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Developments buck BREXIT uncertainty to boost economy
European Economic Area, and if we were not able to renegotiate EFTA, then we would have to carefully reconsider what the economic prospects for Gibraltar are and how we would be positioned.
“We would still have a port and an airport, and we would still have privileged geographical access to a pivotal maritime point which is the Strait of Gibraltar. Survive, we would, but how our economic model would change is something that the government is working on.”
Albert Isola, financial services minister, referred to Brexit as “the elephant in the room” and he insisted that “business always needs to present all options for their clients and all we ask is that they put Gibraltar on the list to consider”. Businesses - from the UK, US and Asia - were still showing interest in Gibraltar because it “is a more liberal jurisdiction than others, more innovative and capable of looking at things in a slightly different way.”
First with register
Gibraltar was “growing as one of the most reputable financial services jurisdictions in the world”, Picardo maintained. It was likely to be the first EU jurisdiction to implement the Fourth Anti Money Laundering Directive and establish by year- end a ‘Central Register of Beneficial Ownership’. “We are able to do so quickly, because we already have the names and addresses of all owners of companies in Gibraltar”, Picardo explained.
Being at the forefront of compliance with international standards of transparency has meant Gibraltar signing as an early adopter of the Common Reporting Standard known as Global FATCA, putting the financial services sector in the same group as the City of London and Frankfurt, for example. The first tax information exchange under the US FATCA occurred in September, to be followed next year by the UK FACTA agreement going live.
Gibraltar now has Exchange of Information relationships with 79 other nations and as Isola, pointed out, the European Commission has confirmed it has no concern that the jurisdiction’s tax is harmful. Two further EU jurisdictions had removed Gibraltar from tax ‘black’ lists, leaving just seven to be convinced (including Spain), despite the fact that they all have TIEAs with Gibraltar as part of an EU-wide agreement.
Ray Spencer
Multi-million pound development projects are destined to add significantly to Gibraltar’s economy in 2016, Chief Minister Fabian Picardo has revealed
some extended negotiations, in particular over infrastructure and phasing - the conclusion is imminent.”
Work is under way at Midtown, a £120m residential, office and car parking central development, and at the £45m Gibraltar World Trade Centre, that will be complete next summer. (see Profile, P12)
Planning approval has already been given for new private residential projects at Kings Wharf (£40m) and Ocean Spa Plaza (part of £80m worth of general development), both projects contributing new premium payments and strengthening the £1.65bn gross domestic product that is destined to grow by circa 10% for the fourth successive year.
Wine tunnels
In September, a £6m project was unveiled to create a wine storage facility with up to £60m worth of wines laid down from 2017 for international investors. Work starts before year-end for Gibraltar Wine Vaults (GWV) in tunnels created before World War II by Royal Engineers within the Rock, and represents a new economic activity for the jurisdiction.
Around 80% of the 33 linear miles of tunnels have been handed to the government by the Ministry of Defence and used for tourism, distribution of services, water storage & other secure storage as well as for car parking, fuel storage & distribution (in the past). A three-storey ‘interpretation centre’ will provide wine tours and tastings and help provide up to 30 jobs initially.
Together, the developments represented “a huge vote of confidence in the strength of the Gibraltar economy”, Picardo told some 400 lunch guests and was a positive sign even given uncertainties over Britain’s continued membership of the EU (BREXIT).
Speaking as the ‘In Europe Campaign’ was launched, he assured City businesses: “I am sure that together we will face off challenges in the future”. Days earlier a Guardian newspaper report quoted his assur- ance: “The Gibraltar economy is resilient.”
But Picardo added: “As part of the European Union, at present we have access to the single market, and if we were no longer to have that access, if the United Kingdom were to leave the European Union and the
Chief Minister Fabian Picardo addresses the audience at the Finance Centre lunch
Speaking at London Gibraltar Day events in mid-October, he told Gibraltar International that agreement had been reached for payment of “tens of millions of pounds in premium payment” for a 16,000m2 mixed-use development at Rooke, a prime central site.
London and Regional Properties, a London-based company with a worldwide £9bn+ investment portfolio, is preferred bidder to provide “a once in a generation opportunity“ for a new school, facilities for emergency services, commercial, residential and offices.
Development value, he revealed, would “certainly be in the hundreds of millions”. That project follows a £1.1bn east side Blue Water reclamation development by Camoren Group, providing the government with £87m in premium payments for the 700,000m2 marina, luxury private and affordable homes, shops and offices to be started before year-end.
The Camoren money alone virtually equals the total received in premiums by the government in 2014-15! Picardo had hoped to announce payment at the Finance Centre lunch in the City of London’s Guildhall, but as the chief minister explained: “It’s my job to play hardball in respect of negotiations for the development of Gibraltar land; we have had
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Gibraltar International
www.gibraltarinternational.com