The Caymans
Adventure Guide to the Cayman Islands
To the outsider, the Cayman Islands - Cayman Brac, Grand Cayman and Little Cayman - are almost always equated with watersports and glorious beaches, plus offshore banking opportunities.
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Cayman Islands Alive!
Just 70 minutes by plane from Miami and a few hours from New York, this charming trio of islands has captured attention worldwide.
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Cayman Islands Alive
A 272-page guide to the shopping, hotels, restaurants and activities
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History
The Cayman Islands - often referred to as The Caymans, or (more correctly) just Cayman - were first visited by Christopher Columbus on May 10, 1503 during his fourth and final voyage to the New World. The first recorded English visitor to the islands was Sir Francis Drake, who landed there in 1586 and named them the Cayman Islands after the Neo-Taíno nations term (caiman) for crocodile (Zayas, 1914).
The first recorded permanent inhabitant of the Cayman Islands, Isaac Bodden, was born on Grand Cayman around 1700. He was the grandson of the original settler named Bodden who was likely one of Oliver Cromwell's soldiers at the taking of Jamaica in 1655.
The islands, along with nearby Jamaica, were ceded to England in 1670 under the Treaty of Madrid. They were governed as a single colony with Jamaica until 1962 when they became a separate British overseas territory and Jamaica became an independent commonwealth realm.
The island of Grand Cayman was severely damaged by the Category Five Hurricane Ivan in September 2004, which destroyed many buildings and damaged most of them. Power, water and communications were all disrupted. Ivan was the worst hurricane to hit the islands in 86 years. The island has made rapid recovery since Ivan, with most of the infrastructure now restored.
The Cayman Islands are an overseas territory of the United Kingdom in the western Caribbean Sea comprising the islands of Grand Cayman, Cayman Brac, and Little Cayman. It is known as one of the largest tax havens in the world.
Economy
The economy of the Cayman Islands used to be built around turtling. However, this industry began to disappear in the 20th century and tourism and financial services began to become predominant due to the advent of modern transportation. The United States of America is the Cayman Islands' largest trading partner.
With an average income of around $35,000, Caymanians enjoy the highest standard of living in the Caribbean. The islands print their own currency, the Cayman Islands Dollar (KYD), which is pegged to the US dollar at a fixed rate of 1 KYD = 1.227 USD. Thus, the C.I. Dollar's rate of exchange with all other world countries is directly tied to the U.S. Dollar's rate of exchange with those same countries.
The government's primary source of income is indirect taxation. An import duty of 20% is levied against goods imported into the islands. Few goods are exempt; notable examples include books, cameras & baby formula. Duty on automobiles is charged on a sliding scale with the duty reaching 40% for expensive models. The government charges a flat licensing fee to financial institutions that operate in the islands. A small fee is also charged to each tourist that arrives on the islands.
Tourism
Tourism accounts for 70-75% of the annual GDP of the Cayman Islands and is hence a major part of the economy. Of the millions of tourists that visit the islands annually, 99% of the them stay on Grand Cayman. George Town also serves as a major cruise ship port, which brings in 2,000-3,000 tourists a day, 5 days a week.
Grand Cayman's major tourist attraction is the world-famous Seven Mile Beach on which most of the island's hotels and resorts are located. SMB was recently named the "Caribbean's Best Beach" by Caribbean Travel and Life Magazine and is regarded by many as one of the best beaches in the world.
The Cayman Islands are also world famous as a Scuba Diving destination because of their crystal-clear waters and their proximity to the Cayman Wall. Cayman Brac and Little Cayman are also considered to be elite dive destinations. There are several snorkeling locations where tourists can swim with stingrays.
See also: Scuba Diving on the Cayman Islands
Financial services industry
The Cayman Islands financial services industry encompasses banking, mutual funds, captive insurance, vessel registration, companies and partnerships, trusts, structured finance and the Cayman Islands Stock Exchange. As of December 2005, just over 70,000 companies were incorporated on the Cayman Islands including 430 banking and trust companies, 720 captive insurance firms and more than 7,000 funds.
A recent report released by the International Monetary Fund (IMF) assessing supervision and regulation in the Cayman Islands' banking, insurance and securities industries, as well as its anti-money laundering regime, recognised the jurisdiction's comprehensive regulatory and compliance frameworks. "An extensive program of legislative, rule and guideline development has introduced an increasingly effective system of regulation, both formalising earlier practices and introducing enhanced procedures," noted IMF assessors. The report further stated that "the supervisory system benefits from a well-developed banking infrastructure with an internationally experienced and qualified workforce as well as experienced lawyers, accountants and auditors," adding that, "the overall compliance culture within Cayman is very strong, including the compliance culture related to AML [anti money-laundering] obligations...".