Jersey’s Minister for External Relations, Senator Ian Gorst, celebrates the island’s long-standing relationship with the UAE during his visit to Dubai and Abu Dhabi this week
Jersey marks growing ties with UAE
There may be thousands of miles between the UAE and the island of Jersey but over the past two decades, the two jurisdictions have developed a well-established relationship based on our shared commercial interests and strong governmental ties.
Like the UAE, Jersey has long been a centre of international trade. As a small island with finite resources, Jersey has always looked to the rest of the world for trade. Three hundred years ago, our fishermen were pioneers in the North Atlantic cod fishing industry. Our famous Jersey cows have been exported around the globe for decades, helping the island to make its mark on the world stage.
While the nature of Jersey’s flagship industry has changed to finance, the island’s international reputation for quality products and services has remained just as strong. Jersey is proud to be a leading international finance centre that is highly regarded in the UAE thanks to its first-class regulatory and legal framework, expert workforce and economic stability. Its business-to-business links with the UAE go back many years but there has been significant growth in recent years. We now enjoy a thriving flow of business between our two jurisdictions, principally through private wealth management and fund services. This led to the opening of Jersey branches by several UAE banks offering commercial banking products to expatriate customers. We welcome this business and we are delighted that they still call Jersey home.
The island opened the Abu Dhabi office of Jersey Finance to promote our financial services sector in 2011 – starting with a "fly-in" one man, then growing to a team of two in the Emirates Towers, and now with a fully-fledged regional operation with a new offices opening in Dubai’s impressive DIFC this week. That underlines Jersey’s commitment to the UAE, and marks the next stage in the evolution of our bilateral relationship.
Our political relationship is also on a firm footing: Jersey and the UAE signed a Double Taxation Agreement in 2016, which came into force in February 2017. Jersey and the UAE are both committed to the OECD standards on transparency and exchange of information, and both jurisdictions sit together as members of the OECD’s Inclusive Framework on Base Erosion and Profit Shifting (BEPS). The Jersey Financial Services Commission – which regulates the island’s financial services industry – has negotiated Memoranda of Understanding with the Central Bank of the UAE, the Dubai Financial Services Authority, the Emirates Securities and Commodities Authority and the Abu Dhabi Global Market.
This week we held ministerial-level discussions with the UAE on Jersey’s first Bilateral Investment Treaty (BIT). Given the strength of our existing connections, it is only fitting that the UAE will be the first international partner with whom Jersey opens BIT negotiations. BITs encourage greater flows of cross-border trade and foreign direct investment, thereby strengthening the role played by the UAE and Jersey in providing well-regulated capital to meet the needs of high-growth emerging market economies.
Closer to home, Jersey’s long-term relationship with the City of London makes the island a key conduit for international wealth. Our finance industry has been able to deliver the ideal conditions for international businesses bolstered by its unique constitutional position: Jersey has its own democratically elected parliament, which has consistently maintained responsibility for domestic affairs, including fiscal matters. Jersey is an attractive location for the pooling of multinational funds, with an internationally respected legal system that can be trusted to handle cross-border disputes fairly – and its tax neutrality status eliminates investors’ concerns about being double taxed or subject to withholding charges.
Jersey’s experience as a well-regulated, transparent and cooperative jurisdiction can help support the growth of the financial services sector in countries around the world, helping to bolster trade and investment. For example, an independent study in 2014 estimated that Jersey is a channel for up to 1.5 per cent of global foreign investment into Africa.
Although financial services accounted for 41 per cent of the island's economy in 2016, agriculture and tourism are also key sectors. One of the jewels in Jersey’s crown is Durrell – a world-renowned conservation trust that has a long association with Al Ain Zoo for the protection and conservation of wildlife, and has trained zookeepers on taxonomy and animal husbandry. Durrell also works with the Mohamed bin Zayed Species Conservation Fund on several initiatives.
There is much Jersey can learn from the UAE. The visit this week provides opportunities to look to the future and discuss the UAE’s experience in diversifying its economy. Few jurisdictions have higher ambitions for economic transformation and the creation of high-quality jobs in financial services, aviation, trade and technology. The UAE also plays host to a number of international technology companies testing future solutions and is a global hub for business and the future economy. We hope to identify new opportunities for Jersey and the UAE to work alongside one another to achieve long-term economic success across a broad range of sectors.
From the export of the world-famous Jersey Royal potato to the development of a thriving and internationally recognised financial services sector, Jersey remains a premier place in which to do business. Robust legal and regulatory institutions, tax neutrality, a stable political cycle, good quality infrastructure including digital technology and the presence of a highly skilled workforce are all key ingredients to Jersey’s success in attracting business from around the world.
As we celebrate our valued relationships with the UAE, we know that we are building firm foundations that will ensure a legacy of sustainable economic growth for future generations.
Senator Ian Gorst is Jersey’s Minister for External Relations