The OECD, prompted largely by worries over tax competition and the emerging difficulties for high tax states from the increasing mobility of economic activities through the use of the Internet, is setting a dangerous precedent by usurping roles appropriate to more widely representative international organisations. Furthermore, the European Union and OECD have themselves adopted plans for greater access to bank information, but progress in implementation is likely to be slow because of the continuing unhappiness of such countries as Austria, Luxembourg and Switzerland. Thus the demands the OECD is making on the OFCs are in excess of what it is able to achieve internally. This is clearly discriminatory. OFCs offer a useful means of extending the very limited range of opportunities available to very small states to promote diversified, durable and skill-intensive development.
Tax competition is one of the few areas in which small size confers an economic advantage.
Removing the legitimate attractions of OFCs could greatly set back economic development in small states. Back To The Top CNIS Commonwealth News and Information Service Tel. This news service is delivered by the Information and Public Affairs Division of the Commonwealth Secretariat, London, and may not necessarily reflect the views of the Commonwealth Secretariat. If you print, copy, archive or re-post these items, please retain this credit and disclaimer. Re-posting on commercial sites requires written permission from the Commonwealth Secretariat.