| The formation and development of the Euromarkets and Offshore Financial Centers (OFC's) in the second half of the 20th century were stimulated by restrictive monetary measures introduced by the developed countries to alleviate their chronic balance-of-payments problems, tax increases, economic instability in South America and the Middle East, and the fear of political intervention of war.; Offshore Financial Business is mainly conducted for the benefit of non-residents and usually carried out independent of the domestic economy. OFC's succeed in accommodating the offshore financial business by maintaining political stability, instituting flexible banking regulations, relaxing foreign exchange regulations and by providing bank secrecy in a low-tax or non-tax environment, with the goal of generating employment, income, fees, taxes and indirect benefits.; In addition to providing an adequate infrastructure in a low tax environment at an advantageous geographical location, Curacao has favorable tax agreements with the United Kingdom, Denmark, Norway, the Netherlands and, up to January 1988, with the United States.; The survey carried out for this thesis mainly dealt with the offshore banking sector of the offshore financial industry. Information was gathered on the five major issues: (A) Entry requirements of the Central Bank and the role of other governmental agencies. (B) Alternatives to the present tax-regime and other fiscal issues. (C) Attractiveness of Curacao as an Offshore Banking Center. (D) Contribution of offshore banks to the economy. (E) Insights into the function, organization and activities of offshore banks, the perceived future of offshore banking activities on the island, and the acquisition of offshore banks.; Although the U.S. treaty was one of the main impetus for the development of offshore services in Curacao, the survey conducted showed that when appropriate measures and policies are implemented, the offshore banking sector can be stimulated, enhanced and further developed, despite any fiscal measures taken by the United States or, for that matter, independently of any treaty.; OFC's like Curacao will succeed in surviving the pressures exercised by onshore money market centers' government-, tax- and bank supervisory-authorities if they remain flexible, keep abreast of external developments, have their house in order, and supervise their offshore business appropriately. |
