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Thanks to construction and the financial services sectors, 1997 was another year of solid economic performance for the Cayman Islands, says the Caribbean Development Bank (CDB). GDP (gross domestic product) increased by an estimated 6%:

. The Government continued its efforts to develop the financial sector by establishing the Cayman Islands Monetary Authority (CIMA) and the Cayman Islands Stock Exchange (CISE). It increased a number of fees, duties and licenses and introduced some new ones, but a significant rise in expenditure offset the impact of the resulting higher revenue and caused a decline in the current account surplus in 1997;

. The performance of the tourism sector was mixed in 1997, with stayover arrivals growing by 2.2% to 314,989 while cruise ship arrivals increased by 12.1% to 683,599. The performance of stayover arrivals reflected sluggish growth -- by 1.5% to 231.835 -- in arrivals from the U.S., which accounted for 73.6% of total stayover arrivals;

. The launch of a new charter service out of Canada contributed to an increase of 15.6% in Canadian stayover arrivals to 14,207 and these accounted for 4.5% of total arrivals. The value of construction planning approvals, which usually reflects construction activity with a three-month lag, increased by 50.3% during the first three quarters of 1997;

. In October, the CIMA closed one bank after some irregularities were discovered in its loan portfolio. The number of captive insurance companies increased from 418 to 443. Mutual fund registrations continued to grow, from 1,199 to 1,637, and of these, 20 were listed on the CISE;

. The performance of the agriculture sector was mixed. Drought conditions in the first half of the year adversely affected the output of food crops. Livestock production improved as a result of the ongoing efforts to enhance livestock quality through the introduction of appropriate breeds.

. Plans have already been submitted and approved for the construction of a 373-room hotel which will be associated with a well-known international hotel chain. The Government's medium-term capital program includes the continuation of the George Town Hospital, the construction of a new road, a civic center and cricket facility, and the upgrading of a number of schools and existing roads. Tourism expenditure is expected to increase as a result of the pursuit of a more targeted marketing plan and an increase in airlift, the CDB stated.
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Publication:Caribbean Update
Article Type:Article
Geographic Code:5CAYM
Date:Jul 1, 1998

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