What’s So Special About Barbados Anyway?

Barbados has always been a trade and commercial hub within the eastern Caribbean ever since the first English ship arrived here in May of 1625, captained by John Powell (the first actual settlement occurred sometime later in February 1627, near what is now Holetown). After a brief tumultuous period during the years immediately after settlement, […]

By Neal Griffith

May 7, 2015

Barbados has always been a trade and commercial hub within the eastern Caribbean ever since the first English ship arrived here in May of 1625, captained by John Powell (the first actual settlement occurred sometime later in February 1627, near what is now Holetown). After a brief tumultuous period during the years immediately after settlement, Barbados with its easily navigated terrain (compared to other nearby islands), inviting and accessible beaches, its developing modern and forward thinking culture, and, its well-managed system of Government started to attract wealthy aristocrats and businessmen, some of whom chose to make the island their home, and a place where they could conduct business. Barbados was a new frontier and a perfectly located gateway to the Americas, from the UK’s perspective.  By 1660, Barbados generated more trade than the other English colonies combined, only being surpassed in the early 1700s by larger islands like Jamaica. Bridgetown, the capital, was one of the three largest cities in the English Americas (the other two were Boston, Massachusetts, and Port Royal, Jamaica.

There was always a large volume of trade between the island and large partners like the UK and Canada, which resulted in a country with no obvious natural resources, to hold its own economically, when compared to the larger Caribbean islands like Trinidad and Jamaica, which at the time were rich in natural resources.

Since achieving independence in 1966, Barbados transformed itself from a low-income economy dependent upon sugar production, into an upper middle-income economy based on tourism and the financial services sector.

So what was, and still is, the one major element which made this little island generate such a vibrant economy and so much foreign interest, starting way back in the 17th century? Our people.

We have always been proud of our industrious, trustworthy and reliable citizens, who were not afraid of hard work and were understanding of the value foreign investors meant to our economy. We are happy to learn new skills and new ways of doing business, from those who were willing to teach us. Our political and social leaders were visionaries who helped Barbadians dream big. Many of us are indoctrinated from birth about the virtues of hard work, getting an education and making a difference. This I submit is and remains our single biggest “natural resource”.

Fast forward to the 1990s. Our offshore business sector experienced record breaking year over year growth, due to our highly educated and industrious labour force which was ready and willing to compete with any International Financial Centre. We dreamed even bigger and we were ready to take Barbados to new levels seen in places like Singapore and other major global centres. Again, it was the vision of our leaders and people who proactively and instinctively proved to the world that pride and industry was and continues to be our mantra.

Then came the dark clouds; those seemingly never ending challenges and threats over the past 15 years, starting with the announced change of tax rules in Canada, then on to the international organizations like the OECD and most recently, global reaching legislation like FATCA.   Additionally, the offshore industry was working with legislation which was either antiquated or uncompetitive. The pressure was mounting and many believed back then the industry had, at best, 3 years of life remaining, especially as we witnessed the departure of a few high profile international corporations. However in 2015, we are still here, albeit with a few bruises, but in growth mode.

Generally, we remain somewhat positive about our futures despite the dark clouds. We continue to press on despite those international forces conspiring against financial centres like ours.

Barbados has one of the highest literacy rates¹ in the Caribbean, and one of the highest percentages of locals with tertiary education and professional designations. These benefits help create sustainable development of all businesses which choose to set up here due to increased efficiencies, lower staff turnover and dedicated employees.

Barbados hosts one of the campuses of the University of The West Indies which has always offered free education to Barbadians until recently. Even with the implementation of paid tuition, students’ costs remain competitive, compared to other similarly accredited universities around the world. This campus is a key element to the development of our people and has helped create the highly skilled professional workforce we have today.

Fundamentally, those same characteristics which attracted the early day investors to Barbados continue to attract investors today. Despite the global forces, Barbados has an affordable, highly professional workforce which can create immense value to any business, irrespective of whether tax minimization is one of the motivating factors for setting up a business here.

Paul Arden (Saatchi & Saatchi) once said “Your vision of where or who you want to be is your greatest asset”. Barbadians embody that vision.


Reference:

 1 According to the CIA World Factbook and national data, approximately 99.7% of Barbadians over age 15, have attended school and can read and write.

Neal Griffith

Neal Griffith is Vice President of The Blue Financial Group, a boutique trust and corporate services firm providing family office and third party fiduciary, corporate and fund administration services in Barbados. Neal has over 20 years’ experience in the financial services industry having led trust and private banking departments within two large Canadian banks’ operations in Barbados and The Bahamas.