Cayman’s economy grows 3.8% in first quarter 2022
Cayman’s economy grows 3.8%
The Cayman Islands economy was slightly ahead of government’s growth projections in the first quarter of this year, as Cayman’s economy grows by 3.8%. Speaking on the Cayman Compass Facebook talk show The Resh Hour, Finance Minister Chris Saunders expressed his optimism, stating that he is “very bullish in terms of the fundamentals” of the local economy. Despite conservative government estimates putting GDP growth at 3.4% for the year, the actual growth of 3.8% in Q1 showcases the strong performance and potential of Cayman’s economy.
At the same time, the United States economy contracted during the first quarter by 1.6%, Saunders noted.
The results showed that Cayman’s economy was sound, the minister said, but he cautioned that inflation remains very high at a projected 10% this year.
Last year Cayman’s economy emerged from the COVID pandemic with a gross domestic product growth rate of 1.8% as pent-up demand and robust growth in financial services provided a backbone for economic expansion.
The expansion was led by accelerated growth in construction (7.9%), real estate activities (6.3%) and wholesale and retail trade (5.4%), the Economics and Statistics Office said in its annual economic report.
Local demand was matched by equally strong international demand as advanced economies expanded by 5.2%, with the US economy growing by 5.7%.
The higher income levels among Cayman’s main trading partners led to a rise in demand for key services. The finance and insurance sector grew by 1.8%, while business services such as legal and accounting services, expanded by 2.8%.
Despite strong demand, Cayman’s economy trailed the growth rates of advanced economies last year, because the islands’ ports remained closed for most of 2021.
The decline in tourism and travel-related services was evidenced by the hotels and restaurants sector, which declined by 21.4%, while transport and communication fell by 13%.
At the end of 2021, central government recorded an operating deficit of $18.1 million; operating expenditures reached $979.2 million while operating revenues climbed to $961.1 million.
This year, through July, the entire public sector has generated a financial surplus of $129.6 million, $25.2 million larger than expected in the budget.
Source: Cayman Compass