In the absence of compensatory mechanisms, the complete elimination of these offshore centers could have a heavy toll on income and activity in the domestic economy. I noted earlier that the reforms being proposed by the standard-setters were largely targeted to the advanced countries.
While the Caribbean did not suffer serious direct effects from the international financial crisis, the subsequent collapse of the CL Financial conglomerate and the recent failure of a few banks in the OECS should be a stark reminder of the weakness of our regional regulatory systems. Several of our countries have been taking steps, on an individual basis, to upgrade their regulatory structures.