Report: Finance industry still king

An annual report on Cayman’s gross
domestic product reveals that the financial services industry contributed
nearly half of the country’s GDP in 2009, despite a general decline in business
locally and worldwide.

Gross domestic product or gross
domestic income is the amount of goods and services produced in a year in a
country. The total GDP is the total value of all the goods and services made
within the borders of the country for the year.

“Despite the decline of economic
activity in the financial and insurance services in 2009, its contribution to
[gross domestic product] remained the highest at 42.9 per cent,” read the
report issued in mid-December by the government Economic and Statistics Office.

That huge contribution to Cayman’s
economy came despite what economists said was a 14.4 per cent drop in financial
and insurance services for the year compared to 2008.

Cayman’s overall GDP fell in real
terms by about 7 per cent when comparing 2009 with 2008, according to the
statistics office.

The other major industries or
business sectors making up the largest share of Cayman’s gross domestic product
included: professional and technical activities (mainly legal and accounting
jobs) at 13.3 per cent; wholesale and retail trade (8.9 per cent); real estate
activities (8.7 per cent); government (7.5 per cent); information and
communications activities (5 per cent); and hotel and restaurant businesses (5
per cent).

Several of those industries, in
addition to the financial services industry, saw a significant decrease in
activity, according to the report.

Those included a projected 29 per
cent drop in GDP contribution recorded from the construction industry.
Wholesale and retail GDP fell about 11.5 per cent between 2008 and 2009; and
hotels and restaurants fell about 10 per cent, according to the statistics
report.

Several local industries recorded
some growth in their contributions to the country’s overall economy, including
the electricity industry, waste management, information and communication and
legal and accounting activities.

Per capita gross domestic product
in the Cayman Islands for 2009 was estimated at $46,294.

GDP figures produced by the
government are important to investors and creditors who use them to determine
the creditworthiness of a jurisdiction.

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