28 Apr 2020
Sunny skies interspersed with fluffy clouds. Sparkling turquoise-coloured waters inviting marine adventures. Sugar-white sand beaches framed with casuarina and stately palm trees. Resort-wear clad visitors enjoying…
Stop. The visitors are absent. A vital part of the Cayman Islands is missing. And with them has disappeared something even more important – confidence. As each day is passed complying with shelter-in-place guidelines (was that phrase even part of vocabulary prior to 2019?), concern mounts about the future of the tourism industry and, indeed, the economy of the Cayman Islands.
Those concerns are well-founded. It is disconcerting, living on a 22-mile-long island with all access to the rest of the world, save a few air-bridge flights, cut off. Coping with the unknown of when the visitors – whose spending contributes to the approximate 40% of the country’s GDP generated by tourism – can return is a challenge.
The best part of a challenge is that it invites solutions, it encourages resourcefulness, and it produces a strong focus on desired outcomes. The Cayman Islands community has embraced that challenge with an energy and immediacy that has produced stories of inspiration and an impressive display of economic resilience. Here are five reasons why the Cayman Islands response to the COVID-19 demonstrates the unique strength, power and agility of this jurisdiction. In the face of a global pandemic, it turns out there aren’t many better places to be.
165,000 COVID-19 test kits
It’s the stuff movies are made of. The story of how the test kits were ordered at a time when most global travel has ceased, the collaboration of virtual strangers that spanned across countries to organise the shipment, and the speed by which the entire process happened successfully on a “wing and a prayer,” was uniquely Caymanian. Read the full story here – it will hopefully serve as a reminder that human ingenuity and determination will overcome the challenges currently posed by the pandemic.
Private sector fund supporting COVID relief efforts
Dart donated CI$1 million to a new private sector-led fund to support disaster preparedness, relief and recovery efforts in the Cayman Islands, and has agreed to a further $4 million to match donations made by others in the private sector. Although established in response to the economic and humanitarian hardships caused by the COVID-19 pandemic, the fund will coordinate resources and expertise to support the jurisdiction’s preparedness, response and resilience in the event of future emergency situations.
No direct taxes will be levied
A spike in taxation across the globe is anticipated to follow the bailouts currently being implemented by governments across the globe. Finance Minister Roy McTaggart has noted that imposing direct taxation to cover a deficit would be “economic suicide.” Minister McTaggart reported that Cayman has CI$500 million in accumulated cash reserves to cover shortfalls and that, due to low interest rates and the country’s strong credit rating, there is the option of raising debt if necessary. More details on Cayman’s current economic position can be read here.
Public and private sector support
Commerce Minister Joey Hew announced a low-interest CI$5 million loan programme for 100% Caymanian-owned micro and small businesses and a grants initiative for local businesses that could survive the immediate post COVID-19 economy. An additional $9 million grant programme for up to 3,000 small and micro businesses has also been introduced. Local businesses can also participate in training and support programmes offered by the Cayman Islands Government and the Chamber of Commerce.
The private sector has also been quick to offer support. Examples include: Deloitte Cayman staff and partners raising $50,000 for community support; major banks deferring mortgage payments for at least three months; RBC donating $330,000 to support food security across the region; and employees at Dart’s hotels on Grand Cayman receiving salaries through to the end of May.
Real estate sales continue
Tourism is not the only industry reliant on in-person contact. The Cayman Islands’ thriving real estate sector, which has been enjoying record growth in recent years, also depends on interactions with clients visiting the island, touring properties for sale and conducting transactions with realtors, lawyers and bankers. The real estate industry has been quick to adapt to shelter-in-place guidelines by producing virtual tours, engaging with clients via video calls and working with industry colleagues to find ways to process sales and residency-by-investment applications across the miles.
A record residential sale of $14.5 million was recorded in late March by Property Cayman. Provenance Properties, the official Christie’s International Real Estate affiliate in Cayman put a luxury residence under contract in April. CIREBA, the MLS system for the country, reported 51 properties as pending/conditional from 9 March to 7 April. Realtors report that inquiries continue to be received, with callers expressing interest in Cayman due to its stability, strong infrastructure, sound governance and demonstrated business continuity.
Do these positive reports mean that the economic situation in Cayman is not serious? Absolutely not. The impact of the tourism industry has been immediate and significant, and every day that a shelter in place remains, challenges for business owners in every sector increase. But what these examples do show is a community based on solid economic fundamentals. It is a community with the resolve and resources to confront the current issues being experienced by every segment of the economy and one with the potential to emerge #caymanstrong.
About the author
Sue Nickason has been VP Marketing and Sales at Dart Real Estate since May 2017. Originally from Canada, Sue has worked in luxury residential-resort development in the Caribbean for over a decade. Sue and her team are committed to promoting the unique value proposition of the Cayman Islands to those seeking to establish a personal and/or corporate presence here. They serve as trusted advisors and offer exceptional service, timely market information and a warm “Caymankind” welcome. Sue earned a BA (Honours) from Mount Allison University, an MBA (Distinction) from University of Guelph and has completed studies/earned certificates in journalism, economic development, adult education, customer service, revenue management, and protocol. Sue is a member of the Christie’s International Real Estate Master’s Circle and an Angel in the 100 WIF network.