Cayman’s economy shows partial recovery from Covid-19 slump in 2021
Pent-up demand and robust growth in financial services led to an expansion in domestic output for the year 2021, with real Gross Domestic Product (GDP) estimated to have expanded by 1.8 percent. This was the highlight of The Cayman Islands’ Annual Economic Report 2021 released by the Economics and Statistics Office (ESO).
Strong demand for consumer goods and real estate propelled growth in supporting sectors. Actual indicators point to accelerated growth in construction (7.9%), real estate activities (6.3%) and wholesale & retail trade (5.4%). The strong local demand was matched by strong international demand. Advanced economies expanded by 5.2 percent, with the US economy growing by 5.7 percent. The higher income levels amongst the Cayman Islands’ main trading partners led to a rise in demand for the Islands’ key services. The finance and insurance sector expanded by 1.8 percent, while business services which comprise legal and accounting services, rose by 2.8 percent.
Despite strong local and international demand, the closure of the Islands’ ports for most of the year led to a decline in tourism and travel-related services. The hotels and restaurants sector declined by 21.4 percent, while transport and communication fell by 13.0 percent.
At the end of 2021, the Central Government’s Operating Deficit (i.e. its Operating Revenues [of $961.1 million] less its Operating Expenditures [of $979.2 million]) stood at $18.1 million but, when Capital Expenditures and Capital Investments are taken into account, total Expenditures and Investments exceeded Operating Revenues by $117.2 million.
The government reduced its outstanding debt to $222.7 million as at the end of 2021 from $248.6 million as at the end 2020.