Tax Havens Crackdown Just An Excuse

The efforts of major and industrialised economies to crack down on so-called tax havens have been described as an excuse to spread the blame for the global financial crisis on countries not responsible for it.

That assessment form St Vincent and the Grenadines Ambassador to the United Nations, Camillo Gonsalves as he addressed the UN General Assembly yesterday.

Gonsalves said his country faces “being stigmatized out of our transition into financial services” by the G20 economies, the Organization for Economic Cooperation and Development (OECD) and “other non-inclusive bodies”.He said the crackdown on tax havens was actually “a pathetic effort to cast a wide and indiscriminate net of blame across a swath of legitimate and well-regulated countries’ development efforts”.

“We note the irony of these paternalistic prescriptions from the same countries that are unable to stem corruption and mismanagement within their own borders, where corporations recklessly squander trillions of dollars and a single buccaneer investor can make US$50 billion disappear into thin air – an amount greater than the combined annual budget expenditures of the entire CARICOM [Caribbean Community] sub-region,” Gonsalves said.

The Ambassador also took aim at the G20 for describing itself last week, at a summit in the United States city of Pittsburgh, as the premier forum for international economic cooperation.

“St Vincent and the Grenadines is not a member of the G20, nor were we consulted on its ascension to the ranks of arbiters of our economic fate…The G20 faces a serious legitimacy problem: aside from being non-inclusive and unofficial, many of the countries at that table represent the champions of the financial and economic orthodoxies that led the world down the rabbit-hole to its current economic malaise,” he said.

Ambassador Gonsalves also cast doubt on recent reports from some observers that the economy is returning to normal.

“The invisible hand of the market is still clasped firmly around the throats of poor people and the developing countries of the world. We see none of the so-called `green shoots` that populate the fantasies of discredited economic cheerleaders,” he said.

“Indeed, the seeds sown by this crisis may produce the strange and bitter fruit of increased poverty, suffering and social and political upheaval. The crisis itself, with its disproportionate impact on the poor, will only widen and deepen the yawning gap between developed and developing countries.”

Gonsalves, son of Vincentian Prime Minister Dr Ralph Gonsalves, has represented his country at the UN since 2007.

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