asia allows the BVI Government to be responsive in real time, answering any questions about BVI business, and working with industry practitioners to increase knowledge and awareness about economic business opportunities, especially in the financial services industry. For more information, visit About us.