The Cayman Islands economy is booming. How and even whether to keep it booming in the face of international regulatory pressures and increasing domestic infrastructure strains were questions raised at the Cayman Islands Chamber of Commerce’s 2019 Economic Forum on 19 June at Kimpton Seafire Resort + Spa.
In his “State of the Economy” address, Minister of Finance and Economic Development Roy McTaggart noted that the Cayman Islands was currently enjoying an exceptionally robust period of economic activity that featured solid growth across all business sectors, low and falling unemployment and strong government finances that were generating operational surpluses and decreasing public debt.
Referring to specific industries, McTaggart said the hotel and restaurant sector, the construction sector, the financial and insurance services sector and the business services sector all experienced growth in 2018.
McTaggart said the economic situation in the Cayman Islands was something everyone in the country could be proud of, but the prosperity shouldn’t be taken for granted.
“We need to maintain our focus, support our dynamic business community and take decisions the country needs if we are to continue to prosper in the future.”
The Cayman Islands has set out to reduce financial and administrative burdens on businesses, particularly small businesses, McTaggart said.
“It was good to see that our efforts are being recognised with the publication [on 4 June] of a new Global Business Complexity Index that had Cayman in last place, recognising this jurisdiction as the easiest place in the world in which to do business,” he said. “Finally, a league table where we can be happy to be in last place.”
McTaggart said the government was maintaining full compliance with the Principles of Responsible Financial Management in terms of operating surplus, net worth, debt servicing cost, net debt and cash reserves.
Later in the forum, two other speakers — economist Paul Byles and Caribbean Utilities Company President and CEO Richard Hew — both mentioned the importance of the government’s demonstrated fiscal responsibility in the Cayman Islands’ continued long-term economic prosperity.
After outlining a number of approved public infrastructure projects, McTaggart said growth in the medium term would continue to be driven by the private sector.
In addition to three approved hotel projects, McTaggart listed several retail and residential projects, including three in Camana Bay — the Cayman International School expansion, the new Foster’s Food Fair and the OLEA residential development.
“The government is committed to working with the private sector to ensure the long-term sustainability of a flourishing economy while also preserving the unique qualities that make the Cayman Islands such a wonderful place to live, work, visit and do business,” McTaggart said.
He noted that Premier Alden McLaughlin had already outlined how the government intends to address growth in a planned and sustainable manner that will ensure the best use of available land while preserving Grand Cayman’s environmental heritage.
“The Plan Cayman development framework, which has now completed its first round of public consultation, will focus on one major land area at a time,” he said, adding that a plan for the Seven Mile Beach corridor is now being developed and that it would look at the possibility of allowing taller buildings and commercial and residential mixed-use developments.
Speaking on a panel that discussed the merits and time frame of increasing the Cayman Islands population to 100,000, Dart Executive Vice President Real Estate Development and Operations Justin Howe said that with land on Grand Cayman being a scarce and finite resource, the opportunity was to “go, and grow, up, not out.”
“At Dart, we recognise the benefits of taller buildings in certain areas of Grand Cayman such as George Town and the Seven Mile Beach corridor,” he said. “With a smaller footprint, tall buildings have a lower environmental impact, infrastructure demands are reduced and those challenges are solvable.”
Howe said Dart’s proposal to build an “iconic tower” — one that would be the tallest building in the Caribbean — had the potential to become a symbol of the Cayman Islands’ standing on the world stage.
“Its purpose would be twofold; to signal Cayman’s strength and to continue to attract visitors, including high-net-worth visitors whose spending has a disproportionately positive impact on the economy and revenues to the country.”
He said the central components of the iconic tower would be a five-star hotel and branded residences and that if Dart were to proceed on the project, it would also continue to invest in infrastructure and workforce development.
Howe noted that with or without the iconic tower, Cayman’s population would continue to grow.
“Our population density is nowhere close to the likes of Dubai, Monaco or Singapore,” he said. “If growth is planned, thoughtful and well-managed, we can learn from their success and avoid their mistakes. If increasing building heights is inevitable, then designing the skyline is our chance to innovate.”