The Cayman Islands’ economy in 2015 is not growing as fast as economists had predicted, according to government figures released last week.
Government also announced final gross domestic product figures for 2014, adjusting those numbers up now that all the data is in.
Based on data collected from local businesses, the gross domestic product estimate for 2014 shows that the local economy expanded by 2.4 percent, exceeding the 2.1 percent early estimate released in July. Sixteen of the country’s 18 industries, including hotels and restaurants, posted improved economic performance in 2014.
With the growth in 2014, the country’s GDP per capita reached $48,642, higher by 3.3 percent when compared to 2013.
While economists previously predicted the gross domestic product for the Cayman Islands would grow by 2.1 percent in 2015, the forecasted growth rate has now been adjusted to 1.7 percent for the year, according to the Cayman Islands’ Semi-Annual Economic Report for 2015.
The new adjustment covers the growth rate for the first half of the year. Although the GDP for the Cayman Islands grew by an estimated 1.6 percent in the first six months of 2015, economic performance for that time period was lower than the 2.2 percent growth for the same period a year ago.
“While unplanned, the moderation in growth so far in 2015 is not totally unexpected,” Finance Ministry Marco Archer said in a press release. “This is consistent with the International Monetary Fund’s downscaling of global and U.S. growth for 2015 which impacted key local sectors such as hotels and restaurants.”
In October, the International Monetary Fund adjusted the global growth rate for 2015 to 3.1 percent, down from its original outlook of 3.5 percent. The forecast for the U.S. growth rate was also downgraded from 3.1 percent to 2.6 percent.
The slowdown of growth for hotels and restaurants in the first half of 2015, due in large part to slowing growth for stay-over and cruise arrivals, was accompanied by slowdowns in other sectors, as well.
Declines in economic activity were seen by the wholesale and retail trade, government services, and transport, storage and communication sectors.
Some sectors did see improved economic performance in the first half of the year. Expanding sectors included the real estate, renting and business services, construction, other services, financing and insurance services, and agricultural and fishing, mining, quarrying and manufacturing.
Another bright spot in the Semi-Annual Economic Report was that the central government’s overall fiscal balance improved to a surplus of $115.1 million in the first six months of 2015 as compared to a surplus of $100.2 million a year ago.
Mr. Archer stated he was “pleased to note the fiscal performance continued to improve” in 2015.
“The central government’s overall fiscal surplus at $115.1 million is 14.8 percent higher than a year earlier while the central government’s outstanding debt amounting to $530.3 million is 4.9 percent lower from the same period a year ago,” Mr. Archer said.