Grand Cayman, Cayman Islands
The economy of the Cayman Islands, a British overseas territory located in the western Caribbean, is mainly fueled by the tourism sector and the financial services sector, together representing 70-80 percent of the country’s gross domestic product (GDP). The Cayman Islands Investment Bureau, a government agency, has been established with the mandate of promoting investment and economic development in the territory. The emergence of what are now considered the Cayman Islands’ “twin pillars of economic development” (tourism and international finance) started in the 1950s with the introduction of modern transportation and telecommunications.
The Cayman Islands are now the fifth-largest banking center in the world, with $1.5 trillion in banking liabilities. There are 279 banks, 19 of which are licensed to conduct banking activities with domestic (Cayman-based) and international clients, the remaining 260 are licensed to operate on an international basis with only limited domestic activity. Financial services generate CI$1.2 billion of GDP (55% of the total economy), 36% of all employment and 40% of all government revenue. The country ranks fifth internationally in terms of value of liabilities booked in the Cayman Islands and sixth in terms of assets booked. It has branches of 40 of the world’s 50 largest banks.
The Cayman Islands are the second largest captive domicile in the world with more than 700 captives, writing more than US$7.7 billion of premiums and with US$36.8 billion of assets under management. There are a number of service providers. These include global financial institutions including HSBC, Deutsche Bank, UBS, and Goldman Sachs; over 80 administrators, leading accountancy practices (incl. the Big Four auditors), and offshore law practices including Maples & Calder. They also include wealth management such as Rothschilds private banking and financial advice. Caymanians enjoy one of the highest outputs per capita and one of the highest standards of living in the world.