Offshore financial centres (OFCs) are facing a "Doomsday scenario" as the world's major economic powers try to put them out of business.

That is the view of consultant Rodney Gallagher, who was a leading adviser to the UK Government on Caribbean financial affairs for more than a decade.

Speaking at the OffshoreAlert Financial Due Diligence annual conference in Miami this week, Mr. Gallagher predicted a particularly bleak future for OFCs that are British Overseas Territories, including Bermuda.

Sitting on a panel discussing the future of OFCs, Mr. Gallagher said such jurisdictions were facing a "perfect storm", due to the severe financial crisis, large countries seeking ways to find badly needed extra revenue after the crash of credit markets and the clampdown on tax havens.

"These three things represent almost a catastrophe for offshore financial centres," Mr. Gallagher told delegates.

"The purpose of the OECD's (Organisation for Economic Cooperation and Development) actions is to put OFCs out of business."

The remark by UK Prime Minister Gordon Brown that he could not see the need for OFCs in the global economy represented a "very worrying perspective", coming from the leader of an OECD country with several OFC possessions.

"I am in no doubt that the next five years will see dramatic change and a considerable reduction in the volume of business being done," Mr. Gallagher said.

"Some in the private sector have seen the impact of this already during the first quarter."

Mr. Gallagher is an executive with Florida-based forensic consulting firm Gafney, Gallagher & Philip, which aims to protect the assets of its clients and manage risk. Between 1992 and 1994 Mr Gallagher played a key role in the formation of the Caribbean Financial Action Task Force (CFATF) and also helped establish the joint US-UK White Collar Crime Investigation Team (WCCIT).

"We will see a massive dislocation of OFC business, as business flows to jurisdictions that can adapt - for example, those that have China behind them," Mr. Gallagher said.

He said the relegation of Chinese territories and financial centres, Hong Kong and Macau, to a footnote in the OECD tax transparency lists was no accident. It was an example of international politics at work.

China appears in the "white list" of countries considered to have adopted and implemented international standards.

The footnote states that the two territories are special administrative regions of China that have "committed to implement the internationally agreed tax standard".

Classed as separate jurisdictions, they would have qualified for the "grey list".

"Other survivors will probably include those that have oil money, such as Dubai and Bahrain," Mr. Gallagher said.

"I think we will see nothing survive in Europe, apart from Switzerland. In the Americas, I can see no prospect of survival, apart from Panama and perhaps Barbados. Panama has the Canal - a considerable card to play.

"I'm particularly concerned for the British Overseas Territories."

He said OFCs' chances of retaining their viability depended on shifting the debate over the OECD's project "to bring OFCs into line" to a different international forum, such as the United Nations.

Accompanying Mr. Gallagher on the panel were Bermuda economist and author Bob Stewart and Cayman Islands Financial Services Association chairman Eduardo D'Angelo Silva.

Mr. Stewart said there were ways for offshore centres to offer value in the changing global economy of the near future.

Inflation was inevitable in countries where governments were printing money trying to buy their way out of recession and to bailout huge financial companies, Mr. Stewart said.

"The big opportunity I see for offshore centres is to protect assets from the ravages of inflation," Mr. Stewart said. "Inflation will be a huge problem within two years.

Offshore centres will no longer be sheltering income, they'll be protecting assets."

He suggested that funds based on precious metals - commodities whose value has traditionally kept pace with inflation - were one way of providing such asset protection.

Mr. D'Angelo Silva said education and medical tourism were two areas where offshore centres in the region could diversify and that human talent was the key to a successful economy.