Jersey’s financial services industry has demonstrated an innovative and resilient approach to many years of change in the global economy. Our ability to maintain a successful international finance centre has been facilitated by our talent for adapting to market conditions and business needs.
We have done well to avoid much of the complacency that comes from assuming existing products and markets will never change. We need to keep up this nimble approach to global developments.
In the past we had more business than we could cope with. Now we need to fight for our share of an increasingly competitive global market for financial services.
This week we published our strategic priorities, in what remains a delicate economic environment. We are facing significant economic, social and environmental changes, and while we are seeing improvements in our economy, our income is rising at a slower rate than in the past.
We have highlighted four priorities we want to focus on to ensure Jersey adapts to this fast-changing world; health, education, economic growth and St Helier. They are the issues that will form the basis for our Strategic Plan, which is due to be published in March.
Economic growth
This morning my comments will focus on economic growth in finacial services.
To deliver economic growth, we must understand what opportunities are available in the stable and well respected finance centre we have created.
Relying on our previous successes is not enough. We must stimulate forward looking growth through sensible innovation, investment and enterprise. We will put a greater emphasis on innovation and technology. I see the digital industries and FinTech as core in this new world.
As Chief Minister, there are five core principles I wish to instil in order to protect and enhance our position.
Principles
The first is stability:
- we have a government and a regulator committed to the industry with an aim to sustain and further invest in long-term growth
- we have a tax neutral platform with appropriate tax agreements with other jurisdictions
- our legal system is a robust, modern and sophisticated framework
- our judiciary is independent and experienced with strong legal precedents in complex international matters
- our island’s fiscal management is prudent and the island is underpinned with good air-links, communications and modern office provision
The second is responsibility:
- we must be good neighbours and comply with international standards and global initiatives
- Jersey is considered a good partner to the UK and EU and as such we must create a proportionate and appropriate regulatory framework in which to do business, whilst at the same time remaining competitive
- we are committed to international standards that are widely adopted
- we continue to participate in discussions and assessments with a number of international standards bodies
The next is excellence.
Thanks to years of hard work, Jersey has established many world class financial services institutions, each employing highly skilled and experienced individuals.
We will work hard to maintain this excellence and, as highlighted in the Council of Ministers' strategic priorities, we will grow our local skill base to carry forward these high standards.
Local expertise also extends to our pool of talented non-executive directors whose advice allows firms to diversify capabilities and continue to deliver market leading products.
The fourth core principle is innovation.
To ensure long term prosperity, Jersey must explore more ambitious opportunities in less familiar business territories. This can only be achieved by repositioning, building new capabilities and acting quickly when opportunities arise.
The JFSC’s recent commitment to extend the bank licensing rules to allow applications from banks in the global top 1000, rather than just top 500, is a clear enabler in this area.
Finally, sometimes the most effective solutions are the simplest. The fifth core principle is working together.
The government, industry and regulator must coordinate developments for the benefit of all, without, of course, impacting on the independence of the regulator.
We already have a well-established steering group to recommend what decisions are required to maintain progress and to ensure Jersey remains a top-rated international finance centre.
I am committed to working as closely as possible with Jersey Finance in the delivery of this vital work. Assistant Chief Minister, Senator Ozouf, is now responsible in government for all financial services. He is the ministerial lead who will ensure this work is coordinated.
Digital
The future of our economic evolution lies in our ability to adapt, innovate and introduce new technology, as well as using our traditional strengths as an IFC to provide ‘incubator’ space for digital business.
I want to realise Jersey’s potential in the 'digital ecosystem' and to promote activities that improve the environment for digital business in Jersey. One of the most natural digital environments for Jersey to focus on is the merger of Financial Services with Technology, known as FinTech.
The UK FinTech market is currently worth £20 billion in annual revenue, according to EY. Figures from London & Partners, the Mayor of London’s promotional body, show that more than half of all European FinTech venture capital investments made in 2014 went to London firms, a total of £342.6m. That's triple the amount raised in 2013.
Jersey must demonstrate its value to this new emerging sector.
I am therefore pleased to support the work being carried out by the island’s publically funded promotional body Digital Jersey, which acts as an accelerator for the digital economy and for a digitally enabled society.
Planning for the future
When we study the horizon we can see clearly what Jersey needs:
- a clear economic strategy to which all are fully committed
- a commitment to business growth and compliance with international standards, to protect the Island’s international reputation
- a partnership between government, the regulator and the industry, with shared objectives
- a quality product
- a willingness to welcome enough skilled staff to maintain a competitive industry
- an ability to make prompt decisions; whether to enact legislation or provide essential infrastructure
Senator Ozouf and I are both committed to ensuring we maintain our well-earned reputation as an IFC of genuine substance. Increasingly business success will come from the quality of the services provided, and the speed of response to market needs, based on a foundation of common standards.
Jersey is well placed on all counts, and has a great future ahead of it.
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