What’s in store for the business world in 2015?

Business editor Duncan Foulkes quizzes three prominent Isle of Man businessmen on their thoughts

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Chris Eaton, Chief Executive Officer, The ILS Group

There is no one major issue or initiative that faces the CSP and TSP sectors in 2015. Rather, they face more of a continued barrage of supra national regulatory and information exchange issues that will start to play themselves out with the first reporting for parts of the US and UK FATCA during the year. This is coupled with the continued and remorseless move towards the Common Reporting Standard (CRS), which will apply FATCA type principles to individuals and entities from a far wider range of jurisdictions than FATCA will apply to.

Whilst the information exchange arena can be described as a pretty much level playing field between Isle of Man operators and our competitors in the other major finance centres, the sheer resource required to introduce compliant systems and the training that must go along with this tends to favour the larger organisations over the smaller ones simply because of economies of scale. This driver towards the larger CSP/TSP has been evident for the last couple of years within the local sector and will probably bring about the greatest change in the coming year.

Thankfully, the economic backdrop, particularly in the UK, is more encouraging than it has been for some time, but with the possibility of continued blips affecting this fragile confidence (think Greek elections, Ukraine, ISIS etc), nothing can be predicted with too much certainty.

So, another year of cautious optimism for the larger CSP/TSP players with geographically and sectorally diversified client bases, but one that could be of much greater concern to some smaller niche players if world affairs and economic concerns fall in the wrong place.

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Andrew Gerrard, director, Harding Lewis Limited, Chartered Accountants

We are certainly experiencing very strange times with many exciting things afoot but these are counterbalanced by some seriously difficult issues.

Reasons to be cheery

History books will undoubtedly record that the year 2015 is part of a long period of technological revolution. We have already seen increasing human interaction using technology e.g. skype, social media, and this will continue at a pace.

In our own world of accountancy we shall shortly as a firm have the technology at hand to interact with customers using digital signatures and client portals.

This should not ever mean removing face to face contact, however, as this will remain very important.

Indeed, business should serve what the customer wants which will mean embracing technology but not forgetting traditional methods of interaction.

Digital currency development is also very interesting but with challenges to overcome and we hope that this new sector alongside Biomed will form part of a rosy future for the island.

Finally, the recent fall in oil prices (and resultant impact on inflation) is I believe largely to be welcomed and this will give consumers a much needed boost to real incomes. I hope there is a new era in lower energy prices.

Challenges

Managing the decline in the older sectors such as banking and other financial services will result in individuals retraining in other sectors.

Government finances in the Isle of Man and many other jurisdictions are still a long way from being re-balanced.

The taxpayer will have bear the brunt of future changes by way of increased means testing and more self-sufficiency. The economy of the future, probably beyond 2015 will not involve any (or very few) hand outs unless the recipient is in need and vulnerable. In the short term this will mean higher rates and fewer services for free or subsidised e.g. dentistry.

In the longer term I believe state pensions and other benefits e.g. non critical health service will probably only be provided free to those without the means.

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Warwick Bartlett, CEO, GBGC (Global Betting and gaming consultants)

GBGC has had a good year. We have completed a number of big projects for clients that are now expressing confidence to invest in gambling following the improvements to the US and UK economy.

The gambler can only spend what he has in his pocket and looking out at the world from the IOM there does remain a number of issues that can change the outlook quickly.

We see the problems in the Ukraine causing the Russian economy to reach new lows and US dollar denominated debt in emerging markets that can cause those countries to default. It brings into question the viability of some of the larger resort casino developments in Crimea and Vladivostok.

We see Africa as the one continent that has most growth potential for eGaming. Sports betting is taking off in Nigeria, Kenya, Tanzania and Uganda. GBGC predicted this two years ago at the KPMG eGaming Summit and the delegates thought we were mad, good to see it coming right!

The fall in the oil price is the equivalent of giving everyone a tax rebate so we see, at least for the next nine months, healthy revenue streams for the gambling industry.

However, no politician has ever lost a vote by increasing taxation on gambling so we need to watch events closely and adapt policy according to changing circumstances. I am optimistic, but keeping my powder dry!