| Summary/Abstract |
China’s economic ties with the British Virgin Islands (BVI) exemplified global finance beyond national borders in the post-cold war period. This relationship now serves as an example of global finance’s more tenuous foundations as social and political forces coalesce against the offshore economy. The article establishes the defining conflict as the tension between national/global regulations and an Asian-headquartered network that coordinates offshore financial flows. The analysis outlines how the global network connecting Asia to the Caribbean has receded. Several factors are decisive. First, global and national forces are now aligned. Because global regulatory change is predicated on minimum standards only, domestic commitment to global regulatory norms is critical. Domestic commitment to the new international taxation regime is variable but a key development is that many large emerging markets have committed to the effort. China has forcefully imposed new restrictions on the offshore economy, including closing down routes for capital exit. One result is that the BVI–China relationship, after deep financial interconnections, is on a downward trajectory. The larger pattern than deserves further analysis is how action by China—along with India and Indonesia—suggests that substantive reform of the global offshore economy, led by Asian actors, is possible.
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