Jersey economy: Anxious times.

Jersey is another overseas British Territory that has made Offshore Banking and finance the engine for its growth and development.

While earlier it was agriculture, fishing and knitwork that sustained its economy, today, it is high finance that contributes nearly 50% of the territory’s GDP, apart from 60% of the Government’s tax accruals. Liberal laws relating to establishment of firms and low tax rates have attracted a host of Banks and financial services companies to establish their offices here. British nationals subject to high taxes at home have found it convenient to base themselves in Jersey to escape the tax rigors at home. Nearly 35000 firms, including Banks and financial services companies are said to be registered in Jersey. The proximity to U.K. and the E.U. markets, as also free access to them have played an important part in boosting the economic prospects of Jersey.

Agriculture continues to be an important economic activity, with vegetables and flowers attracting major buyers in the U.K. And of course, the world famous Jersey cow that has been cross-bred with local varieties in various parts of the world is a native of Jersey. Special mention may also be made of the Jersey Royal Potatoes and dairy products that are exported from Jersey, mainly to the U.K and the E.U. Tourism is another area that continues to grow, and contribute to the economy in increasing measure. The majority of the tourists are from Britain.

The Jersey administration is also encouraging light industry and has succeeded in developing a small but thriving electronics industry. However, Jersey has to import raw materials, foodstuffs, machinery and equipment, chemicals, etc.

Presently, there is a sense of anxiety among the denizens of the Island about their future, especially in terms of the current global economic doom.

Isle of Man economy: Super performer.

Isle of Man is a British Overseas Dependency whose economy is doing much better than its Principal’s! Only the global economic slowdown seems to have slowed down the Isle of Man that otherwise is said to have achieved and maintained impressive growth of 10%+ for over 25 years. A superlative performance, by any standard.

Once dependent on agriculture and fishing, the Isle of Man has diversified its economy that has ensured a steady growth for the Island over a long period of time. The major economic activities that drive the Isle of Man economy include:
Banking and Financial Services: Offshore Banking is said to contribute nearly 20% of the Island’s GDP, with other financial services contributing about 20%. That means 40% of the GDP is generated from this sector.
Services: Among the services that contribute the chunk of the revenues to the Island are ship registration and management. The Isle of Man offers highly professional services in the areas of maritime laws, insurance, finance and management. Film production is another area that the Island has been quite successful at by providing professional services. Surprisingly, the Island enjoys an important position in the area of space exploration and commerce, and hosts the Institute of Space Commerce. Tourism is also on the rise as an industry with great potential.
Manufacturing: The Isle of Man is an important center for the manufacture of sophisticated components used in airliners, spacecraft, submarines, oil rigs, etc. No doubt the Island has enjoyed AAA ratings from rating agencies for long.

The Isle of Man administration has for long adopted a liberal economic environment, making it investor-friendly, with liberal labor laws that allow employment of people from abroad. That apart, it has been the policy of the Island to end every budget with a surplus. The only problem that it faces now is opposition in the U.K. to various benefits extended to it in the form of subsidies, especially as Britain faces economic problems in the wake of the global economic meltdown.