Economy of Gibraltar
Template:Short description Template:Use dmy dates Template:Use British English Template:Infobox economy
The economy of Gibraltar consists largely of the services sector. While part of the European Union until Brexit, the British overseas territory of Gibraltar has a separate legal jurisdiction from the United Kingdom and a different tax system.<ref>Gibraltar Taxation home page Template:Webarchive</ref> The role of the UK Ministry of Defence, which at one time was Gibraltar's main source of income, has declined, with today's economy mainly based on shipping, tourism, financial services, and the Internet (mostly gambling).
As of 2020, Brexit represents a major uncertainty for the Gibraltar economy.
Shipping
[edit]- Bunkering
Gibraltar is one of the largest bunkering ports in the Mediterranean Sea, with 4.3 million tonnes of bunkers delivered in 2021 to over 5,500 ships. This has become the main activity within the Port of Gibraltar. Increased competition from Algeciras in 2022 resulted in a fall to around 3.4m tonnes.<ref>Template:Cite web</ref>
Finance
[edit]Until Brexit Gibraltar was a constituent part of the European Union as a Special Member State territory, having joined the European Economic Community with the United Kingdom in 1973, under the provisions of the Treaty of Rome relating to European dependent territories. However, it is exempt from the Common external tariff, the Common Agricultural Policy and the requirement to levy Value added tax.<ref>Gibraltar's EU status Template:Webarchive</ref>
Financial institutions operating in Gibraltar are regulated by the Gibraltar Financial Services Commission.<ref>Gibraltar Financial Services Commission</ref> Gibraltar has had a stock exchange since 2014, the Gibraltar Stock Exchange.<ref>Template:Cite web</ref>
Subject to notifying the EU Commissioner, who must be satisfied that they meet certain criteria in accordance with the relevant EU Directive, Gibraltar-licensed or -authorised financial institutions can provide services throughout the EU and European Economic Area without having to seek separate licences or authorisation in the host Member State. This is known as the passporting of financial services.<ref>Gibraltar Financial Services Commission - Overview</ref>
In December 2008 in a landmark decision the European Court of Justice ruled that:<ref>Template:Cite web</ref>
This allowed the implementation of a new low tax system which took full effect in 2010.
Referred to as an International Finance Centre,<ref>Gibraltar Financial Services Commission - Building a good reputation</ref> Gibraltar was among 35 jurisdictions identified by the Organisation for Economic Co-operation and Development (OECD) as a tax haven in June 2000.<ref name=OECD>OECD, March 2002 Gibraltar Commits to Co-operate with OECD to Address Harmful Tax Practices Template:Webarchive. Retrieved on July 2006</ref> However, the list's disclaimer states:<ref>OECD issues a disclaimer on outdated report Template:Webarchive</ref>
As a result of having made a commitment in accordance with the OECD's 2001 Progress Report on the OECD's Project on Harmful Tax Practices, Gibraltar is not included in the OECD's list of uncooperative tax havens.<ref name=OECD/> It has also never been listed on the FATF Blacklist of uncooperative countries in the fight against money laundering. It may also be referred to as an offshore financial centre, by international institutions such as the International Monetary Fund (IMF).<ref>IMF, 4 June 2006 Offshore Financial Centers (OFCs): IMF Staff Assessments. Retrieved July 2006.</ref>
However, in its April 2009 progress report, the OECD listed Gibraltar in the list of jurisdictions which, although committed, had not "substantially implemented" yet the internationally agreed tax standard.<ref>Template:Cite web</ref> Following Gibraltar's signing of 12 additional Tax Information Exchange Agreements (TIEAs), as of October 2009, with jurisdictions including the UK, US and Germany,<ref>Template:Cite web</ref> to sum 13, Gibraltar is currently listed in the OECD "white list", and is considered a jurisdiction that has substantially implemented the tax standard. It therefore shares the same status as OECD member states such as the UK, the US, Spain or Germany.<ref>Template:Cite web</ref>
Fiscal advantages, including no tax on capital income, are offered to a maximum of 8,464 offshore qualified companies incorporated in Gibraltar.<ref name=OFF>Gibraltar Tax Exempt Company Registration Changes Template:Webarchive. Retrieved on July 2006</ref> After an agreement with the European Union in 2005, this tax exempt regime is due to disappear on 31 December 2010.<ref name=OFF/>
A 2007 IMF report on the regulatory environment and anti–money laundering has once again endorsed Gibraltar's robust regulatory environment. <ref>Template:Cite web</ref>
According to the report:<ref name="autogenerated1">[1] Template:Webarchive</ref><ref>[2] Template:Webarchive</ref><ref>[3] Template:Webarchive</ref><ref>[4] Template:Webarchive</ref>
In 2008 Gibraltar was listed for the first time in the Global Financial Centres Index published by the City of London Corporation. The Rock was ranked 26th in a list of 69 leading finance centres around the world based on an online survey of 1,236 business professionals, who provided a total of 18,878 assessments.<ref>Global Financial Centres Index</ref> In the most recent GFCI report of 2011, Gibraltar was ranked 63rd in the world, and 8th of the leading offshore financial centres (OFCs).<ref>Template:Cite web</ref>
The Tax Justice Network ranked Gibraltar at #43 out of 71 jurisdictions on its 2011 Financial Secrecy Index. Gibraltar's "secrecy score" was 78, equating to Switzerland in that category.<ref>Template:Cite web</ref>
Gibraltar was also ranked in the top 20 centres for e-readiness, coming 20th after major capitals and leading offshore centres.<ref>Gibraltar Chronicle Story Template:Webarchive</ref>
Tourism
[edit]Present and historical manufacturing in Gibraltar
[edit]Pre-1900 History
[edit]- 1704 - The HM Dockyard in Gibraltar is established after the Capture of Gibraltar. The initial facilities include a quay, careening wharf, and multiple workshops.<ref>Template:Cite book</ref>
- 1720 - South Mole is built during the 1720s. It is a small dockyard with a careening wharf, mast house, and multiple workshops as well.
- 1810 - Marcus Henry Bland arrives in Gibraltar and founds Bland Group as a shipping agency.<ref>Template:Cite web</ref>
- 1840 - Coaling facilities are introduced to Gibraltar.
- 1891 - The Gaggero family take over operations of the Bland Group, as Joseph Gaggero buys the company.<ref>Gaggero, Joe. (2005) Running with the Baton: A Gibraltar Family History. Gibraltar: Joe Gaggero. p. 16. Template:ISBN</ref>
- 1895 - Captain Augustus Phillimore's plan for a new naval dockyard is approved by Parliament.
20th Century History
[edit]- 1902 - An air lock diving-bell plant and barge are imported to install heavy moorings in Gibraltar’s rocky seabed.<ref>"Entrance to a Diving-Bell". Illustrated London News: 1 (Cover). 25 March 1906.</ref><ref>Template:Cite web</ref><ref>Davis, RH (1909). Diving Scientifically and Practically Considered. Being a Diving Manual and Handbook of Submarine Appliances (6th ed.). Tolworth, Surbiton, Surrey: Siebe Gorman & Company Ltd. p. 693.</ref><ref>Template:Cite web</ref>
- 1914 - Two Bland Group ships are attacked by German submarines.
- 1931 - Gibraltar Airways is launched.
- 1969 - The Spanish-Gibraltar border closes, and the Bland Group shifts its focus to tourism.
- 1972 - Gibraltar Industries is founded.<ref>Template:Cite web</ref>
- 1984 - The HM Dockyard is sold to A&P Group, later passed to the Government of Gibraltar as Gibraltar Ship Repair.<ref>Template:Citation</ref>
- 1990 - The HM Dockyard is taken over by Norway’s Kværner, then closed in 1996 for 18 months.
Modern Day (21st Century)
[edit]- 2005 - Gibraltar Corporation is founded. It is a manufacturer of springs, wire forms, and metal stampings.<ref>Template:Cite web</ref>
- 2020 - Bassadone Automotive Group supplyies ambulances and other project vehicles converted locally from SUV vehicles to the United Nations and other agencies, employing some 320 staff across its range of activities.<ref>Template:Cite web</ref>
- 2022 - The HM Dockyard is acquired by UK-based Balaena Ltd, reviving the military ship repair operation.<ref>Template:Cite web</ref>
- 2022 - KeyBanc Capital Markets closes a syndication of a US$400M Senior Secured Revolving Credit Facility for Gibraltar Industries, Inc.
Internet business
[edit]Gibraltar offers a favourable tax system, good internet connectivity along with a well-developed regulatory system. All gambling operations in Gibraltar require licensing under the Gambling Act 2005. The Gibraltar Regulatory Authority is the Gambling Commissioner under the Gambling Act 2005, and therefore the regulatory body.<ref>The Gibraltar Regulator</ref> The UK has published plans to protect online gamblers from crime and exploitation by banning gambling adverts from poorly regulated countries<ref>UK Gambling ad ban plans published</ref> which specifically mention Gibraltar as an approved location.
Defence spending
[edit]Template:Expand section The UK's Ministry of Defence was originally the mainstay of Gibraltar's economy but this has greatly reduced to around 6% of the gross domestic product. In 2006 the Ministry of Defence announced that the provision of services to the military base would be contracted to make further cost savings. This was finalised in January 2007.<ref>MoD to make cost cutsTemplate:Dead link</ref>
Economy in detail
[edit]Gibraltar benefits from an extensive shipping trade, a well regulated international finance center, tourism, and has become a global leader in the virtual gaming industry.<ref>FCO company profile</ref><ref>Gibraltar proves a winning bet</ref>
Self-sufficient Gibraltar benefits from an extensive shipping trade, offshore banking, and its position as an international conference center. The British military presence has been sharply reduced and now contributes about 7% to the local economy, compared with 60% in 1984. The financial sector, tourism (almost 5 million visitors in 1998), shipping services fees, and duties on consumer goods also generate revenue. The financial sector, the shipping sector, and tourism each contribute 25%-30% of GDP. Telecommunications accounts for another 10%. In recent years, Gibraltar has seen major structural change from a public to a private sector economy, but changes in government spending still have a major impact on the level of employment.
Figures from the CIA World Factbook show the main export markets in 2006 were United Kingdom 30.8%, Spain 22.7%, Germany 13.7%, Turkmenistan 10.4%, Switzerland 8.3%, Italy 6.7% while the corresponding figures for imports are Spain 23.4%, Russia 12.3%, Italy 12%, UK 9%, France 8.9%, Netherlands 6.8% and United States 4.7%.<ref>Template:Cite web</ref>
The Gibraltar Government state that economy grew in 2004/2005 by 7% to a GDP of £599,180,000. Based on statistics in the 2006 surveys, the Government statisticians estimate it has grown by 8.5% in 2005/6 and by 10.8% in 2006/7 and that the GDP is probably now around 730 million. Inflation was running at 2.6% in 2006 and predicted to be 2% to 3% in 2007. Speaking at the 2007 budget session, Peter Caruana, the Chief Minister said "The scale of Gibraltar's economic success makes it one of the most affluent communities in the entire world."
Labour force: 12,690 (including non-Gibraltar labourers) (2001)
Labour force - by occupation: services 60%, industry 40%, agriculture NEGL% Unemployment rate 2% (2001)
Budget revenues: $455.1 million expenditures: $423.6 million (2005 est.)
Public debt 15.7% of GDP (2005 est.)
Industries tourism, banking and finance, ship repairing, tobacco
Industrial production growth rate NA%
Electricity - production 142 million kWh (2006 est.)
Electricity - production by source
fossil fuel 100%
hydro 0%
nuclear 0%
other 0%
Electricity - consumption 142 million kWh (2006 est.)
Electricity - exports 0 kWh (1998)
Electricity - imports 0 kWh (1998)
Oil - production Template:Convert (2001 est.)
Oil - consumption Template:Convert 2001
Oil - exports NA (2001)
Oil - imports NA (2001)
Agriculture - products none
Exports $271 million (2004 est.)
Exports - commodities (principally reexports) petroleum 51%, manufactured goods 41%, other 8%
Exports - partners UK, Morocco, Portugal, Netherlands, Spain, US, Germany
Imports $2.967 billion (2004 est.)
Imports - commodities Fuels, manufactured goods, and foodstuffs
Imports - partners UK, Spain, Japan, Netherlands
Fiscal year 1 July - 30 June
The above figures taken from the CIA World Factbook September 2009 edition.<ref>CIA World Factbook</ref>
Interaction with the nearby area
[edit]In September 2009 the Gibraltar Chamber of Commerce released an Economic impact study and analysis of the economies of Gibraltar and the Campo de Gibraltar produced by Professor John Fletcher of Bournemouth University.<ref>chamber releases report on economy</ref> The report aimed at clarifying the effects of Gibraltar's economy on the Campo area. It demonstrated that Gibraltar's economy has a significant and very positive economic impact on the Campo de Gibraltar. It also noted that the Campo region played a "significant role [..] in Gibraltar's economic development as well", concluding that "[b]oth economies and societies would be the poorer without the other..."<ref>An Economic impact study and analysis of the economies of Gibraltar and the Campo de Gibraltar Template:Webarchive, by John Fletcher, September 2009. Introduction (page 2)</ref>
Its conclusions were:<ref name=summary>An Economic impact study and analysis of the economies of Gibraltar and the Campo de Gibraltar Template:Webarchive, by John Fletcher, September 2009. Executive Summary (page 6)</ref> Template:Quote
Taxation
[edit]In 2019, the International Agreement on Taxation and Protection of Financial Interests between Spain and the United Kingdom on Gibraltar was signed by all three countries. This agreement covers such issues as tax co-operation between the authorities in Gibraltar and Spain, the criteria for tax residence of individuals and companies and procedures for administrative cooperation.<ref>Template:Cite web</ref>
Various economic indicators by national origin
[edit]The average annual earnings of Indo-Gibraltarians is nearly twice that of the rest of Gibraltarian people and approximately 1.5 times that of immigrants in the UK, thus making people of Indian descent by far the most economically affluent ethnic group in Gibraltar.<ref>Government of Gibraltar Website</ref>
|
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|