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Economy of the Cayman Islands: A Brief History by the Two Major Sectors

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Economy of the Cayman Islands: A Brief History by the Two Major Sectors

Savage Consulting | Jan 17 2018
Economy of the Cayman Islands: A Brief History by the Two Major Sectors

Both the Cayman Islands’ economic history and bright future is full of opportunity, growth, and constant expansion. The emergence of the ‘twin pillars of economic development’ for Cayman, tourism and international finance, emerged around 60 years ago with the introduction of modern telecommunications and transportation.

Let’s briefly explore the small trio of islands economic outlook since the beginning of it hitting the exponential growth curve that short time ago.

Tourism

Once these isolated islands became accessible, it was only a matter of time before someone seized the opportunity to monetize on the beauty here.

The current upscale tourist sector caters to mostly North American tourists looking for a safe Caribbean island with modern luxuries including fine dining, scuba diving, and unique experiences like Stingray City… but it wasn’t always this way.

An adventure seeking capitalist discovered the opportunities lying in wait in 1950. The Englishman Benson Greenall built the first hotel, unknowingly sparking the launch of Cayman’s ever growing tourism industry.

By the late 1960’s Cayman was seeing its first cruise ships on the horizon. At first they were a rare occasion — the 1970’s saw only 8 or so ships per year — but by the 1990’s cruise ship tourism exploded for Cayman. In fact, last year 302 cruise ships visited the islands.

Once discovered, exponential growth was inevitable. White sand beaches, crystal clear water, unrivaled diving… it’s easy to see why 30% of the country’s GDP is now comprised of high-end tourism.

Finance

In 1966 the Cayman Legislative Assembly followed in the footsteps of Bermuda and Bahamas to pass the Banks and Trust Companies Law. This laid the groundwork for Cayman to become the financial hub it is today.

Sir Vassel Johnson, the Cayman Islands’ one and only Knight, is considered the pioneer of the financial sector movement. As the first financial secretary, Sir Vassel is remembered as “one of the architects of modern Cayman” [source]. He himself, in fact, authored a book on the subject of Cayman’s economy in association with finance titled “The Cayman Islands Economic and Financial Review and As I See It: How Cayman became a Leading Financial Centre.”

As of June last year, 158 licensed bank and trust companies exist in the Cayman Islands. There has been a continued increase in business registrations in Cayman, this past year seeing an overall increase of 9.9%. Cayman's stocks also increased this past year with the number of listed stocks on the Cayman Islands Stock Exchange increasing by 3.9%. The overall GDP of Cayman’s financial sector increased by 1.4% from 2016 to 2017, accounting for the largest portion of GDP at around 55%.