Brexit Shocks the World, Panama Papers Expose the Powerful, Orlando Is Massacred and Istanbul Is Bombed

Jamaica Homes Global Conflict & Caribbean Impact Review | Published 3 July 2016 | Reporting Period: 3 April – 2 July 2016

Quarterly Briefing

• The United Kingdom votes 52 to 48 per cent to leave the European Union on June 23; Prime Minister David Cameron resigns the following morning, and Britain enters a period of acute political and economic uncertainty that continues as this edition is published.
• The Panama Papers — 11.5 million documents from the Panamanian law firm Mossack Fonseca — are published on April 3, exposing the offshore financial arrangements of heads of state, politicians and business figures worldwide.
• A gunman claiming ISIS allegiance kills 49 people at the Pulse nightclub in Orlando, Florida, on June 12 in the deadliest mass shooting in US history.
• Suicide bombers kill 45 people at Istanbul’s Atatürk International Airport on June 28 in an attack attributed to ISIS; it is the deadliest terrorist attack at an airport in history.
• Iraqi forces, backed by the US-led coalition, launch an offensive to retake Fallujah from ISIS in May; the city is declared liberated in late June after a month of fighting.
• Syria’s civil war continues with no resolution; the Geneva peace process has failed to produce a ceasefire and humanitarian access to besieged areas remains severely restricted.

Prologue: The Quarter Britain Left Europe

When history books record the second quarter of 2016, Brexit will be the dominant event: the decision by a major Western democracy to leave the world’s largest trading bloc after forty-three years, driven by a populist campaign whose most prominent arguments about sovereignty and immigration were contested even before the votes were counted. The shock of the result — which most opinion polls had not predicted with confidence — sent sterling to its lowest level in thirty years, wiped more than £100 billion from the value of UK-listed companies in a single day and precipitated an immediate political crisis in both of Britain’s major parties. For Jamaica and the Caribbean, a region with profound historical, cultural, diplomatic and economic ties to Britain, the vote to leave was a moment of genuine consequence. Add to it the Panama Papers’ exposure of elite financial opacity on an industrial scale, a mass killing in Florida that struck the Caribbean diaspora at its heart, and an ISIS massacre at one of Europe’s busiest airports, and the quarter’s weight becomes clear.

Brexit and Its Caribbean Consequences

The June 23 referendum result — 52 per cent for Leave, 48 per cent for Remain, on a turnout of 72 per cent — was announced in the early hours of June 24. Cameron resigned at 8am. Within hours, sterling had fallen 10 per cent against the dollar, markets across the world had plunged, and the European project’s decades of accumulated momentum had, for the first time, suffered a genuine reversal. Scotland, which had voted 62 per cent for Remain, immediately renewed calls for a second independence referendum. Northern Ireland, also majority Remain, raised questions about the Irish border. The political chaos in Westminster was profound: the Conservative Party was divided, the Labour Party was in open revolt against its own leader, and the country faced a leadership vacuum at a moment of maximum external pressure.

For Jamaica, the Brexit vote had multiple dimensions. Britain is a primary source of tourists to Jamaica and one of the largest destinations for the Jamaican diaspora. The EU’s Caribbean Economic Partnership Agreement, which governs trade preferences for the region, would need renegotiation to include an independent UK arrangement. The status of Jamaican and other Caribbean nationals living and working in the UK under EU freedom of movement principles was suddenly uncertain. And the reduction in the pound’s value had an immediate effect on the purchasing power of UK-based Jamaicans sending remittances home. As of this writing, the UK has no new prime minister and no clear timetable for what comes next.

The Panama Papers

On the very first day of this reporting period — 3 April 2016 — the International Consortium of Investigative Journalists published the first stories from 11.5 million leaked documents from Mossack Fonseca, a Panamanian law firm that had administered offshore structures for clients in 200 countries. The papers exposed the offshore accounts of twelve current and former heads of state, over 60 relatives and associates of world leaders, and hundreds of celebrities, athletes and businesspeople. Iceland’s prime minister resigned within days. Pakistan’s Prime Minister Nawaz Sharif, British Prime Minister David Cameron and Russian President Putin’s inner circle were all named. The reaction demonstrated both the public’s visceral reaction to evidence of elite tax avoidance and the practical difficulty of translating public anger into legal consequences.

For the Caribbean, the Panama Papers had both direct and indirect relevance. Several Caribbean jurisdictions — the British Virgin Islands, Cayman Islands and others — were prominently featured as nodes in the offshore structures exposed by the documents. The Caribbean’s reputation as an offshore finance centre — a sector of genuine economic importance to several territories — was placed under further pressure, with renewed international calls for greater transparency and automatic exchange of financial information.

Orlando and Istanbul

The attack on the Pulse nightclub in Orlando, Florida, on 12 June killed 49 people and injured 53 in what became the deadliest mass shooting in United States history. The attacker called 911 during the attack to pledge allegiance to ISIS; investigators later found his motivations were complex, with elements of personal psychological crisis as well as ideological influence. The location — a gay nightclub on a Latin Night — meant the victims were drawn heavily from LGBTQ+ communities and the Latin American and Caribbean diaspora. The Jamaican and wider Caribbean community in Florida mourned alongside their American neighbours.

Two weeks later, on 28 June, three suicide bombers attacked Atatürk International Airport in Istanbul, killing 45 people and injuring hundreds more in the arrivals terminal. The attackers were identified as nationals of Russia, Uzbekistan and Kyrgyzstan, pointing to the Central Asian component of ISIS’s fighter network. The attack was a reminder that major international airports — hubs of the global travel economy on which Caribbean tourism depends — remained soft targets in the pre-security screening areas that no cordon can fully protect.

Looking Ahead

Brexit’s immediate political crisis will resolve in the coming weeks with a new UK prime minister, but the two-year negotiation process it has initiated will shape British and European politics for years. The US presidential election enters its final phase with Donald Trump as the Republican nominee; the November result will have profound implications for the Caribbean’s most important bilateral relationship. The ISIS caliphate continues to lose territory in Iraq and Syria but continues to inspire attacks globally. And Venezuela’s economic crisis deepens with oil prices remaining well below the levels its budget requires. Jamaica enters the second half of 2016 with the global environment presenting more uncertainty than at any point since the 2008 financial crisis.

Jamaica Homes Global Conflict & Caribbean Impact Review is published quarterly, examining how wars, geopolitical tensions and major international crises have shaped Jamaica, the Caribbean and their economies.

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