Growth in local GDP dipped in face of global fall
(CNS): The estimated Gross Domestic Product (GDP) figure for last year rose by 2.7%, which falls short of the growth in 2015 of 2.8%, officials said following the publication of the Cayman Islands Annual Economic Report. The Economics and Statistics Office said the dip coincided with a downtrend in global growth from 3.4% in 2015 to 3.1% in 2016. The US also showed a lower growth rate of 1.6% in 2016 compared to 2.6% in 2015.
Officials were nevertheless upbeat about the broader local economy, since the figures show the islands’ economic growth in 2016 was broad-based as all sectors expanded. The top five industries with the highest estimated growth rates include utilities at 5.6% and real estate, renting and business activities, mainly legal and accounting services, at 4.6%. The construction sector also grew by 4.5%.
As previously reported, the central government ended the 2016 fiscal year with a surplus of around $101 million — around $15 million down on the previous year, despite an increase in revenue, as government spending grew by 8.6%.
But with what government said was a strong fiscal position for the public purse, it was able to pay down the debt from $511.0 million as at the end of 2015 to $483.9 million.
See the full Economic Report for 2016 here.
So when growth occurs its because the Minister of Finance is a financial genius, but when it dips, it is because of global conditions. Don’t you just love the spin doctors?
Someone call Marco Archer please he needs to come wave his magic wand and erase this
Yeah, I think it Kenneth’s fault
So Marco Archer, hailed as the messiah of Cayman’s fiscal situation, oversaw an 8.6% increase in government expenditure in a single year? Wow. Finance Minister of the year!
Never seen a better real life version of the Emperor’s New Clothes.
GDP growth? Mostly caused by outrageous and cartel based price inflation methinks. Can anyone tell me why gas prices are rising again when elsewhere they are falling again?
Actually GDP is normally stated in real terms (i.e. in constant prices ignoring inflation).
The real issue is that roughly 300-500% of the GDP growth is accounted for by… you guessed it … Dart investments. Meaning that guess what… we are actually in a recession for all intents and purposes… unless Dart continues spending hundreds of millions of dollars a year indefinitely. (Dart’s level of investment in Cayman last year was roughly the equivalent of a single investor spending 2 trillion dollars in the USA.)
Big construction projects (like the Kimpton or ETH expansion) are the economic equivalent of a 5 hr energy shot. It’s great while it lasts but you’re system is going to crash again when it wears off. What we need are new companies that employ people in good sustainable jobs and fill the buildings Dart is constructing.
Not to mention new people to fill the new jobs – by which I mean work permit holders – unless you believe that the ranks of new companies can be filled entirely by unemployed Caymanians and high school graduates.
Unfortunately we are doing nothing at all to attract new employers and everything to scare away the ones we have.