Published 21st January 2020, 1:10pm
It is unfortunate I couldn’t bring some of our warm Cayman weather to share with you, but despite the cold, I am happy to be back in New York City at this Cayman Finance New York Breakfast Briefing. This is an opportunity for us to share our thoughts with you and to hear directly from those who do business in the Cayman Islands.
But gatherings like this also provide a platform for me as Premier to say how much we appreciate and value the business relationship of the people in this room – those of you who bring business to us and of course to your clients. You are all an important part of the Cayman Islands economic fabric.
As we embark on a new decade, I am really excited about the prospects for the future of the Cayman Islands.
While there are global uncertainties, I am confident that the Cayman Islands will continue to be the financial services jurisdiction of choice for those who rely on the invaluable professional expertise that we have to offer in providing a variety of solutions for international business, including for funds and insurance.
Indeed, we are enjoying a robust period of economic activity with solid, sustained growth across all sectors, combined with low unemployment, and moderate inflation. Economic growth that along with prudent financial management has provided strong and stable Government finances with operational surpluses that has enabled us to invest in major infrastructure projects and improving public services, while reducing public sector debt and growing our reserves.
To provide some perspective, between 2013 and 2018 the Cayman Islands economy has grown at an average rate of 3.0 per cent per year in real terms. The last two years have been exceptionally good with GDP growth of 3.4 per cent in 2018 coming in stronger than the estimated growth in many of the world’s most advanced economies. And when the final numbers are in, we anticipate that 2019 will see growth of at least 3% for the year.
Economists, however, continue to warn of a coming recession but are undecided on the timing. As such we have conservatively, and I think wisely, forecast slower growth for this year and next, bearing in mind the lowered growth projections of the International Monetary Fund for the Worlds advanced economies over the coming period.
That said, I believe that the foundations that we have put in place in the Cayman Islands will continue to provide a platform for growth in the medium term and that we are today better placed to face any future economic downturn than we were prior to the last recession. So much so that against the backdrop of an anticipated global slowdown the Cayman economy is still projected to achieve growth of 2 to 3 per cent. A demonstration of the strength and vitality of today’s Cayman economy, but in particular our financial services industry.
Our important financial centre role as a tax neutral conduit for international transactions has continued to grow from strength to strength. Despite the prophets of doom, the changes to our business regime to introduce ‘economic substance’ will by all accounts further grow the financial services sector and will bring other benefits to our economy as new businesses of various types open offices and bring staff to the Cayman Islands.
All of this creates new activity and new opportunities for Caymanians for employment as well as for developing and growing businesses into the future.
And as we continue to further develop as an international financial services centre we will always take our international responsibilities seriously regarding tax cooperation and crime prevention. We have a long history of complying with global regulations.
Sadly, our track record remains largely ignored. Many people, who should know better, are still willing to fall back on the tired old trope of Cayman as a haven for shady dealers and dirty money. Some politicians in Europe would rather attack Cayman’s tax neutral status as being unfair than deal with their own crippling tax regimes. Authors and film and television producers seem too lazy to find out facts when they can just use the words ‘Cayman Islands’ to wrongly signify financial secrecy or money laundering.
The latest example of this has been AT&T’s “just okay is not okay” advertising campaign that featured a dodgy accountant and his frequent trips to the Cayman Islands. We responded immediately with a letter demanding they cease and desist. Their response goes through the necessary two paragraphs telling us they do not accept they were at fault (I am an attorney, I get that) before agreeing to change their advert as ‘a goodwill gesture’.
This is now how we will operate going forward. We will not hesitate to challenge illegitimate portrayals of Cayman in the media. Alongside that, however, we will be on a charm offensive, seeking to demonstrate to those with influence in the media industry that Cayman can be represented in a new way – as the great place to live, work, visit and do business that we know it to be.
I know that we can count on the people in this room to assist in these efforts
I thank you for your kind attention this morning and I appreciate the invitation to be with you.