Adapt or face a downturn, finance sector warned

Keith Corbin, executive chairman of the Nerine Group of fiduciaries, pictured, which has offices in Guernsey, British Virgin Islands, Hong Kong, India and Geneva, said the industry would have to look towards Asia and other emerging markets for future business as the global economic power base shifted rapidly in that direction.

And while it was obvious that service from Guernsey would come at a cost, that cost would need to be controlled as far as possible, he warned.

'In the Channel Islands, where a balance has to be struck between remaining internationally competitive and maintaining appropriate levels of regulatory standards, practitioners operate in a high-cost environment,' said Mr Corbin, a former chairman of the Guernsey International Business Association.

'While the islands are premier international financial centres, they are still relatively unknown in Asia and other emerging markets.

'We need to articulate the long-term benefits of high-quality service provision, which comes at a commensurate cost, and for Guernsey and Jersey to understand that there are other jurisdictions that compete with us in those markets.

'The worst-case scenario is that failure to adapt will lead to a severe contraction of wealth management business in Guernsey and Jersey.

'This could have a catastrophic effect on the islands' economies. There will always be niche businesses here, but the islands can't defy global trends.

'A balance must be struck between maintaining international regulatory standards and remaining open for new business. We must contain the impact of operating costs on business so we don't price ourselves out of the market.'