The Islands’ Current Account Deficit Reached $831.6 Million in 2017
The Cayman Islands’ Balance of Payments (BOP) and International Investment Position (IIP) Report 2017 shows the statistical summaries of the economic and financial transactions between residents of the Cayman Islands and the rest of the world. The statistics are generated from survey returns of local businesses and other organizations as well as data provided by the Cayman Islands Monetary Authority (CIMA).
As in previous years, the BOP shows that in 2017, the total payments of residents to non-residents exceeded receipts, thus resulting in a current account deficit of $831.6 million, 36.4 percent higher compared to 2016. The current account deficit in 2017 is equivalent to 19.4 percent of GDP, as compared to 14.9 percent in 2016.
The current account deficit in 2017 was driven primarily by increases in interest payments to non-residents for investments, higher workers remittances outflows, and increased importation of goods. The large deficits from these transactions were partially outweighed by surpluses from financial services, travel and other business services (mainly legal and accounting services).
The IIP shows the value and composition of foreign assets and liabilities of residents (mainly financial corporations and a few non-financial corporations) at the end of the year. The latter represents the total investments of non-residents in the Cayman Islands.
At the end of 2017, the Cayman Islands residents’ total financial investments abroad was estimated at CI$128.4 billion. These consisted of direct investments ($20.4 billion); portfolio investment ($32.7 billion); financial derivatives ($4.6 billion); currencies, loans, deposits and other investments ($70.6 billion); and reserve assets ($0.12 billion).