Sixties child? The emergence of Jersey as an offshore finance centre 1955–71

Abstract

This paper addresses why the relatively unknown island of Jersey emerged as a major Offshore Finance Centre (OFC) during the 1960s. Was the OFC purely the result of the context of the 1960s and the significant changes in international banking, especially in London, i.e. was Jersey just a child of its times, or was there more to it than that? Orthodox international banking theory would suggest that the location of OFCs is based upon issues of taxation or regulatory differentials, bank secrecy and political stability. However, this paper uses a materialist, fractions of capital approach to analyse the political economy of the onshore state and its specific relationship to its dependent island territories. This paradoxical political relationship underpins the feasibility of OFCs. Arguably, UK financial capital had reached hegemony by the 1960s, giving it the effective regulatory and fiscal ‘space’ for banking innovation as first manifested in the London offshore currency markets (Eurocurrencies), and then la...