Introduction

It is worth noting that, ‘of the ten richest countries in the world in terms of GDP per head, only two have more than 5 million people: the United States with 260 million and Switzerland, with 7 million. A further two have populations over 1 million: Norway with 4 million and Singapore, with 3 million. The remaining half dozen have fewer than 1 million people.’ The point is that jurisdictions do not need to be large to be successful – but that does not mean that it is easier for small jurisdictions to be successful. Nevertheless, size may be a significant variable. Many of the jurisdictions which are regarded as ‘Offshore Finance Centres’ are small islands – and this chapter explores some of the implications.

Economic expedience

It has been said that ‘[s]mall jurisdictions must not lose heart at the global project taking place around them – it does not necessarily spell their doom and decline and may indeed provide them with new, niche opportunities’.

Small islands have at least one thing in common with other jurisdictions – which is that all must pay their way. Some island centres have found that the establishment of an ‘Offshore’ finance industry is one way to achieve this. ‘Most OFCs are located in small island economies and offshore finance is often seen as a useful economic development strategy for such places’.