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Published 9th March 2010, 9:27am

Remarks for the Premier, the Honourable W. McKeeva Bush OBE JP Delivered at the GAIM Ops Cayman Conference on Tuesday, 2 March 2010 in Grand Cayman

Thank you for that kind introduction.

It is encouraging to see almost two hundred companies represented here today. It certainly demonstrates your commitment to securing a firm position in the alternative investment landscape and speaks to your dedication of keeping abreast of the latest developments in the industry.

I am sure that yesterday’s sessions provided you with critical information on risk management, operational due diligence and compliance.

This morning, I wish to briefly inform you on measures that the Cayman Islands Government is taking to maintain and build on the quality of our financial services sector and our regimes that support this important industry.

Our overall goal for the future is to take the Cayman Islands financial services sector to another level and to do that, we are putting resources into looking at ways to stimulate growth in this industry, in ways that benefit market participants and our country.

I assure you that Government agencies are working diligently to ensure that Cayman meets international standards on governance, regulation and supervision. We continue to develop our legislative framework through upgrades and improvements to existing laws, facilitating ease of business and investment in Cayman.

One of the key features of our industry is that we have been able to respond to market conditions quickly and efficiently and the current global economic situation is providing several opportunities for us to determine how we can remain innovative and competitive in the global financial services marketplace.

The first step in our strategy was the creation of the Ministry of Finance, Tourism and Development, bringing together the talent, resources and policy initiatives from our two main economic sectors in way that seeks to create investment opportunities. And under our Ministry’s direction, we have quickly mobilized some key initiatives to bring strength and stability to our economy such as:

  • The recently announced immigration directives that will make it easier for financial services firms to attract and retain top talent, which will in turn help continue to drive business in that sector and keep the Cayman Islands at the forefront of the global financial markets
  • A stepped-up international investor outreach programme evidenced by the investor relations initiative that formed part of the November 2009 debt issue, during which our government, in partnership with the private sector, showcased the quality, stability and integrity of our jurisdiction and put down a marker to say that the Cayman Islands is open for new businesses and physical investment from markets such as London, New York, Singapore and Hong Kong; this was followed up with additional investor outreach in Dubai and Delhi in December 2009.

Over the past 10 years, the funds sector has been a significant driver of growth for the Cayman Islands financial services industry and for that, we are grateful to many of you in this room and around the world who have shown confidence in our funds sector by choosing Cayman. We want to further build on this investor confidence and commercial certainty by opening up opportunities for continued growth.

A fundamental tool that will assist us in achieving this mandate is the creation of the Department of Commerce and Investment. This department’s Investment Support Services Unit is tasked with facilitating the interest of foreign investors and working cohesively with relevant agencies to ensure that we meet and exceed investors’ expectations.

Similarly, we have created a National Investment Council that will also serve the interests of investors. The NIC will consist of members from the private and public sector who will spearhead our national investment strategy and decide on the most appropriate sectors for investment promotion based on our needs and capabilities. We are committed to making every investor’s experience as efficient as possible.

And rest assured these just represent the initial steps we are taking to make living, working and doing business in the Cayman Islands as easy and investor-friendly as possible.

There are many signs to show that the Cayman Islands economy is resilient and will continue to be stable. Consider the following:

The global financial markets gave us a resounding vote of confidence by making our November 2009 international bond offering the lowest ever yield by a Caribbean issuer in a U.S. dollar public bond transaction.

Looking forward over the next 3 to 4 years, our economy has attracted more than $3 billion in infrastructure and commercial developments such as new port facilities for cargo and cruise ships, to world class developments such as Camana Bay; Dragon Bay, a significant new phase of the Ritz-Carlton Grand Cayman, and Cricket Square, among other projects.

Additionally, several new private sector interests from around the world are showing interest in the Cayman Islands. We saw this first hand as part of our recent investment marketing efforts across the U.S., Europe, Asia and the Middle East where I personally met with hundreds of current and potential investors.

So, our relationships with international counterparts are strengthening. Our international cooperation regime is better than ever before. We have also demonstrated our commitment to improving channels of communication in the global tax arena by signing 14 tax information exchange agreements, and we are in the process of negotiating and advancing 15 others.

Ladies and gentlemen, we can all appreciate that these accomplishments don’t just happen but are the result of hard work and constant diligence on the part of Government. More often than not, the more we do to engage our stakeholders, the more work there is to be done.

I recognise that the last two years have presented difficult challenges for us. Across all sectors, we are seeing adverse effects in the aftermath of the financial meltdown – the alternative investment market is no different.

The Cayman Islands Monetary Authority reports a slight fluctuation in mutual funds registrations during 2009; however, as the year progressed, the number of licensed investments and securities showed slight growth.

The Monetary Authority’s admittance to IOSCO in June 2009 as a full member, in addition to CIMA’s active participation in AIMA and other international standard setting bodies, is of vital importance to us in terms of shaping the future development of the industry.

More importantly, we recognise that global trends including the increased use of hedge funds, private equity and structured finance as means to raise and distribute capital, has placed Cayman and our service providers at the centre of this fast paced industry. The Cayman Islands is home to more than 9,500 funds and remains one of the world’s leading offshore hedge fund domiciles, capturing upwards of 80 per cent of the world’s hedge funds.

However, we recognise that our success as a jurisdiction can only be made possible through the strong partnership that exists between government and the private sector. Cayman’s strength lies in the cooperation between these two entities which have one common goal: to continue to secure our position and exceed expectations in the financial services landscape.

Association partners across all sectors work together to educate and inform local and international audiences of the latest developments within the industry. They also provide and share relevant research, knowledge and industry expertise which in turn help to inform Government strategies and directives where necessary.

I cannot emphasise the importance of this indispensable relationship. I wish to thank all of our industry partners who have worked effortlessly to position our financial services sector as a global success. This partnership is in full force, and we are currently working with financial services firms to address challenges and issues facing the sector.

Similar to many other jurisdictions, our efforts are focused on creating and preserving valuable resources which enable our main industries to flourish. The Cayman Islands has been branded as having a world class financial services sector – a reputation that we pride ourselves in achieving over the last four decades.

Undoubtedly, there is much more to be done. I believe that with the right balance of public/private sector cohesiveness, exceptional product offerings, first-rate customer service and an enhanced investor relations environment, the Cayman Islands will remain a leader in financial services for many years to come.

Thank you, and do enjoy the rest of your conference.

 

For more information, please contact the Financial Services Secretariat at (345) 945-5819 or via email at financepr@gov.ky.