Economy of the Cayman Islands
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From the earliest settlement of the Cayman Islands, economic activity was hindered by isolation and a limited natural resource base. The harvesting of sea turtles to resupply passing sailing ships was the first major economic activity on the islands, but local stocks were depleted by the 1790s. Agriculture, while sufficient to support the small early settler population, has always been limited by the scarcity of available land. Fishing, shipbuilding, and cotton production boosted the economy during the early days of settlement. In addition, settlers scavenged shipwreck remains from the surrounding coral reefs.
The advent of modern transportation and telecommunications in the 1950s led to the emergence of what are now considered the Cayman Islands' "twin pillars" of economic development: international finance and tourism. The Cayman Islands Investment Bureau is a Government agency established with the mandate of promoting investment and economic development in the Cayman Islands.
The boom in the Cayman Islands' international finance industry can also be at least partly attributed to the colony having no direct taxation. A popular legend claims that England granted it tax-free status because Caymanians rescued most of the victims of the Wreck of the Ten Sails, in which ten British ships ran aground on the reefs off Grand Cayman in 1794. Whether or not the legend is true, the Cayman Islands' tax-free status has attracted numerous banks and other companies to its shores. More than 40,000 companies were registered in the Cayman Islands as of 2000, including almost 600 banks and trust companies, with banking assets exceeding $500 billion. Large corporations based in the Cayman Islands include Seagate Technology, Semiconductor Manufacturing International Corporation (SMIC), Garmin Ltd. and Transocean Inc. The Cayman Islands Stock Exchange was opened in 1997.
Tourism is also a mainstay, accounting for about 70% of GDP and 75% of foreign currency earnings. The tourist industry is aimed at the luxury market and caters mainly to visitors from North America. Unspoiled beaches, duty-free shopping, scuba diving, and deep-sea fishing draw almost a million visitors to the islands each year. Due to the well-developed tourist industry, many citizens work in service jobs in that sector.
Because the islands cannot produce enough goods to support the population, about 90% of their food and consumer goods must be imported. In addition, the islands have few natural fresh water resources. Desalination of sea water is used to solve this. Despite those challenges, the Caymanians enjoy one of the highest outputs per capita and one of the highest standards of living in the world.
Education is compulsory to the age of 16 and is free to all Caymanian children. Most schools follow the British educational system. Ten primary, one special education, a high school and a middle school ('junior high school') are operated by the government, along with three private high schools. In addition, there is a law school, a university-college and a medical school.
[edit] Statistics
GDP: purchasing power parity - $1.939 billion (2004 est.)
GDP - real growth rate: 1.7% (2005 est.)
GDP - per capita: purchasing power parity - $43,800 (2004 est.)
GDP - composition by sector:
agriculture: 1.4%
industry: 3.2%
services: 95.4% (1994 est.)
Population below poverty line: NA%
Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA%
Inflation rate (consumer prices): 4.4% (2004)
Labor force: 23,450 (2004)
Labor force - by occupation: agriculture 1.4%, industry 12.6%, services 86% (1995)
Unemployment rate: 4.4% (2004)
Budget:
revenues: $423.8 million
expenditures: $392.6 million, including capital expenditures of $NA (1997)
Industries: tourism, banking, insurance and finance, construction, construction materials, furniture
Industrial production growth rate: NA%
Electricity - production: 441.9 million kWh (2003)
Electricity - production by source:
fossil fuel: 100%
hydro: 0%
nuclear: 0%
other: 0% (1998)
Electricity - consumption: 411 million kWh (2003)
Electricity - exports: 0 kWh (1998)
Electricity - imports: 0 kWh (1998)
Agriculture - products: vegetables, fruit; livestock, turtle farming
Exports: $2.52 million (2004)
Exports - commodities: turtle products, manufactured consumer goods
Exports - partners: mostly US (2004)
Imports: $866.9 million (2004)
Imports - commodities: foodstuffs, manufactured goods
Imports - partners: US, Netherlands Antilles, Japan (2004)
Debt - external: $70 million (1996)
Economic aid - recipient: $NA
Currency: 1 Caymanian dollar (CI$) = 100 cents
Exchange rates: Caymanian dollars per US dollar - 0.82 (29 October 2001), 0.83 (3 November 1995), 0.85 (22 November 1993)
- See also : Cayman Islands
[edit] References
This article contains material from the CIA World Factbook (2006 edition) which, as a US government publication, is in the public domain.
