Reports Highlight Jersey's Contribution To EU And UK
by Jason Gorringe, Lowtax.net, London
20 October, 2016
Jersey makes a significant contribution to the economies of the EU and the UK, according to a new report from the island's financial services promotional agency, Jersey Finance.
The Jersey Finance-commissioned research, "Jersey's Value to Europe", was published by Capital Economics. The report shows that Jersey's finance industry facilitates almost EUR190bn (USD209bn) of foreign investment into the EU (excluding the United Kingdom (UK), supporting around 88,000 jobs across EU member states.
Meanwhile, a separate report from Capital Economics – "Jersey's Value to Britain," launched at the same time – builds on previous research undertaken in 2013 to outline the current value of Jersey to the UK. The two reports are aimed at providing a comprehensive and up-to-date assessment of the impact of Jersey's finance industry to the UK and the rest of the EU.
The reports note that around one third of all fund assets administered and managed in Jersey are located in EU countries other than the UK, and Jersey is estimated to be a conduit for almost GBP500bn (USD615bn) of foreign investment into the UK, equivalent to five percent of the total stock of foreign-owned assets in the country.
The reports also show that Jersey supports an estimated 250,000 British jobs, of which 190,000 are from foreign investment alone, and adds GBP14bn (USD17bn) to the UK economy. Jersey banks upstream GBP89bn (USD109bn) of deposits to UK banks, providing 1.5 percent of the funding of the whole UK banking sector.
The research emphasizes that while the UK and the EU are core markets for Jersey, a focus on global markets is vital for Jersey's future success. It found that, globally, cross-border lending and borrowing by banks has risen from just over USD1 trillion in 1980 to USD25 trillion in 2015. Against that backdrop, Jersey is now custodian of EUR1.7 trillion (USD1.87 trillion) of wealth in its banks, trust companies, corporate structures, and fund vehicles, with around two-fifths (37 percent) originating from investors outside of Europe.
Geoff Cook, CEO of Jersey Finance, said: "These latest figures demonstrate that Jersey shares an important and positive partnership with both the UK and the rest of the EU, supporting jobs, facilitating overseas investment, and encouraging growth. At the same time, the research also shows that cross-border financial flows are a global phenomenon and Jersey's strategy of engaging increasingly with markets beyond Europe, including Asia and Africa, will become more and more important."
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