Government aims to significantly increase its funding of Cayman Finance by matching the financial contributions member companies are making to the association that represents Cayman’s financial services industry.
Minister for Financial Services Tara Rivers announced government’s plans to pay Cayman Finance $750,000 per year beginning with the next budget year.
Speaking in the Legislative Assembly on Monday, Ms. Rivers said, “Countering negative campaigns as well as jurisdictional business development is a cost that is necessary.”
She argued that Cayman Finance provides valuable advice through its working groups during the various consultations on legislation proposed by her ministry.
“In addition, Cayman Finance’s efforts to inform international stakeholders of the robust regulatory regime that exists in the Cayman Islands and the value that we provide to the global economy have been very productive,” she said.
Cayman Finance’s events and stakeholder engagements in the U.S. and the U.K. have helped to dispel negative perceptions of Cayman as a jurisdiction.
“These efforts must be continuous and ongoing,” Ms. Rivers said.
Government’s funding of Cayman Finance has long been a contentious issue. In 2013, Gonzalo Jalles, the then-CEO of Cayman Finance, called for more government support, noting that competitor jurisdictions like Bermuda, Guernsey or Jersey have promotional bodies that are financially supported by government with annual budgets ranging from $1.3 million to $6.4 million.
Minister Rivers said, “Unfortunately, misinformation and bias can hurt our reputation as an international financial center where legitimate business is conducted. With active negative campaigns run on a regular basis, the work and messages of Cayman Finance should and are intended to support the ministry’s efforts in responding to such campaigns.
“Equally as important, Cayman Finance is a key vehicle for business development for the jurisdiction as a whole.”
The 254 percent increase in its financial contribution demonstrated government’s commitment to supporting the association and its intention to continue to work with Cayman Finance, she noted.
Minister Rivers also announced that government will work with Cayman Finance and other industry associations to develop a strategy for the next two years to protect the financial services industry and promote growth.
Cayman Finance responds to Paradise Papers
In the latest example of campaigns attacking the Cayman Islands as a financial center, Cayman Finance responded on Monday to the publication of the Paradise Papers.
Jude Scott, CEO of Cayman Finance, said, “Like other international financial centers, the Cayman Islands has had to get used to unfair and inaccurate reporting about our role in the global financial marketplace.
“However, we will not tolerate unfair attacks against our Queen, Elizabeth II, who maintains normal and legal investments in Cayman, a British Overseas Territory, a compliant and transparent jurisdiction that is part of her Dominion.”
He noted that a wide range of investors from pensioners to university students benefit from investments in Cayman.
“Individuals as well as institutions such as government and state pension plans, regular pension funds and university endowments invest together in Cayman funds to access investment opportunities from around the world in a neutral location,” Mr. Scott said.
He added, Cayman’s legal investments are no different than those that exist in London, New York, Frankfurt, Dublin, Luxembourg and Paris and they are just as transparently reported to tax authorities.
“Cayman investment and pension funds managed by U.K. managers help support thousands of legitimate and tax-paying jobs in the U.K. financial services industry, an important pillar of the U.K. economy,” Mr. Scott said.