Tourism fuels 2019 economic boom

| 19/06/2020 | 15 Comments
Cayman News Service

(CNS): The Cayman Islands’ gross domestic product (GDP) is estimated to have grown by 3.4% in the first nine months of 2019, according to a report from the Economics and Statistics office released this week. Based on data collected between January and October, well before the COVID-19 pandemic shattered Cayman’s economic fortunes, the report showed there was “robust economic growth” last year.

ESO officials said in The Cayman Islands Third Quarter Economic Report 2019 that the strong economic performance was driven by all major sectors but it was the growth in tourist arrivals, which was up by 10.3%, that led the economic activity.

The figures were published against the backdrop of comments made by the premier on Wednesday that stay-over tourism “had been a massive failure” for Cayman because the jobs it created were mostly held by expatriate workers.

With the highest growth rates in hotels and restaurants and retail last year, the construction sector, which government is now depending on to fuel the domestic economic recovery, was in third place and real estate just behind it.

But there are concerns that development, which is dependent on overseas investors to finance and buy the condos and hotels under construction, is likely to suffer significantly in the absence of visitors.

As a result, trickle down from the financial services sector is likely to remain the main driver of the domestic economy, with the fees from the industry feeding a cash-strapped government. But in 2019 the sector experienced growth that was steady at 2.2% but well behind many other areas of the economy. However, the survival of that industry in the post-COVID-19 economy will be critical, given the collapse of tourism.

Government has stated that the biggest challenge it now faces is reopening the borders without endangering the community, given the risk of visitors bringing in new and possibly more virulent strains of the coronavirus. Although the premier has said Cayman is working towards reopening the airport on 1 September, government has not yet worked out how it will do it.

The premier has also stated that cruise tourism is unlikely to return until well into next year.

Meanwhile, the ESO said that during the first three months of last year central government’s outstanding debt decreased, which continued to the end of the year, the finance ministry has since reported.

The current debt balance is CI$284.4 million, which is relatively low, after the government met a bullet bond payment at the end of the year. But given the opportunity for access to cheap loans, government is in a position to borrow heavily to navigate its way through the forthcoming economic slump.

The finance minister recently revealed that he was seeking to secure a half-billion dollar stream of financing to help government through the next year or so, which could see the economy decline by as much as 12%.

See the full report on the ESO website


Share your vote!


How do you feel after reading this?
  • Fascinated
  • Happy
  • Sad
  • Angry
  • Bored
  • Afraid
Print Friendly, PDF & Email

Tags:

Category: Business, Economy, Politics, Tourism

Comments (15)

Trackback URL | Comments RSS Feed

  1. Anonymous says:

    It’s hard to build a country when even the Premier is an economic illiterate. What industry in Cayman IS a success that generates big GDP? Money laundering and tax evasion? What else, other than tourism, do you have that provides the infrastructure and leisure amenities that attract the big foreign investors? The time for Alden to go is long overdue. He’s an idiot, to put kindly.

  2. Anonymous says:

    Depends. Most of us live in multigenerational family homes. Which are owned outright by our parents or grandparents. Most of my friends pay no rent, and instead own nice cars. I decided to buy my own home, so I have a crappy Kia. Yet no Caymanian can live on $6 an hour. But my parents have a Filipino helper, They pay her $300 a week. She lives with a bunch of other Filipinos and sends half of her pay back home. In the Philippines $150 CI a week is the equivalent of $1500 here. So it is all relative.

    2
    1
  3. Anonymous says:

    Moot point when second wave of Covid hits. At least we know the drill.
    Most mainstream media are now predicting a vaccine by Christmas.
    If you think Cayman was locked down this time, you have seen nothing.

    I am almost certain that the powers that be are hoping for a mandatory roll-out to eliminate the back and forth, start-stop nature of this plague, so we can get back to some form of normal.

    Fortunately, our military should be well-drilled by then under the direction of the fine army commandos that are embedded at Government Admin Building with Mr. Roper. Our first 5 officers are due back from UK in a few weeks and basic training for the next 50 or so recruits will be well under way.

    A well-executed operation aided by the police and medical community could probably have the entire Cayman Islands vaccinated in 30 days and then I am sure that we will not accept any visitors without a Certificate of Vaccination ID. (Covid). Talk on the street is that this may be some form of physical mark such as a tattoo that shows up when irradiated by a certain type of light. (Nothing to lose I guess, and thankfully no nasty face masks to wear.)

    We shall see, but there will be no surprises if and when Wave 2 hits. Wave 1 was devastating, Wave 2 could be catastrophic.

  4. Anonymous says:

    Whatever Government does make sure not to help those of us in tourism. Give money to anyone else but us. If you cannot find another group, other than tourism, than start a big bonfire and burn money that would save our businesses. Whatever you do do not help us. We are clearly of no value.

  5. Anonymous says:

    Given early 2020’s bewilderingly frequent seismic events stemming from the unexplored 20,000 ft deep Cayman Trench, just 20 miles south west of Grand Cayman; and the attendant unknown tsunami landslide risks to the low-laying population that accompanies at least 7 x10,000ft high submarine mounts, the Cabinet, Hazard Management Cayman Islands and the Marine Authority of the Cayman Islands should try to better understand the sources and risks. We could offer a special registration allowance/incentive to all Cayman Islands flagged vessels willing to contribute detailed submarine mapping data of the Greater Antilles trench for the Seabed 2030 global mapping initiative. For the number of vessels flagged to our territory, we ought to have the best dataset on Earth. We’d probably find some interesting wrecks and Uboat victims while we’re at it. We need a government that is willing to be proactive rather than reactive.

    https://www.bbc.com/news/science-environment-53119686

  6. anon says:

    Spain has just announced an indefinite ban on cruise ships. Let them all go to Cuba.

    11
  7. Anonymous says:

    5 to 7 years and we will come back to last year’s level economically, assuming we do not get hit with another Ivan during that period.

    The inability of America / Florida to get it’s act together on health policy and related matters is ultimately going to determine the timeline for our economic revival.

    8
    3
    • Anonymous says:

      Sadly, the earliest the USA might change it’s public health policy, or re-impose curfew measures (irrespective of second waves or bodycounts) is long after their November Presidential election, and at least until a regime handover in Jan 2021 – if that’s even the outcome. It seems around half of America still supports the conspiring, judicial-meddling, mask-off President, despite what will be around 200,000 dead Americans by then.

      6
      4
  8. Anon says:

    Didn’t the premier stay that area of tourism was a failure? Oh yes its because we did not build the port….I ask you

    11
    2
  9. Anon says:

    “Those were the days, my friend, we thought they’d never end, we’d sing and dance forever and a day -“

    15
    1
    • Anonymous says:

      What would it cost to raise the minimum wage to $10 an hour?

      Now is the time to get Caymanians into the tourism and retail sector and keep expats out of that sector. This is our chance before the expats start coming back late next year.

      11
      7
      • Anonymous says:

        Raise it to $25 or $50. How about ask for a million one time payment just because it’s you? Better yet start your own hugely successful business and pay your workers the big bucks you earned that they deserve.

        4
        7
        • Anonymous says:

          10:30, You try living on $6 or less an hour. Bet you would have loved slavery. Find your humanity 10:30.

          If you think $10 an hour is big bucks then you are delusional.

          10
          6
          • Bertie : B says:

            Agreed 4:57 , at $ 10 bucks an hour you cant afford a pot to piss in , or as my Caymanian sister reminds me , a window to throw it out . Hey Sis be home soon God Willing .

      • Moderate increase needed says:

        There needs to be an adjustment to the minimum wage. $4.50 with grats is not going to encourage Caymanians into tourism. Maybe that is why government agreed to include it as part of tourism workers basic hourly wage. Does the Government really want Caymanians in tourism?
        Start with $7 per hour not including tips. We also must understand if wages are too high business will close down.

        5
        1

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.