John Garland, Head of Corporate Financial Services, Department of Economic Development
The recent publication of the 2013/14 economic data for the Isle of Man confirmed that it had entered its fourth decade of continuous growth with financial and professional services still representing well over a third of our economy and with a rapidly growing e-Business sector.
With projected growth of 4% continuing to 2020 the Isle of Man seems well on its way to continuing its economic success story despite the ongoing challenges of an ever changing regulatory environment and the slow global economic recovery.
However the data, coupled with the research done in support of development of the Island’s Vision2020 strategy for growth acknowledges that our economy is evolving quicker than anticipated and that the Island was competing for business at an increasingly competitive and global level.
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With the Island’s working population falling in the last few years coinciding with a rapidly ageing demographic, we need to create solutions which will enable even greater jobs growth to support the high levels of public services that we are used to in the Isle of Man.
Oneof the core pillars of Vision2020 – the Island’s economic plan over the next five years – is our ‘Enterprise Isle’ strategy.
The Enterprise Isle initiatives aim to support businesses, from a one-man microbusiness to larger more established businesses wanting to accelerate or relocate to the Island.
As part of Enterprise Isle there are a range of initiatives that are being developed to create the right environment for new and existing businesses to flourish.
For example, within the next 12 months we are looking to introduce a new banking regime which will better meet our business needs now and in the future. This regime is aimed at attracting smaller niche banking operations to establish operations on the Isle of Man. It is especially targeting Foreign Bank branches and subsidiaries, new challenger banks, and representative offices.
We are also looking at regulation for the equity and loan areas of crowdfunding as well as new tax incentives to encourage individuals to support Manx businesses through loans or equity investments.
Business also needs more key infrastructure. So the Isle of Man Government is planning important developments such as a technology park, regeneration of the Island’s capital Douglas and a Masterplan for the area around the Isle of Man Airport.
We are also making it easier for people to come and work in the country with a number of work permit changes taking effect from 1st October and providing greater reassurance and stability for both employers and relocating workers alike.
The major pillar of the Enterprise Isle strategy is a £50million Enterprise Development Scheme.
Enterprise Development Scheme
The Enterprise Development Scheme allows the Isle of Man to take a real stake in its economic future .
The scheme has two objectives: to create jobs on the Isle of Man and to create a real return on investment in order to create an evergreen investment fund.
The Scheme consists of three different levels of funding:
Fledgling:Grant funding for start-ups on-Island (typically with 1-10 employees) of up to £25k.
Accelerator:Loan and equity investment (of up to £250k) for Small to Medium Enterprises (typically with 5-20+ employees) entering their next growth phase.
Relocator: Loan and equity investment (of up to £1million) for establishing or relocating medium to large firms to the Island.
The different tiers of funding will enable us to support development in three stages of business growth, making sure that expansion is nurtured from the ground up and across the many business cycles.
Importantly, the scheme will be managed by a regulated and experienced third party investment manager(s) who can make sure the funds are invested impartially and for the greatest benefit to the Island i.e. jobs and real return.
What’s next for the Isle of Man?
The public consultation on the Enterprise Development Scheme closed on the 6th September, with the Scheme Manager Expressions of Interest closing a week later. The next stages involve carefully examining all of the feedback and integrating it into the final proposed scheme to be sent to the October sitting of Tynwald (Isle of Man Parliament) for final agreement from the members.
Once agreed we will proceed with the tender process to recruit a fund manager(s) with an envisaged launch date of Q1 2016. It’s expected that this will accompany the new crowdfunding legislation and dovetail perfectly with our 2016 UK Regional Roadshow where we will roll out the Enterprise Isle initiatives across the UK.
We are confident that Investing in our future will reap benefits for the Isle of Man by reinforcing our status as a dynamic, successful location for business and by being more responsive to their needs.