Hot on the heels of analysis which shows the island’s economy is stagnant, the Guernsey International Business Association has outlined what it sees as opportunities and hope.
The Institute of Directors Guernsey recently discussed trends which show living standards have barely changed in 15 years, while Jersey’s economy is now 15% bigger.
Guernsey’s GDP fell in 2023, and is expected to be flat or showing another slight decline last year, while Jersey’s grew in 2023 driven by finance and particularly banking.
GIBA President Paul Sykes was part of a panel discussion at the Guernsey Finance Industry Update on Wednesday.
“I think the IoD made people sit up and caused perhaps a bit of anxiety,” he said.
“Perhaps there’s a recognition of change there, and in that there’s an opportunity.”
Digging into IoD data gathered as part of an industry survey, he accepted that it showed business leaders had a negative outlook on Guernsey’s economic future, yet said they were confident in their own firms.
“That doesn’t quite square up,” he said.
The IMF is predicting 1.6% growth for the UK, leading Europe.
“When the UK does well, Guernsey tends to do well,” added Mr Sykes. “So there’s reason for optimism there too.”
He also highlighted the activity at the Guernsey Financial Services Commission last year, with 600 applications, 50 new insurance entities, 50 new funds, 43 new investment licences.
“Had we been able to solve the housing crisis, we’d have had 600 vacancies filled, between £6m and £12m of tax take,” he said, directing the comment at politicians present.
Mr Sykes was pleased that Economic Development had prioritised the finance sector development framework.
“It’s important because we need to galvanise around a strategy, as industry, as government, as a regulator. It’s going to take time, so it’s no panacea.”
He spoke about what had been achieved with sustainable finance as well as the Red Cross and European Bank for Reconstruction and Development both using innovative Guernsey insurance structures to help with disaster relief and rebuilding.
Other international agencies could follow.
“So there’s huge things going on with strategies.”
He urged the finance industry to get their leaders “out of the village,” saying Guernsey Finance will open the door for them, but they had to go through it.
“I’m not saying there’s a silver bullet. There’s no panacea. But what can we learn? Well, Guernsey is better when Guernsey is together. Look what we did with Moneyval when we aligned, look what we did with the Island Games. If we look at what GB achieved in the 2012 Olympics, it was through incremental gains. The aggregation of incremental gains brings about elite performance and in there lies opportunity.”
A guide to GIBA
GIBA is made up of the chairs of seven industry associations covering finance, alongside the chair and deputy chair and a secretary/technical resource.
It meets monthly, with Guernsey Finance also in the room.
They are also in monthly meetings involving government and the regulator.
GIBA Deputy Chair Joanne Peacegood said the organisation started 2024 relooking at its strategy.
“We put together quite a detailed strategy, but achievable. And the strategy includes, but not limited to, housing, education, fiscal, regulatory and innovation, things that we’re talking about all the time.
“For each of those work streams, we develop sub committees, and then we’ve had actions that have come on throughout the year.
“Specific initiatives that GIBA have worked on outside of that, or as part of, will be Moneyval, and many of us will know the effort that went into Moneyval, from an industry perspective, from a GFSC perspective, from a government perspective, and GIBA tried to help to bring all that together and make sure we were as well prepared as we can be.
“And also during the year we’ve come together with what we have named the G8, the other business associations in Guernsey, including Chamber, the IoD, retail and construction to name a few, to understand common areas of interest, and how we work together to enact change.”
Jersey Finance received £6.5m. from its government, 83% of its total budget, compared to the £2.5m. Guernsey Finance gets from the States, with another £1m. contribution from local industry.
“Naturally, they’re going to be doing a lot more,” said Mrs Peacegood.
“And by the way, Guernsey Finance does a lot with what they get … our digital reach is five times that of Jersey. So we are trying to do what we can with the limited resources we have. But I do have a plea… for our government to continue to see the value of the financial services sector, to continue to engage with us and continue to support the financial side of Guernsey Finance, so that we can really capitalize on that and get out there.”