Cayman’s gross domestic product fell by 11.4% in the first six months of last year. The Economic and Statistics Office estimates the economy contracted by 7.8% during the full year 2020 and but projects economic activity will expand by 5.2% in 2021.
Following a 1.9% expansion in the first quarter, Cayman’s GDP dropped at an annualised rate of 18.7% in the second quarter of 2020.
The ESO’s semi-annual economic report shows that COVID-19-related lockdown measures and border closures impacted the hotels and restaurant sector the most (-52.3%), followed by construction (-19.7%), and wholesale and retail trade (-16.5%).
The financial sector – the largest contributor to GDP – decreased by an estimated 3.3% during the period.
Despite the sharp contraction of almost all sectors, health and social services is estimated to have expanded by 18.1% as spending and activities in the sector increased in preparation for the government’s pandemic-mitigation response. Producers of government services, which include the education sector, is estimated to have expanded by 9.3% for the period.
The number of work permits declined by almost 4,500 between the third quarter of 2019 (28,750) and the second quarter of 2020 (24,638).
The second half of last year is expected to show a broader-based recovery, with early indicators pointing to a jump in activity in construction, real estate and financial services.