Published 29th January 2021, 3:9pm
My thanks, President Mike, for that introduction and a very good afternoon to all of you.
I thank Past President Woody Foster, the Chamber Council, member businesses and Wil and his team for their important contributions throughout the past year, particularly work done with Government on issues of national importance.
This HAS been an extraordinary year for all of us; for government, for businesses and for the Chamber. In such testing times, you really see the mettle in those with whom you work. On behalf of Government, I believe we have not only seen the mettle of the leadership of the Chamber and its members, but also the examples you have given to remind us that business is not just about profit, but also people.
It was the leadership executive as well as leaders across several business sectors with whom we first sat down to map out what would likely happen as we moved to lockdown.
From the first, very difficult decisions the government had to make last March in the face of the COVID-19 crisis, the support of the Chamber has been absolutely invaluable, particularly in assisting the people of our Islands as much as possible.
The willingness of Wil and his team to get messages and advice out to members in a timely manner and then the willingness of the business community to stick to the rules has been absolutely vital in achieving what has been a singular public health success story for these Islands. I want to thank everyone in this room, and the wider community, for the part you have played in that success. I know the very real challenges that these times have created for you and yet your resolve and support have been tremendous.
It is gratifying, but unsurprising to me, that business has responded in the way that it has over the last year. It is unsurprising because it is the result of the confidence and trust that has grown between the government and the business community over the last eight years my two governments have been in office.
If the past year seems like a lifetime ago, it is perhaps difficult to remember what things were like when my first Progressives-led Administration took office in May 2013. But for those whose memory might be a little hazy, let me remind you.
The Cayman economy was on its knees. Any recovery from the crisis caused by the financial crash of 2008-2010 was at best faltering. Our tourism numbers were at the lowest in over a decade. Small businesses were struggling while the construction and development sectors were in the doldrums. The economy was straining to grow at a little over 1 per cent. Caymanian unemployment was high and hard-working families, through no fault of their own, were facing real hardship. Government and the national finances were in disarray; and, unsurprisingly, the private sector lacked the confidence to make crucial investments that would help spur recovery.
Through that first term, we worked hard to turn things around. In my view, our biggest achievement was to bring stable and effective governance back to these Islands. The most obvious expression of that was the transformation of the nation’s finances. We brought the government finances into compliance with the financial tests set out in the Public Management and Finance Law. And we controlled government spending to bring back consistent budget surpluses, while delivering on our pledge to repay debt and not to raise taxes or fees. In fact, we reduced a number of those fees, bringing relief both to businesses and hard-pressed families. We invested in capital projects to improve national infrastructure but we did so using existing revenue streams. In short, over the two consecutive terms in which I have been Premier, Cayman has gone from a financial basket case to being a case study in effective financial management and good governance.
As I don’t need to tell you, business confidence was restored and investment started to flow again. Not only did our tourism numbers begin to improve, but significant financial investment came from the development sector. Investment also came through our continued support of the development of Health City and the influx of new ventures attracted to the benefits of our Special Enterprise Zones.
More and more Caymanians were confident enough to start their own new businesses while existing businesses invested for growth. Unemployment fell significantly as more Caymanians found employment in our flourishing private sector.
That is the fuel of Cayman’s economy and the result was strong sustainable levels of growth throughout the first six and a half years of this Government’s two terms, culminating in 3.8 per cent growth recorded for 2019 and a further 1.9 per cent rise in GDP for the first quarter of 2020.
Looking across our two terms, by 2019 we had a buoyant Cayman economy that was the envy of the region. Our growth averaged over 3 per cent in the previous five years, Caymanian unemployment was below 5 per cent and jobs were continuing to be created for Caymanians. Our tourism had grown to record numbers while the financial services business activity grew at almost 4 per cent on average. Our development sector was flourishing and in 2019 alone nearly 750 projects were approved with a combined total value of more than $890 million.
That is a track record of success that I am proud of, that my Government is proud of and that all of Cayman can be proud of.
At the start of 2020, with just over a year to go until the next election, we were all working hard to get important projects and initiatives over the line and to continue to build Cayman’s success story.
Even at that time though, it was becoming clear that storm clouds were gathering. Those of you who were at the Cayman Economic Outlook Conference in early March last year will have heard me warn that spread of a new coronavirus, COVID-19, could have potentially devastating effects on Cayman if it escalated internationally. My Government was hoping for the best, but hope is no strategy and so we had begun preparations back in January for the possibility of the virus reaching our shores.
By the end of March the virus was here and we had community spread. We made the decisions we had to in order to give the country the space it needed to keep the virus at bay.
I believe that we took the correct decisions.
In the Chamber’s October response to the Cayman Islands Government Economic Assessment and Stimulus Plan, the introduction said, and I quote, “We believe the Government has struck the right balance between safety and protecting our economy. This has resulted in an enhanced image of the Cayman Islands as one of the safest countries in the world”. Well of course I could not agree with you more!
But as welcome as that endorsement is, I do understand that behind it lies real concerns for you in the business community.
I know the impact of COVID-19 has had far-reaching ramifications to businesses and the economy. However, in the longer term, businesses and the economy would have been hit even harder if we had vacillated between repeated phases of lockdown and opening up. The experience in the UK and elsewhere has demonstrated that the costs to business of preparing each time the economy opens up, only to have to again close, offsets any financial gains. And the impact on people’s health has been nothing short of catastrophic.
While times remain challenging here, particularly for those reliant on tourism for their income, it is not a coincidence that we are now able to enjoy, if not ‘normality’, then at least a lot more freedoms than in most of the rest of the Western world. The recent announcement that up to 1,000 people can now gather freely outdoors in Cayman stands in marked contrast to the strict lock-downs in the UK and much of Europe.
It will be some time before we know the full impact of the virus on Cayman’s economy, but we do not need to see detailed statistics to know how hard it has been. But this Government has not just stood by and watched as those things have happened. From the very outset we acted to mitigate the potential impact of the crisis on Caymanian businesses and families.
The government responded immediately to the crisis facing our tourism industry, instituting a monthly stipend of $1,000 for tourism workers who have been displaced. In the coming days we will make announcements on further assistance for those impacted in the tourism sector. In addition, we have funded stipends to those on permanent financial assistance and a one-time stipend to families receiving food vouchers.
The Government-funded isolation facility and home isolation programme has aided with compliance and eased any financial issues for those needing to isolate.
We have provided laptops for children so they can learn remotely to ensure that we can continue to drive educational improvement, even in these circumstances.
In addition to the creation of the Small Business Centre, our grant scheme has provided direct financial support to businesses. I thank Minister Hew for his leadership and the public can look forward to further announcements from him in the coming days regarding assistance to small businesses.
I also want to commend the five local banks that worked with Minister McTaggart to develop a Government Guaranteed Loan scheme that assists eligible Caymanian businesses obtain the necessary bank financing – with government backing – to allow them to remain in business, serve their clients and keep staff employed.
We understand fully that the country will not prosper if business does not do well and that business cannot prosper if the country does not do well. Keeping what are essentially viable businesses afloat through this period means that our economy can recover more quickly in the future.
While this crisis has not yet passed, there is every reason to be optimistic for our future. The roll out of the vaccine is going well here and once again I applaud our health professionals.
I would also like to again thank the UK Government and the Governor and his office for ensuring that British subjects in the British Overseas Territories have not been forgotten as the UK rolls out its vaccine programme.
Internationally the vaccines are providing hope for respite in this crisis, including the United States; by far still Cayman’s biggest source of tourism revenue.
So, if there are grounds for optimism, what should we expect for the future? Well, first of all, the successful roll out of mass vaccination programmes offers the prospect that we can now think positively but cautiously about re-opening Cayman. Additionally, provided that enough people take the vaccination, we can be confident that our population will have a great deal of protection against COVID-19 disease and that we should not see the ravages that have unfortunately affected many other places – this is a good news issue, and one we should be grateful for.
However, I must stress two things. Firstly changing circumstances mean that of necessity today’s plans must be flexible. With the arrival of new COVID-19 strains and concerns over how much protection the current vaccines will offer against these new variants, it has become increasingly challenging to develop a firm timetable to get the Cayman tourism economy up and running again. Unfortunately like some countries in the region, which opened their borders early on, have seen such as Bermuda and Barbados the risks of opening too soon may have negative consequences for the health of both the people and the economy if community spread restarts, forcing renewed restrictions and lockdowns.
Just yesterday Barbados announced that with effect from next Wednesday it will re-enter lockdown with curfew following detection of community spread of the new variant where even most construction will be asked to stop work.
Circumstances are changing so quickly that it is unwise to think we can predict how things will be even just weeks into the future. However, we must look ahead and try to chart the most appropriate path forward. I will talk shortly about the general shape of Government’s thinking in that respect but before I do I want to make my second point about why our plans remain necessarily broad at this point.
That second reason is that Cayman will continue to pay proper regard to public health in all its decision-making. We have come too far and we have borne too much to risk allowing the virus, in whatever form it takes, to re-enter our community and to rip across our Islands.
Government must continue as best we can to balance the risks and make well-informed judgements about the future pace of re-opening.
Given concerns with new strains detected in travelers coming to Cayman, we must reassess. My Caucus and Cabinet are awaiting updated information on our current vaccination programme and the situation with COVID-19, including the new strains, and the impact these have on plans to reopen the border. Whilst we need to consider how best to further open up, any decisions taken will be done with safety and public health as a major consideration.
We remain committed to finding a way to re-opening safely despite the new challenges that seem to be changing weekly. And so we remain hopeful to be in a position to enjoy an improved stay over tourism high season. This will not be ‘business as usual’ but there is a real prospect that it could be ‘business as near normal as is possible as we close 2021 and enter 2022.’
I am less clear, I have to say, on prospects for the cruise tourism sector. However, as I have said, it is doubtful to the extreme that we will see cruise tourism start this year based on the challenges that I believe the cruise sector will be facing.
There are still challenges ahead for Cayman but just as I am confident that we will see the restart of our tourism industry, I am even more confident in our wider economy. The factors that allowed economist Marla Dukharan to call Cayman ‘the strongest economy in the Caribbean’ are still in place.
Our Financial Services Industry, so important to Cayman’s prosperity, is in good health. The success of the legislative and operational reforms put in place and the engagement by Government and the Financial Services Industry have seen Cayman’s name removed from the EU’s so-called blacklist. That is a signature achievement. But as we have seen in some headlines emanating from the EU, we still face challenges. As we have always done, we will respond to any challenges while continuing to demonstrate our transparency and our willingness to comply with international regulatory standards.
Our construction industry continues to do well and the flow of projects coming through the planning process is testament to on-going investor confidence in these Islands and in this Government. The best example of that is the announcement in December by Aster DM Healthcare that it will invest US$350 Million in medical facilities in these Islands.
We are also seeing more confidence from small and micro-sized businesses. More are setting up and more are bringing forward plans for growth.
Solid prospects for Cayman’s economy but, as you are aware, when those prospects are so reliant on confidence, then those prospects are inherently fragile.
Over nearly eight years, this government has worked tirelessly to win and then maintain business confidence. As you would expect, I make the case here today for the return of a third Progressives-led government. With so much external uncertainty and risk, and with so much left to do to secure Cayman’s return to prosperity while keeping us safe, I believe that case to be overwhelming.
First, this government has shown that we can deliver on the commitments we make.
In education, we have implemented a challenging new curriculum and promoted improvements in the quality of teaching that are driving higher educational standards, creating the workforces your businesses need for the future. The new John Gray High School is under construction and the first phase will be ready for the next academic year with the full school open the following academic year.
On the environment we have delivered a massive extension to the Marine Parks programme, designated new environmentally protected sites, and safeguarded more public open space for people to enjoy. The George Town landfill is being capped and we will shortly sign the contract to build a waste-to-energy plant that will end Cayman’s reliance on unsustainable landfilling.
The new Customs and Border Control Service is protecting our borders from external threats while the new Coastguard helps keep our seas safer. We have provided support and extra resources to the Royal Cayman Islands Police Service to boost neighbourhood policing and keep our communities safer while tackling future threats from cybercrime. Two new fully-equipped helicopters give Cayman an emergency response capability unparalleled in a nation of our size. Fire fighters are better trained and have access to better equipment. And the launch of the Cayman Islands Regiment has enhanced our ability to aid in national disasters at home and regionally.
The long term mental health facility will open this year and enable Caymanians to access state-of-the-art care here on Island, closer to their families. This will achieve better health outcomes for those suffering from mental illnesses and reduce costs to government. The opening of Habakkuk House finally separates the care for children from that for adults with special needs.
We have continued to support people and businesses by investing in our national infrastructure. The new airport terminal has opened and the runway improvements have been completed as we continue to deliver the priorities set out in the airport’s master plan.
The road network has been enhanced at key sections across Grand Cayman and this year we have brought forward the works to extend the East-West Arterial Road in order to solve growing peak-hour congestion problems.
The Plan Cayman process has kick-started our approach to effective national land-use planning and the National Energy Policy is being implemented.
Seafarers, veterans and those in need in our community have received significant increases in their monthly stipends. Dozens of new affordable homes have been built and our stamp duty reductions to first time Caymanian Home owners have helped many young Caymanian families achieve their dream of home ownership.
During this term, we achieved significant Constitutional advancements that provided needed protections for our Islands and gave Caymanians greater control over our own affairs, created an independent Parliament, finally enacted the long overdue Legal Services Act and implemented the Standards in Public Life Law.
The second key plank in the Progressives case is that we have ably demonstrated the strong and certain leadership necessary to steer the country in good times and bad. But effective political leadership also means being willing to work with others. The strength and stability of the Unity Government reflects the willingness of each of us involved to always put the country’s interest first. Never has the strength of leadership and unity of purpose been more important than in the current crisis.
Every member of Cabinet has stepped up and made sure that their Ministry is delivering the priority actions that the country needs at this time.
As we look to the future, that certainty of strong and effective leadership remains essential if Cayman is to emerge successfully from this crisis and restore prosperity to all of our people. As I said in the House back in October, I can think of no one better suited to the task that lies ahead for our next Premier than Roy McTaggart.
His stewardship of the nation’s finances has been integral to the achievements of my government that I spoke about just now, but it also created the resilience that has allowed us to cope with the crisis so positively. Throughout his time in public office, Roy has drawn on his long and successful private sector career to inject business discipline into public service. He has done so with an assured and patient style that has won him admirers inside and outside of government. I have no doubt that he has the will, the determination and the credibility necessary to take our country forward. I feel confident that the Progressives Party, of which he is a member, will choose him at the Party Conference as the Progressives’ new political leader and I equally have confidence that not only will he be returned by the good people of George Town East, but that his colleagues will support his leadership as Premier.
As I close, and you will hear more of this as the election season opens, only the Progressives and those aligned with us have the kind of coherent vision and record of team work that this country needs for its future.
The right vision, put forward by leaders who have the track record of delivery to ensure that the vision gets implemented.
Not only do our achievements stand up on their own account, our case stands in marked contrast to the pronouncements you will hear from others. Now is not the time to gamble Cayman’s future. Not on those who currently sit on the opposition benches yet remain unclear on how to get things done in government and unable to work effectively together even on the relatively easy task of opposition.
Also we cannot gamble on the utopian promises of untried, inexperienced want to be politicians who cannot tell you who they will choose to lead this county and with whom they will form a government.
Finally, I hope you will allow me one personal reflection before I close. There is an expression - “The trouble is, you think you have time.” How often do we think about doing something but put it off, only to find that either the chance slips by or that circumstances change? One of the blessings or curses of being a politician is that you soon learn how precious time is. Not just in Cayman but the world over, one’s ability to effect the change you fought hard to get elected to achieve is conditioned entirely by the pace at which things happen in large public service bureaucracies and bounded by four-yearly electoral cycles. Just as newly sworn in President Biden is no doubt already thinking, there is never enough time.
I had thought that, after 20 years serving my country - eight as its Premier - I might retire to my farm. But I cannot in good conscience do so. Not with the future so uncertain. As we recover from the virus, I still feel a deep-seated commitment to continue to do my part in delivering Cayman’s return to prosperity.
As I said just now, these times call for experienced and trusted leadership and as I also said, I have every confidence that as this country’s next Premier, Roy McTaggart, will provide that leadership. But as I also know, government is a team sport, and the new Premier, and his Deputy, will need experienced hands there to help and support him. I will be pleased following the elections in May to offer to serve my country in whatever capacity the new Premier sees fit. Indeed he deserves the support and the allegiance of all experienced heads on the Government bench when the new Government is formed following the May elections.
These are extraordinary times and they call for extraordinary efforts from all of us. It is not a time for learning on the job.
Lastly, when I visit the Chamber website, three words jump out in big capital letters as the mission that you are pursuing:
SUPPORT, PROMOTE, COLLABORATE.
Those, I believe, should be watchwords not just for the Cayman Islands Chamber of Commerce but for the way in which government, the business community and civil society need to come together for the years ahead as we restore Cayman to prosperity.
I stand ready to do my part. I call on everyone in this room to do the same. Let us support each other; not seek to undermine each other’s efforts. Let us collaborate to share our understanding and develop solutions to the challenges facing us in a spirit of true partnership. Finally, let us all promote these Islands as a first class destination to live, work, visit and do business.
Cayman has a bright and positive future that is ours to shape. It will be better and it will be stronger if we shape it together.
I thank you once again for the powerful support that the Chamber has given not just during the recent crisis but over the last seven and a half years. I look forward to continuing to work with you in the years ahead.