World powers will not try to impose a global system in a bid to stamp out suspect tax havens, top financial watchdog Gabriel Mahklouf promised yesterday.

Mr. Mahklouf -- chairman of the Organisation for Economic Cooperation and Development's (OECD) Fiscal Affairs Committee -- said: "I don't think there is any work on tax harmonisation going on in the OECD.'' The Director of the UK's Inland Revenue added: "This has not been a meeting where OECD members have been talking to non-OECD countries.

"This has been a meeting where we have been talking to each other. We have not restricted in any way what the non-OECD countries have wanted to put to us.'' Mr. Mahklouf's statement at a 60-country Paris meeting jointly organised by the OECD and the French Ministry of Finance put to rest fears that the major world powers were aiming for a global tax system. But he said: "Globalisation poses challenges for everybody. It's clear to countries, to many countries, that working together is the best way to meet these challenges.'' George McCarthy, Financial Secretary of the Cayman Islands.

He said: "This meeting should, we hope, have helped the OECD countries have a better understanding of the Cayman Islands, what our fiscal regime is about and also clear up quite a lot of misunderstandings which seem to have emanated over the years.'' `OECD not trying to impose global tax system' The Caymans joined Bermuda and four other countries in pledging to work with the OECD. A further 35 could face some sanctions as early as next year if they fail to sign up.

Mr. Mahklouf said: "Those who don't want to join us will be subject to defensive measures.'' But the OECD was staying tight-lipped over what the 29-nation OECD had asked Bermuda to do before the 2005 deadline.

Philip West of the group's Harmful Tax Committee said: "That question is one for the Bermuda Government.'' Finance Minister Eugene Cox has declined to issue an annexe to a letter to the OECD promising Bermuda's cooperation -- although he has promised to reveal some details in the House of Assembly next week.

Mr. West said: "If there is any confusion in Bermuda, it's not on the part of the officials with whom we've been working.

"We've had detailed discussions with them over many days and we believe that it is in the long-term economic interests of all the affected jurisdictions to move in this direction.'' Truman Bodden, leader of Government Business in the Cayman Islands Legislative Assembly, said: "We remain very optimistic that the process on which our country will continue to prosper and that it is the solution in the long term.

"We have to do some further things, but I think they will be in our best interests.'' Mr. Bodden said much of the details of the annexe to the letter of commitment to the OECD had been released.

And he said his country would continue to cooperate with other overseas territories in a bid to keep in line with the OECD.

OECD Deputy Security General Seeiichi Condo admitted that the OECD had, in the past, been known as "the rich man's club'' -- but he insisted that was no longer the case.

He said: "Globalisation has forced us to change our nature from rich man's club to more a globally orientated organisation which tries to assist good Government throughout the world based upon best practices we have developed over the years.'' And he said: "I think all people of the world will benefit from globalisation, being free from criminal activities.

"This kind of dialogue with non member economies has proven to be very useful. We can learn from experiences of non member economies because of the diversity of their systems, background and culture.'' BUSINESS BUC