ESTABLISHED 1965 www.caymancompass.com – 50 CENTS – Wednesday January 13, 2016 High of 87 Low of 75 Slight with wave heights of 1 to 3 feet. JAN UA R Y 2 0 1 6 • W WW . CA YJOU R N AL. C OM 1 5 9 16 predictions for 2016-’21 VIKRAM MANSHARAMANI Last year was a roller coaster for analysts of global economics and politics. Terrorist tragedies from the U.S. and France to Nigeria and Iraq shocked us, Nepal suffered a devastating earthquake, and Volkswagen’s massive fraud surfaced. A million migrants fl owed into Europe, while a nuclear deal was reached with Iran. The U.S. and Cuba made progress in restoring relations and Donald Trump grabbed global headlines. Nations reached a new set of cli- mate accords in Paris, and the Islamic State persisted. China’s slowdown con- tinued, it ended its one-child policy, and energy and industrial commod-ity prices stayed lower than expected. And of course, the Fed began its effort to normalize interest rates. How can we possibly navigate the rad- ical uncertainty presented by this chaotic tangle of events and trends? Some use a Magic 8 ball, while others turn to Ouija boards. I’m more conventional. Rather than try to predict what will happen in the coming year – to me, a fool’s errand due to the short time-horizon – I try to look through the noise by analyzing structural signals and making predictions over a fi ve-year window. Last year, I made 15 predictions for 2015- 2020. But as noted by the late Yogi Berra, “The future ain’t what it used to be!” So I’ve incorporated feedback from last year into my predictions for the next fi ve years. As noted by the late Yogi Berra, “The future ain’t what it used to be!” So I’ve incorporated feedback from last year into my predictions for the next ve years. Major changes to Cayman’s transparency regime in 2016 But no central register of benefi cial ownership, government says. MICHAEL KLEIN Cayman’s much-debated and at times deemed controversial Confi dential Rela-tionships Preservation Law will see major changes and could be replaced altogether this year. In addition, government proposes a technology- based centralized platform to access information about the benefi cial owners of companies and other entities registered by service providers in the Cay- man Islands, according to Wayne Panton, minister of Financial Services. The minister said Cayman is not forced in con- nection with ongoing transparency initiatives to change the Confi dential Relationship Preservation Law, which criminalizes the unlawful release of pri- vate fi nancial information by service providers.“However, we have considered over a period of time whether the law itself is one which is nec- essary. It has attracted some unfortunate atten- tion,” he noted. “We are very likely to make some changes, either replacing the law entirely or mak- ing some signifi cant changes.” The benefi cial ownership platform, in turn, is designed to meet the demands of U.K. Prime Min- ister David Cameron that the Overseas Territories set up centralized registers of benefi cial ownership to provide U.K. tax authorities and law enforcement with direct access to this information. The U.K. government considers transparency of the owners and ultimate benefi ciaries of corporate vehicles an important element in the fi ght against corruption and fi nancial crime. At a Joint Ministerial Council Meeting between U.K. and Overseas Territories government repre- sentatives in December 2015, Cayman and other offshore centers linked to the U.K. agreed that they would implement centralized benefi cial ownership registers or “similarly effective systems,” but that access to these systems would not have to be public. Up to that point, the Cayman Islands govern- ment had maintained that its existing system whereby service providers collect, update and maintain benefi cial ownership data was working well. A centralized register would throw up new security and privacy issues in addition to greater costs, it had argued. However, Cayman’s existing system, which re- lies on bilateral agreements and multilateral trea- ties governing the exchange of tax information and other data relevant to criminal investigations between the authorities of different countries, is arguably much slower than a centralized register that is accessible online would be. Centralized platform Minister Panton told journalists at a media round- table in December that Cayman is not going to have a central register, but instead is exploring a centralized platform that would enable government offi cials to access and interrogate the benefi cial ownership da- tabases of all fi nancial service providers in Cayman. “And we will be able to do it without the ser- vice provider being aware to address the con- cerns about tipping off,” he said. “They would of course have to sign off on that.” The system would be accessible from within the ministry’s Department of International Tax Cooper- ation and work in the exact opposite way the gen- eral registry operates by reaching out to fi nancial services companies and their systems rather than registrants submitting information to a registry. The minister claimed that Cayman’s system has far better information that is checked and updated than the U.K.’s own benefi cial ownership register, which is based on an “honor system,” and will come into effect in April. Unlike the British system, it would also prevent identity theft, he noted.Dax Basdeo, chief offi cer in the Financial Ser- vices ministry, confi rmed that government is work- ing toward an action plan which over the next six months will require changes to systems, policy and potentially legislation. “By the middle of [2016] we will have made great strides in terms of our standards and regula- tory framework.” Yet the technical issues of access-ing benefi cial ownership information maintained by service providers from a centralized platform will take much longer to resolve, he said. The relevant deadline for the centralized plat-form would be in line with the implementation of EU Fourth Anti-Money Laundering Directive, which will see the creation of benefi cial ownership regis- tries across the European Union by the end of 2017.Talks with the private sector have been ongoing for months, and “in principle, the private sector is OK with the idea,” Panton said, but he acknowledged that the necessary technology does not yet exist. The National Crime Agency and the Serious Fraud Offi ce gave no indication that there was a problem with Cayman’s system in the approximately 10 investigations during the past Vikram Mansharamani THIS ISSUE: SPECIAL REPORT FOCUS ON THE FUTURE 2016 >>PAGE 13 BUSINESS Board Apprentice launches in Cayman Effort under way to increase diversity >>PAGE 4 FINANCIAL SERVICES Financial services need a strategy Two recent threats to industry outlined >>PAGE 4 GLOBAL ECONOMY Required reading For an age of global economic uncertainty >>PAGE 11 PAGE 13 SPECIAL REPORT January 2016 PLEASE TURN TO PAGE 9 » PLEASE TURN TO PAGE 8 » THE cAymAn ISLAnDS journAL Major changes to Cayman’s transparency regime in 2016 Editorial | pagE 4 HealtH City: 2016 looks like a groWtH year CarePay trial Judge orders ‘not guilty’ verdict for Watson co-defendant Brent Fuller bfuller@pinnaclemedialtd.om A Cayman Islands Grand Court judge or- dered a verdict of not guilty Tuesday against Canover Watson’s former personal assistant on a charge of transferring criminal property. The order came after submissions by Miriam Rodriguez’s attorney that she had no case to an- swer from the prosecution in the CarePay trial. Ms. Rodriguez, 54, whose name came up only a few times during the trial, which has been under way for several weeks, is now free to go and is no longer required to attend court proceedings. The no case submission was made after the prosecution completed its case on Monday. Shortly after the judge announced his de- cision, Watson embraced Ms. Rodriguez, who shed a few tears and later told the Cayman Compass she was “not surprised” by the ver- dict. She declined to make a further statement by press time Tuesday and went back to ob- serve the trial proceedings. Judge Michael Mettyear informed jurors Tuesday that he did not believe a properly directed jury could possibly have returned a guilty verdict against Ms. Rodriguez. Justice Mettyear said that while some of her behavior expansion plans ahead for Health City tad stoner, James WHittaker tstoner@pinnaclemedialtd.com, jwhittaker@pinnaclemedialtd.com Health City Cayman Islands will invest $25 million in infrastructure in 2016, and as much as another $100 million in 2017 and 2018, all drawn from private sources. The investments will come from Health City and Health City Development, ex- panding hospital facilities and launching a series of commercial enterprises, including staff housing, a shopping plaza, design work on a 185-room hotel and a marketing plan for a medical school. Shomari Scott, marketing director for Health City, said the $25 million was a “rough order of magnitude” and, while un- able to itemize expenses for each phase of the giant project, listed the elements. “The challenge Health City will face is keeping up with the increased demand in areas that we originally didn’t anticipate,” he said. “This is a good challenge to have, so we are properly planning and streamlining operations to offer the best service possible.” He offered the example of outpatient services, “consultations, etc.,” saying unex- pected demand required the hospital “to get as efficient as possible and still keep a high level of customer service.” Outpatient expansion will add 6,000 square feet, a 75 percent addition to the present facility, Mr. Scott said, “to provide for modalities we have added.” RobbeR punches 77-yeaR-old Rum point touRist in face CHarles dunCan cduncan@pinnaclemedialtd.com A man armed with a knife robbed three tourists while they were sitting on their back deck in Rum Point on Monday evening, police reported. The robber punched a 77-year-old man in the face before making off with cash, jewelry and electronics. According to police, a man approached the three, all from Kentucky, U.S., from the beach. He stole “a substantial amount of CI and US cash, jewelry, one iPad, three cellphones” and a watch, police said, before escaping back along the beach. The victims, a man and wife, 77 and 76, and another woman, 61, have been on vaca- tion in Cayman since Dec. 12. An ambulance took the man to the Cayman Islands Hospital where he was treated for minor injuries to his face and eye and released, police said. The two women were not hurt. The suspect is described as 6 feet tall, well built and with a dark complexion, according to the Royal Cayman Islands Police Service. In response to the incident, Director of Tourism Rosa Harris said in an email Tuesday, “This unfortunate incident is contrary to the usual Caymankind experience of our valued guests, as the Cayman Islands has a reputation for being a safe, family-friendly destination.” The Department of Tourism, she noted, “will Health City Cayman islands opened in February 2014. - photo: taneos Ramsay PLEASE TURN TO PAGE 8 » PLEASE TURN TO PAGE 8 » PLEASE TURN TO PAGE 8 » Miriam rodriguez reacts to the judge’s ruling tuesday afternoon after leaving the Grand Court. - photo: bRent fulleR2 LOCAL&REGIONAL Wednesday January 13, 2016 • Cayman Compass SATURDAY NIGHT: For your viewing pleasure, minors under the age of 18 will not be admitted to any film starting after 6pm, unless accompanied by their parent. © y x *Additional charges will apply per 3D ticket requested. - WEDNESDAY - THE HATEFUL EIGHT (R) 1:00 I 4:30 I 8:00 POINT BREAK 3D (PG13) 1:20 2D I 4:30 I 7:20 2D I 10:05 DADDY’S HOME (PG13) 12:30 I 3:00 I 6:30 I 9:40 JOY (PG13) 1:10 I 4:00 I 7:00 I 9:55 STAR WARS VII 3D (PG13) 12:40 2D I 3:40 I 6:45 2D I 9:50 ALVIN & THE CHIPMUNKS ROAD CHIP (PG) 1:15 I 3:40 I 7:10 I 9:30 Daily Matinees Every Day $8.00 Seniors, Mon-Fri Before 6pm Cayman Cinema@cbcinema6cbcinema6 640-FILM (640-3456) HAVANA (AP) – The lead ne- gotiator in the Cuban gov- ernment’s talks with the U.S. said in an interview pub- lished Tuesday that the American presidential cam- paign has added some un- certainty into how she views her country’s future relations with its northern neighbor. Josefina Vidal, director of the Cuban Foreign Ministry’s United States Division, told the official Cuban News Agency that if President Barack Obama hurries to dis- mantle existing U.S. sanctions on the island while he’s still in power, the ties will be less vulnerable after he leaves. “I will continue working with a high dose of mo- mentum and optimism,” she said. “But I’m beginning to feel a certain bit of realism as the electoral process in the United States approaches; we don’t know what’s going to happen.” There are “vari- ables outside of our control” in the presidential contest, she added. Supporters of rapproche- ment between the two coun- tries worry that a new pres- ident may try to roll back advances made in the U.S.- Cuba relationship under Obama’s leadership. Obama and Cuban President Raul Castro an- nounced on Dec. 17, 2014, that they would work toward normalization, a move that led to the reopening of em- bassies in each other’s capi- tals last year. Although only the U.S. Congress has the power to do away with the embargo against the island, Obama could do much more to en- sure that relations between the two countries are less vulnerable before the next November’s contest, the top Cuban diplomat said. Vidal said she had read many opinions by academics, intellectuals and even mem- bers of the U.S. Congress saying that the detente is “ir- reversible,” but she insisted that “it isn’t that absolute.” Among things Obama could do before he leaves the presidency, she said, would be to allow the use of the American dollar in bilateral business and permit direct fi- nancial transactions between banks in the U.S. and Cuba. Vidal said Obama could also eliminate policies that he has power over as chief executive, such the so-called “Wet foot, dry foot” policy that allows Cubans who step on American soil to stay in the U.S. and apply for perma- nent residency. Cuba diplomat casts wary eye on White House race A 34-year-old George Town man has been ar- rested on suspicion of stabbing a man earlier this week. Officers were called to the Cayman Islands Hospital shortly after 1 a.m. on Monday after a man with stab wounds to his abdomen had arrived in a private car. The man told police he was stabbed during an argument at a residence on School Road in George Town. After officers went to the premises and made inquiries, a man attended George Town Police Station around 3:30 a.m., where he was ar- rested on suspicion of as- sault causing grievous bodily harm. Police con- firmed the arrested man remained in custody Tuesday afternoon. The victim under- went surgery and re- mained at the critical care unit at hospital Tuesday, police said. Arrest made after stabbing Director General of the U.S. division at Cuba’s Foreign Ministry, Josefina Vidal. – PHOTO: AP Grand Court jurors on the Jan. 13-April 5 ses- sion are requested to re- port for duty at 2 p.m. on Wednesday, rather than at 9 a.m. This notice does not affect the seven jurors currently sitting on the CarePay trial. GrAnd COurT jury nOTiCe (AP) – For the first time, U.S. border authorities will inspect trucks entering the United States on Mexican soil, working simultaneously with Mexican counterparts. The new facility in Tijuana, which aims to re- duce congestion and speed cargo crossings into San Diego, overcame resistance in Mexico to letting U.S. officials carry guns. In April, Mexican lawmakers approved changes to the country’s firearms law to permit foreign customs and immigration officials to be armed on the job. U.S. Customs and Border Protection Commissioner R. Gil Kerlikowske and Mexican Treasury Secretary Luis Videgaray were scheduled to open the joint inspection fa- cility Tuesday in Tijuana’s Mesa de Otay section, just blocks from one of the bus- iest crossings on the 1,954- mile border. Customs and Border Protection provided few de- tails ahead of the ceremony, saying the effort “represents the shared commitment be- tween the United States and Mexico to promote economic growth and prosperity be- tween the two countries con- nected by more than just a shared border.” US inspection facility opens in Mexico3 LOCAL NEWS Cayman Compass • Wednesday January 13, 2016 Voter numbers continue to decline Number of registering officers not expected to increase with single-member constituencies Carol Winker cwinker@pinnaclemedialtd.com The number of regis- tered voters in Cayman has continued to decline since the general elections in May 2013. As of Jan. 1, 2016, the Official Register of Voters kept by the Elections Office shows a total of 18,271 people registered to cast a ballot. This is a drop of 221 from the all-time high of 18,492 when voters last went to the polls. The decrease has been steady: there were 18,466 voters in January 2014, and 18,323 in January 2015. Supervisor of Elections Wesley Howell explained the decrease since last year: “The registering officers, in some cases acting on con- cerns from the public, have been removing ineligible names from the electoral register. Unfortunately, the number of persons added during the year totaled some 84, while a larger number of names, 136, were removed, mainly due to deaths and persons being sentenced to more than 12 months in prison.” Mr. Howell pointed out that registering to vote is voluntary. “The registering officers can only add eligible persons who take the first step and submit completed registra- tion forms,” he said. He said an estimated 5,000 people are unregistered but are eligible to register. A breakdown of voter to- tals by what Mr. Howell re- ferred to as “traditional dis- trict boundaries” shows the following decreases since April 1, 2013 – the voter list in effect for the May 2013 elections: ■■ George Town: From 7,441 voters to 7,374, a decrease of 67 ■■ Bodden Town: From 4,550 to 4,526, a decrease of 24 ■■ West Bay: From 4,220 to 4,156, a decrease of 64 ■■ Cayman Brac and Little Cayman: From 1,041 to 1,013, a decrease of 28 ■■ East End shows a net loss of 20, from 641 to 621 ■■ North Side went from 599 voters to 581, a decrease of 18. Now that the order has been signed for single- member constituencies to come into effect, the Cayman Islands is divided into 19 electoral districts. The Elections Law re- quires that each elec- toral district have a reg- istering officer, but Mr. Howell does not expect the number of registering offi- cers to increase. “The existing registering officer complement will op- erate within traditional dis- trict boundaries,” he said. “It is, however, expected that the larger traditional districts will see the formal adoption of a provision in the existing law, where it is possible to appoint assis- tant registering officers to cover the number of voters in the single-member con- stituencies that fall within the larger traditional district boundaries.” Registering to vote is an ongoing process and is not limited to an election year, Elections Office manager Tosca Connor pointed out. Last year, Ms. Connor suggested one reason for the decrease in voter num- bers was that people who have become eligible have not registered. The voting age is 18. Residents who are qualified can come to the Elections Office on the second floor of the Smith Road Centre, or apply to their district regis- tering office. Gina Whittaker, recep- tionist and ID technician, said a few people have been coming in to register, but more have come to file a change of name or address. She has a camera on hand to make voter ID cards. Office hours are 8:30 a.m. to 5 p.m. Monday through Friday. Application forms for voter registration or change of a voter’s name, address or occupation may be obtained from the office or downloaded from the website www.electionsoffice.ky. Form 4, the application for registration as an elector, explains what documents are needed to apply. Registering officers The following people serve as registering officers for their electoral districts: ■■ West Bay: darlene Owens-elliott ■■ George Town: Kathryn Myles ■■ Bodden Town: Kerry nixon ■■ east end: Leisa Velonie Welcome ■■ north side: Patricia ebanks ■■ Cayman Brac and Little Cayman: ellen Lazzari The number of people registered to vote in Cayman has dropped since the 2013 election. Police arrest two men at sea Two men were arrested Sunday after being inter- cepted by marine police of- ficers 10 miles off Barkers in West Bay. The arrests were made after officers on board the police helicopter, which was on patrol, spotted what police described as a “suspicious vessel” – a 35-foot “Go-fast” boat – with two men on board. The Niven D police vessel was alerted and intercepted the boat. The men on board surrendered to the marine of- ficers, who brought the boat to the police marine base, po- lice said in a press release. Police said the men were arrested on immigration- related offenses. One of the men is a 31-year-old from West Bay. Police were trying to de- termine the nationality of the other man, who is 45. Think:Inequality Addressing the Global Imbalance Ritz-Carlton Grand Cayman Tuesday 19 Jan 2016 Save the Date A world class speaker line up. Global vision with local impact. Thought provoking review. What are the top trends facing the world in 2016? What does this mean for Cayman? Join some of the world's most thought provoking experts to explore the threats and opportunities and how they impact our local progress. CEO 2016 brings you some of the most exciting speakers on the international conference circuit: Dr. Dambisa Moyo; Global economist and World Economic Forum Young Global Leader. Dr. Vikram Mansharamani; Global equity investor and Lecturer at Yale University. Rasmus Ankersen; best selling author, speaker on performance development Craig Wright; Chief Economist with Royal Bank of Canada and trusted advisor to businesses and athletes. fidelityceo.com Visit our website Think:Inequality Addressing the Global Imbalance Ritz-Carlton Grand Cayman Tuesday 19 Jan 2016 Save the Date A world class speaker line up. Global vision with local impact. Thought provoking review. What are the top trends facing the world in 2016? What does this mean for Cayman? Join some of the world's most thought provoking experts to explore the threats and opportunities and how they impact our local progress. CEO 2016 brings you some of the most exciting speakers on the international conference circuit: Dr. Dambisa Moyo; Global economist and World Economic Forum Young Global Leader. Dr. Vikram Mansharamani; Global equity investor and Lecturer at Yale University. Rasmus Ankersen; best selling author, speaker on performance development Craig Wright; Chief Economist with Royal Bank of Canada and trusted advisor to businesses and athletes. fidelityceo.com Visit our websiteThe islands’ most-trusted news source 4 – EDITORIAL – Opinion&Letters The Cayman Compass welcomes comments, opinions and viewpoints from readers. Letters to the editor can be emailed to editor@pinnaclemedialtd.com, submitted via www.caymancompass.com, sent by post or hand-delivered to the Compass office. BloomBerg View editorial Board George Osborne, Britain’s chancellor of the exchequer, depressed both his currency and his countrymen last week with a downer of speech that blamed “a dangerous cocktail of new threats from around the world” for a considerably gloomier economic outlook than the one he delivered less than two months ago. He’s not wrong about the state of the world. But he would have done better to focus more on what Britain can do to strengthen its own economy. For all its post-crisis rhetoric about the need for austerity and budget-balancing, the gov- ernment has done too little to prepare the British economy for tougher times. Its most exciting initia- tive is the so-called Northern Powerhouse, designed to en- courage growth in the north of the country through in- vestment and a “devolu- tion revolution” away from London. But much of the extra money (or power, for that matter) has yet to ma- terialize. On measures from GDP per capita to health and education outcomes, Britain’s northeast lags the rest of the country. Osborne also filled in some details about a new commission on infrastruc- ture, which is scheduled to deliver a report in March. He is correct to re-empha- size the benefits of more in- frastructure spending, but it’s not as if this is a new idea. The question is how much to spend, and the answer is pretty straightforward: as much as Britain can afford. The chancellor is also right to warn against complacency. The British economy is doing better than Europe’s, in no small part because it is open and flexible. There is a reason why so many migrants from around Europe and beyond want to settle there. That said, there are signs the British economy is not quite as robust as many think – or as the chancellor has claimed. The economy grew 2.1 percent year-on- year in the third quarter of 2015, lower than forecast. Per capita GDP has barely recov- ered to its pre-crisis level. Productivity remains stub- bornly low. Its spending on research and development remains low compared with that of its major trading part- ners. And key areas of ad- vanced manufacturing, such as aerospace and pharma- ceuticals – areas the govern- ment would like to see grow – require high levels of R&D. Britain’s economy cannot help but catch a chill when the global winds blow colder. Yet all the pressures Osborne cited in his speech – turmoil in China, tensions in the Middle East, low com- modity prices – were well- known last fall, when he and other government officials were declaring the economy in good health. In the wake of the finan- cial crisis, there was much official talk about “rebal- ancing” the economy – relying less on consumption and debt and more on investment. If the economy remains un- balanced, the government has mainly itself to blame. © 2016, Bloomberg View Wednesday January 13, 2016 • Cayman COmpass All signs point to an extremely promising harvest in East End: The seeds have been sown. Now, the first buds are beginning to open. In this case, the crops to which we refer aren’t agricultural — but medicinal. As is published on the front page of today’s newspaper, development of Health City Cayman Islands is about to enter a new stage of growth. According to stories in today’s Compass and our business broadsheet the Cayman Islands Journal, Grand Cayman’s medical tourism facility intends to invest nearly $25 million in capital projects in the year 2016, on new or expanded residential, commercial, medical and hospitality ventures. Health City’s plans follow on its accreditation last April by the U.S.-based Joint Commission Inter- national, an independent gold-standard benchmark indicating that Cayman’s tourism hospital offers top-notch medical care. (Put another way, it’s the healthcare equivalent of the “Good Housekeeping Seal of Approval.”) Since the “Shetty Hospital” (as we know it in Cayman) opened in February 2014, construction has largely been limited to the hospital campus itself. But that, too, is about to change, as local entrepreneur Joe Imparato prepares to break ground on a major com- mercial development around Health City, consisting initially of a new supermarket, bank, gas station, pharmacy, restaurant and liquor store. Longer-term plans for Mr. Imparato’s City Services include a hotel and apartments. Although it is independent and unaffiliated with Health City, the planned development by City Services certainly has a symbiotic relationship with the healthcare complex, which is operated jointly by India- based Narayana Health and U.S.-based Ascension. We mean, quite simply, that the City Services devel- opment (as the name implies), will be built in order to satisfy the demands of Health City clientele and staff, and otherwise to take advantages of Health City’s economic potential. “We believe in and support Health City,” Mr. Imparato said. “While slow to get mobilized, we now observe significant strides towards achieving their long-term goals. “Gene and Harry [Health City developers Gene Thompson and Harry Chandi] are to be commended for bringing this project to Cayman and our plans are to parallel Health City’s expansion in years to come.” We’d like to add our own commendations for Mr. Thompson, in particular, for his dedication to ensuring that Caymanians are first in line to partake of the career opportunities presented by Health City, starting at the very beginning by employing local construc- tion workers to build the hospital facility. That effort continues today, and into the future, as hundreds of students participate in on-site internships, local nursing students undertake clinical rotations — a program that is a joint partnership with UCCI and Cayman’s govern- ment — and Health City looks toward establishing a medical college. Health City has the potential to be a singular catalyst for change in the trajectory of Grand Cayman’s development, as the elusive “third pillar” of our country’s economy. More generally speaking, Health City and complementary enterprises are illus- trative of the power of private sector entrepreneur- ialism, when the public sector wisely confines its role to that of enabler and facilitator. Health City: 2016 looks like a growth year improve UK’s economy through investment Britain’s economy cannot help but catch a chill when the global winds blow colder. Yet all the pressures Osborne cited in his speech [ … ] were well-known last fall, when he and other government officials were declaring the economy in good health. In a speech he made in Wales last Thursday, Britain’s Chancellor of the Exchequer George Osborne warned of a ‘dangerous cocktail’ of new threats to the United Kingdom’s economy. – Photo: aP Printed and Published by: Caymanian Compass Limited (a subsidiary of Pinnacle Media Ltd) Compass Centre Shedden Road, George Town send us yOur VieWs Or neWs: P.O. Box 1365 Grand Cayman KY1-1108. Cayman Islands Telephone: (345) 815-0095 Email: newsdesk@pinnaclemedialtd.com adVertise With us: Telephone: (345) 949-5111 Email: sales@pinnaclemedialtd.com Website: www.caymancompass.com PUBLISHERS daVid r. legge and Vicki l. legge EdITOR-In-CHIEf daVid r. legge A MEMBER OF THE INTER-AMERICAN PRESS ASSOCIATION “Give light and the people will find their own way”5 LOCAL NEWS Cayman Compass • Wednesday January 13, 2016 Cayman’s tomato crop struggling Jewel levy jlevy@pinnaclemedialtd.com Tomato farmers are re- porting that this year’s crop is failing to produce much fruit. “I don’t know if it is the cli- mate change or what … all I know is the trees are in pretty good condition, but there is barely any fruit on the vines,” said Morris Copeland of Copeland Farms in High Rock in East End. “Mostly all of the Cayman farmers have been having an issue with it,” said farmer Hamlin Stephenson. He thinks the weather and a virus are the reasons why the plants are not bearing fruit. Patrick Panton of East End Farm and Gardens says he has lost more than 3,000 young to adult plants. “If, in fact, the issue is a virus, viruses are carried by insects and the most prominent ones on toma- toes in Cayman are carried by the white fly,” he said. Mr. Panton said he noticed an increase in white flies this past summer, not only on his farm, but also on other resi- dential and commercial prop- erties where his business car- ried out landscaping. “Why is that? Maybe it is because of the extended drought we’ve been having,” Mr. Panton said. Mr. Panton said he drops tomato seeds in the middle of August and September and harvests through November and mid May. Other farmers follow dif- ferent times for planting and harvesting, he said. The Cooperative State Research, Education, and Extension Service agency within the U.S. Department of Agriculture, suggests the to- mato is the crop most ad- versely affected by excessive heat. If daytime temperatures are over 90 degrees for several days, tomato flowers will drop off without setting fruit. In Cayman, Mr. Stephenson said it’s not just the tomatoes. Almost all of his crops are being affected. For farmers, he said, “this can be a frus- trating problem as a tomato plant with no flowers cannot produce fruit.” Typically, from late September to early February, Mr. Copeland said he would have already harvested nearly 20,000 pounds of to- matoes, but that just was not happening this year and the season was nearly gone. “It is basically zero,” he said. “Last year, we had more than we could sell and we had to drop the price to get rid of it. There were tomatoes like crazy. [But] not this year.” Mr. Copeland thinks he will not be planting any more tomatoes. “I’m thinking of moving to some other crops … it’s just not working out [and] it does not make sense to plant the trees if you not getting any fruits,” he said. Marilyn Nasirun, who has a farm in High Rock, East End, thought she had just sprayed her plants too much. “Everyone had a lower crop this year because I do not see much selling at the market. I did not realize it had something to do with climate change until I overheard other farmers talking,” she said. “The weather this year has been particularly warm be- cause of El Nino. Therefore, I am not surprised that we were seeing this condition in Cayman,” said Joel Walton of Plantation Farms. This year, Mr. Walton said, he did not plant any toma- toes and could not say for sure what was the problem. However, he said if farmers are using seeds that were not spe- cifically developed for warm nighttime temperatures, then they will have some problems. “Most tomato plants are not specifically modified to bear in warm nights, and most tomato plants generally need the nighttime temperature of 75 degrees to bear. Even if it’s 75 degrees at night and the next day’s temperature gets above 87-88, and even though the plants put on buds the night before, they will all drop off and start the whole cycle again,” he said. Mr. Stephenson agrees with Mr. Walton that every so often this problem occurs. He said the El Nino weather pattern is not only affecting tomatoes, but other fruit trees as well. “If we think how warm the nights are, that’s the big problem, and because it is so warm, it is contributing to the virus on the fruit trees that we are having also,” Mr. Stephenson said. Joseph Jackman, a former chief agricultural and veteri- nary officer, thinks one of the causes for the low tomato crop could be the temperature dif- ferential between cool nights and hot days. Dr. Jackman said night temperatures have been drop- ping into the 70s and the day- time temperature is in the 80s. The result is that when the blossoms come out, the dif- ference in temperature causes moisture to form between blossom layers, which causes the blossoms to drop off. He suggested farmers use a spray called Blossom Set to help minimize blossom drop. Blossom Set spray is a com- mercially available liquid that helps tomato plants produce tomatoes from blossoms. It is often used when the nighttime temperature during blossom set is lower than optimal. Kimberly Salgado selling tomato slicers for Geoffrey Dixon Farms in Lower Valley, Bodden Town, shows a few harvested this year. Patrick Panton, owner of East End Farm and Gardens, serves Rick Redding from the slim pickings of grape, plum juliette, black cherries and orange grape tomatoes he was able to harvest. – Photo: Jewel levy Water Authority - Cayman REMINDER FOR LICENSED PLUMBERS Annual Plumber Licence Renewal Fees are due for 2016 All Apprentice, Journeyman and Master Plumbers must renew their licence each year. Please bring a completed renewal form and the appropriate fee to the Water Authority’s Administrative Headquarters on Red Gate Road before 31 January, 2016 to ensure your licence stays current. NOTE: Fees for 2016 Plumber Licences as per The Water Authority Regulations 2012 are as follows: Apprentice Plumber CI $20.00 per year Journeyman Plumber CI $50.00 per year Master Plumber CI $100.00 per year Plumber’s Licence Renewal Forms along with a list of all currently renewed Licensed Plumbers can be found on our website at www.waterauthority.ky. All non-Caymanian applicants must include a copy of a valid CI Work Permit. For further information please contact the Plumbers’ Examination Board Secretary at 949 - 2837 ext. 2001. NOMINATE Proudofthem@gov.ky CAYMAN’S YOUTH Reaching Higher MINISTRY OF COMMUNITY AFFAIRS, YOUTH & SPORTS6 DISTRICT DAYS Wednesday January 13, 2016 • Cayman Compass District Days Sister Islands Obituary Pauline ‘Polly’ Tibbetts, 1927-2016 Matriarch, benefactor and mentor and a familiar figure in the Sister Islands, Pauline “Polly” Tibbetts passed away on Jan. 4 in St. Petersburg, Florida. She was 89. A memorial service cele- brating her life was held on Jan. 7 in St. Petersburg. Mrs. Tibbetts and her husband, the late Linton Tibbetts, were well known in Little Cayman and Cayman Brac, with their ex- tended families spanning far and wide. “My grandmother grew up as an orphan in Kentucky but began making her first trips to the Cayman Islands soon after she married my grand- father in 1948,” her grandson Michael Tibbetts said. “She was known and loved by many – particularly in the Sister Islands. We are thankful that she lived a long and joyous life.” Mrs. Tibbetts and her husband, a Brac native who became a successful building supply businessman in the United States, made quite an impact on the Sister Islands. Mr. Tibbetts was behind the construction of the Brac Reef Hotel and later the Brac Reef Resort. Mr. Tibbetts was also in- strumental in the formation of Red Carpet Airways in the 1970s, which flew from Tampa/St. Petersburg to the Brac three times a week for about a decade. “My grandparents loved the peace and tranquility of Little Cayman,” said Michael Tibbetts. “They often visited my grandfather’s family on Cayman Brac but I think they liked the seclusion of Little Cayman.” The couple’s extensive personal collection of arti- facts associated with the sea- faring and pioneering his- tory of the Islands’ early settlers led to the opening of the Little Cayman Museum, which is dedicated to pre- serving the unique heritage of the Sister Islands. Mrs. Tibbetts was on hand for the opening of the museum in 2014, an event attended by nu- merous dignitaries including Premier Alden McLaughlin and Deputy Premier and Sister Isladnds MLA Moses Kirkconnell. “My grandmother loved to host meals at their home on Little Cayman, often wel- coming visitors for a fish fry and homemade ice cream,” he recalled. “She continued traveling to the islands with her family up until a few months ago.” Mrs. Tibbetts’s obituary in the Tampa Bay Times notes that she was one of six children living in Harlan, Kentucky. Orphaned at an early age, she and her sister Alta were separated from their siblings. While two elder boys joined the mili- tary, and the youngest were taken in by relatives, the two girls were sent to the Harrison-Chilhowee Baptist Academy, now known as The King’s Academy, in Seymour, Tennessee. According to the obituary, “The girls lived on campus year- round, completing their gradu- ation requirements in three years. She was class secre- tary-treasurer two years, Young Women’s Auxiliary secretary three years, and played a role in the class play three years. After her graduation, Polly attended Carson-Newman College. Her college career was cut short to care for her older sister who was ill.” The obituary notes that soon after, the family reunited after her older brothers fin- ished their military careers, and invited the girls to move to St. Petersburg where Mrs. Tibbetts became the matri- arch of the family. She was married in a double ceremony with Alta, who wed Jack Hurlston on Easter, March 28, 1948. “Polly and Linton each brought into the relation- ship a solid commitment to hard work and a deep appre- ciation for family relation- ships. When their four chil- dren were born, they were raised in a Christian home and instilled with the same values that carried their par- ents through difficult times. Family was God’s greatest blessing to her and filled her life with great joy and affec- tion. Her faith in and love for God guided how she lived her life. Polly was also known for her laughter, hospitality and generosity,” notes the obituary. Mrs. Tibbetts was hon- ored by the King’s Academy as Outstanding Alumna of 2013 for her generous sup- port of the school that meant so much to her. Living her life guided by the Bible, Mrs. Tibbetts’s fa- vorite verse was Ephesians 2:8 “For it is by grace you have been saved, through faith, and this is not from yourself, it is a gift from God.” “She was a great example of how life should be lived – unselfishly, loving and for- giving each other, giving to those in need, and loving God,” the obituary notes. Mrs. Tibbetts was prede- ceased by her sons Daniel E. Tibbetts and David N. Tibbetts, and is survived by her two daughters, Mary L. Brandes and her hus- band Russ Brandes of St. Petersburg and Donna E. Hooker of Louisville, Tennessee; her nine grand- children, Jeffrey Brandes and his wife Natalie, Tyler Brandes and his wife Ashley, Polly Klepacki and her hus- band Kenny, Kyle Hooker and his wife Adrienne, Ryan “Bubba” Hooker and his wife Jessica, Angela Hooker, Michael Tibbetts and his wife Rebecca, Emily Allenbach and her husband Mark, and Jessica Buchanan and her husband David; and 19 great-grandchil- dren, Liliana and Madeline Allenbach, Benjamin, Warren and Carson Brandes, Charlotte, Colin and Conor Brandes, Bradyn, Bryce, and Brylee Hooker, Daniel and Ellyson Hooker, Madison Brandes and Reece, Wesley and Corinne Klepacki, and Caroline and Lydia Mae Tibbetts. Pauline ‘Polly’ tibbetts 50 years agO: a career move applauded and happy homecomings In the Jan. 5, 1966 edition of the Caymanian Weekly, a precursor of the Cayman Compass, Brac correspon- dent Lilian Ritch wrote: “Congratulations to Mr. Herbert Martin of Creek who has been accepted as Probationer Road Foreman in the Public Works Department. He left for Grand Cayman on the third instant. Herbert is a past student of Creek Primary School where he passed his Second Year Jamaica Local in 1955. He has been to sea with National Bulk Carriers, Inc. as an oiler. Always with the inclina- tion to improve his intel- lectual standard, he came home after the last trip de- termined to make a start in private study. His goal is to be a General Civil Engineer. Not daunted by a first failure, he has made a second attempt at G.C.E. O-Level subjects on Jan. 4. We congratulate him on stepping on the first rung of the ladder of practical experience through service with the P.W.D. “For the past year he has been the genial bread de- livery man of the Pioneer Bakery. As Feste, the clown, in the recent production of “The Steward Malvolio,” he gave a fine performance of humour and wit showing his ability to take an art se- riously. All his friends join in wishing him the very best for the future.” In the newspaper’s Jan. 12, 1966 edition, Ms. Ritch reported: “Mr. and Mrs. Lambert Foster of the Creek were the happy hosts of two sons and their families and a daughter on brief visits. They were Mr. and Mrs. Woodrow Foster, James and Stephen (their sons). Their business. O.W. Foster and Sons is that of home builders and developers in Tampa, Florida. They were at home with the Foster clan at the Buccaneer’s Inn at a cocktail party and dance, which was a very happy function. “With Mr. H. Burton Foster were his wife, Vera, and daughter, Sue, and his sister-in-law, Miss Lorna Mae Simpson. The Fosters are promoters of Tropicana Apartments in Port Arthur and Groves, Texas. This is a concept of 104 spacious apartments styled in their brochure ‘The Ultimate in Modern Apt. Living.’ “Mrs. Lilly Collins of New Orleans, Louisiana, is the eldest of Mr. Lambert’s family. She left the island 35 years ago, before the 1932 hurricane, and missed the greater population of that time. She thinks the possibilities here for tour- ists are terrific – one day from New Orleans to here is fabulous. The quietude and all year even temper- ature are our best attrac- tion. Mrs. Collins is an in- terior decorator. “Visiting here recently after an absence of 30 years was Miss Pearl Scott, daughter of the late Captain Decey and Mrs. Fanny Scott of West End. She has been resident for over 21 years in Trinidad, with her ad- opted parents, Uncle Dick and Daphne Tibbetts of Point–a-Pierre where Mr. Tibbetts was dock master for Texaco until he re- tired recently. She now has Trinidadian citizen- ship. She thinks the island has changed completely for the better – living is so much more convenient with electricity, running water, stores, lovely home build- ings, and was most pleased to find the fruit bearing trees, many of which she did not think grew here at all. To her, the south side seems the most beautiful part of the island.”7 DISTRICT DAYS Cayman Compass • Wednesday January 13, 2016 District Days Sister Islands Brac hotel to reopen after face-lift Basia McGuire bmcguire@pinnaclemedialtd.com The Cayman Brac Beach Resort plans to hold its offi- cial grand opening on Friday, following four months of ren- ovation work. The resort has completely overhauled its indoor and outdoor spaces. The work was completed last month. Celebrations will kick off with an invitation-only ceremony and ribbon cut- ting in the morning, which will be attended by Premier Alden McLaughlin and other dignitaries. Later in the day, artist Jim Hellemn will give a short presentation on his mural that will be hung by the new bar. The public is then in- vited to the resort’s grand opening barbecue from 6-9 p.m., featuring live entertain- ment from Bonafide from 7:30–10:30 p.m. Resort Manager Timothy Williams noted there are countless improvements to the resort, which was originally built in 1987 by Linton Tibbetts and most recently upgraded after it was destroyed by Hurricane Paloma in 2008. Arch and Godfrey served as general contractor for the current project. Mr. Williams said the ren- ovation is aimed at ensuring the resort’s long-term success by appealing to current and future generations of guests. “We are also looking to set a positive example for tourism development on Cayman Brac,” he said. A major highlight of the renovations is a new 144,000 gallon, 4,500 square foot pool built by Island Pools. Featuring a sloped “beach entry” and lit at night by color changing LED lights, it also has an 8 foot deep end for dive training. The pool will be surrounded by new chaise longues. “There is also a brand new two-story bar featuring a glass bar top and new bar furniture. Upstairs is a lovely viewing area and may be of- fered for reserved private events,” Mr. Williams said. The property now boasts 15,000 square feet of hand- laid travertine tile around the pool, bar and walking paths. “The renovations also in- clude new soft goods for the resort rooms, including linens, lamps, French door closets, carpeting on the second floor, and paint, among other things. The entire resort has been re- painted, and there is a new bar menu and dining ware,” Mr. Williams added. He said the upgrades are designed to improve the overall experience for guests by harmonizing the proper- ty’s best features. “There was previously mostly empty space be- tween our guest rooms, pool and bar and the beach area,” he said. “The goal was to bring the beach closer to our guests so there would be a natural pro- gression from the bar to the pool to the beach. Adding ad- ditional walkways and im- proving existing paths also serves to beckon our guests towards the new central fea- tures of the property.” A glimpse into a peaceful past: Clarinda Christian If there is such a thing as a classic image of a Cayman Brac flashback, this is it. Of all the photos in the book “The People Time Forgot,” this seems to be a reader favorite. In this image, Clarinda Christian, whose home was near Spot Bay, enjoys a peaceful moment of solitude and silence. Such was Brac life in the early 1980’s when this photo was taken, and such is still the mood of the Brac today. Of interest also are the architecture and old-style floorboards of the dwelling. Ms. Christian spent most of her life doing domestic chores around her home for family or friends. She passed away in November 2015, aged 91. This image is from the book ‘The People Time Forgot’ by George Nowak, available at the National Museum. All proceeds from the sales of the book go toward museum projects. Palm trees reflected in the brand new pool. – Photo: tim WilliamsThe islands’ most-trusted news source 8 Wednesday January 13, 2016 • Cayman Compass Visiting Gynecologist will be available for consultation at Dr. Vivek's offi ce at Smith Road Plaza from 18-29 January, 2016 For appointments please call (345)945-6077 +1 (345) 323-7840 www.drbarryrichter.com might have been considered suspicious, there was no ev- idence presented that indi- cated she benefited person- ally from the award of the CarePay patient swipe-card contract to AIS Cayman Ltd. in December 2010. According to testimony in the trial, Ms. Rodriguez’s role in the CarePay scheme was that she handled checks totaling at least $1.5 million and cash totaling $55,000 while working at the of- fices of the former Admiral Administration firm, of which Watson was the global man- aging director. The Crown has alleged the amounts to be illicit proceeds from the contract award earned when Watson and Jeffrey Webb pursued a course of action that defrauded the government. Jurors heard last week that three checks brought to Admiral by Cayman Islands Health Services Authority employees were signed for by Ms. Rodriguez between August 2011 and May 2012. In addition, two cash enve- lopes the Crown said con- sisted of profits from the CarePay contract were al- leged to have been handled by her at different points during 2011. A statement Ms. Rodriguez made to police in 2014 indicated that she was instructed by Webb, not Watson, to sign for the checks and pass them on, ei- ther to Webb himself or to a woman who Ms. Rodriguez said she assumed worked at AIS Cayman. Ms. Rodriguez’s statement – which was read at trial along with the tran- script of her police interview – indicated she did this as a favor to Webb, whom she had known for years, and that Watson had generally in- structed her to assist Webb with business matters that arose from time to time. Written answers to po- lice questions provided by Watson, which were also read at trial Friday, gave a similar account. Mr. Mettyear said he agreed with Ms. Rodriguez’s attorney, Laurence Aiolfi, that a jury could not have concluded that she knew the money passing through her hands at the time might have con- sisted of criminal property. “It’s my job to tell you [refer- ring to the jury] to find her not guilty,” Justice Mettyear said, after which the jury foreman rose and formally pronounced the verdict. Mr. Aiolfi con- firmed that the judge’s deci- sion essentially meant the Crown had not proved its case against Ms. Rodriguez. He de- clined to make further com- ments on Tuesday. The CarePay trial con- tinued Tuesday with the defense opening its case. Watson faces six charges in a Grand Court indictment is- sued in November. The new 5,000-square- foot oncology wing will be an addition to the medical on- cology facility. Construction on both the oncology and outpatient units will start in the second quarter of 2016, finishing in the last quarter of the year or the first quarter of 2017. Meanwhile, planners will em- bark on a market analysis for Health City’s long-antici- pated medical college. Details of the school re- main undecided, but the project took its first steps on Nov. 15 when 10 third-year students from the University College of the Cayman Islands four-year nursing program became the first interns in Health City’s four-week training program. Ultimately, Health City hopes to employ UCCI-trained nurses full-time. Also in the 2016 pipe- line are non-hospital proj- ects, created by Health City Development: Phase one of the 59-unit Parrot Ridge Apartments, comprising one-, two- and three-bedroom units between 450 square feet and 1,000 square feet, designed for staff and pa- tients. Work will start in the first quarter of 2016, ending in the last quarter. Gene Thompson, project director for the Thompson Development Group, said hospital staff had been boarding at the Wyndham Reef Resort, which offered reduced rates. “They worked with us, but that cannot con- tinue, so next year, we will have our own staff housing,” Mr. Thompson said. At the same time, design and enabling works will start on the second phase of Parrot Ridge, another 59 units sim- ilar to phase one, and on de- sign for the 185-room hotel, which will include medical services intended to aid pa- tients in transitioning out of Health City after treatment. “We have a ‘good’ chal- lenge here,” Mr. Thompson said. “We originally thought the average patient stay would be 9.5 days, but now we see it’s more like 30 days, much longer than we had anticipated.” In the second quarter, Health City Development will start work on the 24,000-square-foot Heron Landing Commercial Centre, scheduled to open in the final quarter. Adjoining development In addition to the develop- ment on the Health City site, Joe Imparato of City Services, which has significant land holdings around the medical tourism facility, has long- term plans for a hotel and apartments in the area. The Central Planning Authority gave approval last week for three commercial buildings and a gas station off Sea View Road to the west of the hospital entrance. Mr. Imparato said the re- tail businesses, which will in- clude a pharmacy, restaurant and liquor store, would be completed within 22 months. “Our primary goal is to provide convenient services for the staff at Health City together with the assisted living community that is part of Health City’s master plan, and will be created in due course,” he said. The developer already has a Planned Area Development application approved, re- zoning large tracts of land in East End. Conceptual plans for a community provision- ally named Lighthouse Coast envisage homes, offices and a hotel springing up around the hospital. Mr. Imparato said, “City Services owns all of the land surrounding the Shetty Hospital comprising of just over 800 acres. Our long-term objective is to develop this land in phases that will in- clude retail, commercial, recre- ational, hotel, and residential.” The phasing of each stage will depend on the speed of growth of the med- ical tourism industry in the Cayman Islands. “We be- lieve in and support Health City,” Mr. Imparato said. “While slow to get mobilized, we now observe significant strides towards achieving their long-term goals. “Gene and Harry [Health City developers Gene Thompson and Harry Chandi] are to be commended for bringing this project to Cayman and our plans are to parallel Health City’s expan- sion in years to come.” He said City Services is seeking a co-developer for the hotel, which he said would be a “traditional tourist facility” in the moderate price range. Even though Health City is planning its own hotel next to the hospital, Mr. Imparato be- lieves each development will target different customers. He said the Health City hotel was expected to be de- signed to transition patients out of hospital, with the ben- efit of medical supervision and assistance as needed. No time line has been set for the hotel. Separate plan- ning applications will need to be made for each stage of the development. See page 18 of today’s Journal for more on this story. continue to work alongside the Royal Cayman Islands Police Service to ensure all visitors to the Cayman Islands have the best pos- sible experience.” The department has a task force that reaches out to tourists impacted by crime, traffic acci- dents and other incidents. The department could not confirm whether anyone had met with the victims of the robbery. In a separate incident, last week a man tried to steal a purse left on the beach by a swimmer at Smith Cove. A woman from a cruise ship spotted the 42-year-old man rifling through her and her hus- band’s things on the beach. The couple chased the man, who was quickly tackled by an off-duty police officer visiting from New York and a tour bus driver. The two held the man, Al Handell Pearson, until police officers arrived and arrested him. Police ask anyone with information about the Rum Point robbery to contact the Bodden Town station at 947-2220 or Crime Stoppers at 800-8477. Expansion plans ahead for Health City CONTINUED FROM PAGE 1 CONTINUED FROM PAGE 1 CaREPay TRial Judge orders ‘not guilty’ verdict for Watson co-defendant CONTINUED FROM PAGE 1 Robber punches 77-year-old Rum Point tourist in face House votes to strengthen gov’t records law WASHINGTON (AP) – The House has approved legisla- tion making it easier to ob- tain government records, as a new congressional report concluded that the freedom of information process under the Obama administration is broken and in need of serious change. The bill, approved by a voice vote, would require government agencies to make information available to the public online. It also would require agencies to adopt a presumption in favor of dis- closing records rather than keeping them secret. The vote came as Republicans on the House Oversight and Government Reform Committee released a report asserting that the freedom of information law, enacted 50 years ago, is plagued by a number of problems, including a lack of communication from federal agencies, unreasonable re- dactions and abusive fees. Backlogs of Freedom of Information Act requests have more than doubled since President Barack Obama took office in 2009, the report said, and agencies are sitting on thousands of unfulfilled doc- ument requests. “When President Obama took office he promised an ‘unprecedented level of open- ness in government.’ This re- port demonstrates that is not the case,” said Rep. Jason Chaffetz, R-Utah, chairman of the House Oversight panel. Instead of the prom- ised openness and transpar- ency, “this administration is playing a game of hide the document from the American people,” Chaffetz said. Rep. Elijah Cummings of Maryland, the top Democrat on the oversight panel, called the GOP report unfair and said committee members were not given a chance to vote on it. “There is no doubt that the FOIA process can and must be improved,” Cummings said, “but issuing this erro- neous, incomplete and highly partisan staff report will not help these goals.” While freedom of in- formation requests have soared in recent years, staffing levels have not kept pace, Cummings said. “Unfortunately, Republicans in Congress starved agencies of resources, and then they act surprised that there are backlogs,” he said. The White House said it was examining the legislation to see whether Obama could support it. But spokesman Josh Earnest sharply criti- cized Congress for exempting itself from the transpar- ency requirement, saying it was not an “American way to pursue this.” “They’re writing the rules in such a way that they don’t have to play by them,” Earnest said. The oversight report said the State Department was ar- guably the worst agency with respect to FOIA compliance and said the agency has nu- merous open requests that are nearly a decade old. Rep. Jason ChaffetzThe islands’ most-trusted news source 9 Business Cayman Compass • Wednesday January 13, 2016 BP to cut 4,000 jobs as oil price plunges Oil company BP is cutting some 4,000 jobs in exploration and production over the next two years amid sharp drops in the price of crude. The cuts will include the loss of about 600 jobs in the North Sea. Survey: FATCA negatively affects Americans living overseas MiChAel Klein mklein@pinnaclemedialtd.com Americans living abroad feel that the Foreign Account Tax Compliance Act nega- tively impacts their profes- sional lives and that com- pliance with the related tax reporting requirements is overly burdensome, a survey by Americans Abroad Global Foundation and the University of Nevada has found. But most survey respon- dents believe the U.S. govern- ment is not concerned about the impact FATCA has on its citizens who live overseas. FATCA demands that U.S. taxpayers report informa- tion about their foreign fi- nancial assets and bank ac- counts in addition to the already existing requirement to report foreign bank and financial accounts (FBAR). Penalties for failing to file the disclosures are high, ranging from $10,000 to $100,000, or 50 percent of the account balance for FBAR violations. “The new rules, and their interaction with existing law, have created confusion and consternation among many U.S. taxpayers,” the survey re- port said. “In addition, signif- icant numbers of taxpayers have been faced with situations where banks and other finan- cial institutions either closed their accounts or refused to open accounts for them.” More than three-quarters of respondents said com- plying with U.S. tax laws puts them at a professional disad- vantage compared to others working in their country of residence. Also, 86 percent of U.S. expatriates said that FATCA needs to be reworked to allow Americans overseas ac- cess to banking services and include a “same country ex- emption” provision, which would exempt from reporting those accounts that are held in the country where the tax- payer lives. Overseas Americans generally felt the Internal Revenue Service was not keeping them informed about how to comply with evolving tax laws. Nearly two-thirds stated they strongly dis- agree with the statement that the U.S. government is doing a good job of keeping them informed. Sonja Pippin, associate professor in accounting at the University of Nevada said, “The consensus from this sample of Americans abroad feels that the U.S. government does not recog- nize how the FATCA legisla- tion is negatively impacting them, limiting their ability to maintain legitimate banking and financial relationships and, that in many respects, simply does not care how the legislation is affecting a community of law-abiding citizens who have chosen to live overseas for work or per- sonal reasons.” More than 80 percent of respondents noted that U.S. tax laws are more compli- cated than the tax law in their country of residence, and that U.S. tax laws had become even more compli- cated in recent years. Americans living abroad generally expressed in the survey that they did not con- sider tax evasion to be a big problem, but agreed that some control and efforts to combat tax evasion are nec- essary. However, only 12 per- cent believe new legislation is needed to achieve this, and 84 percent do not think FATCA is necessary to pre- vent tax fraud. “These survey results are important,” said Charles Bruce, ACAGF chairman. “They will be used as a baseline for informing the public, creating educa- tional programs and advo- cating for legislative changes to address the issues of Americans abroad.” He said the survey re- sults indicate that Americans want to comply with tax laws but want sensible simplifi- cation of the rules, including a “same country” provision. They also demand more out- reach from the IRS on how to comply, and they “want to vote for representatives who understand their is- sues,” he added. More than 80 percent of respondents noted that U.S. tax laws are more complicated than the tax law in their country of residence, and that U.S. tax laws had become even more complicated in recent years. MiChAel Klein mklein@pinnaclemedialtd.com The Cayman Islands Monetary Authority issued 26 new insurance licenses and four insurance interme- diary licenses last year. The number of Class A insur- ance companies, which are licensed to offer insurance products in the domestic market, increased from 28 to 31 during 2015. However, a larger number of insurance licenses were sur- rendered during the past 12 months, which reduced the number of Class B, C and D in- surance companies, consisting of captives and reinsurance companies, to 708, down from 760 at the end of 2014. Earlier last year, Kieran O’Mahony, president of the Insurance Managers Association of Cayman, pointed to the U.S. health- care reform and the consol- idation of healthcare sys- tems in the North American market as the main reasons for the decline. Given that the Cayman Islands is the leading juris- diction for healthcare cap- tives, this has resulted in a consolidation of healthcare captives in Cayman. Almost half of all Cayman cap- tives focus on healthcare-re- lated risks, and more than 90 percent insure risks in North America. However, the remaining captives tend to be larger and better capitalized and provide the opportunity to write new lines of business, he noted. At the end of 2015, med- ical malpractice liability con- tinued to be the largest pri- mary line of business with 239 companies, or 34 percent of all captives, followed by workers’ compensation with 149 companies, representing 21 percent of all captives. As of Dec. 31, 2015, the Cayman Islands’ interna- tional insurance market re- ported total premiums of US$12.7 billion, and total assets were reported at US$59 billion. Another contributing factor to the pressure on cap- tive insurance numbers in Cayman is the growing com- petition in the sector globally. Vermont in the U.S., the third-largest captive domi- cile trailing Bermuda and Cayman, reported it had li- censed 33 new captive in- surers in 2015 compared to 16 in 2014. Eleven captives, including six risk retention groups, moved to Vermont in 2015, with captive re-domestica- tions coming from Arizona, Bermuda, Cayman Islands, Kentucky, Nevada and South Carolina. Another contributing factor to the pressure on captive insurance numbers in Cayman is the growing competition in the sector globally. CIMA adds 30 new insurance licenses in 2015; total number falls Kieran O’Mahony Hedge funds have lowest annual return since 2011 Hedge funds on average returned only 1.56 percent last year in challenging mar- kets, the lowest annual re- turn since 2011. However, hedge funds outperformed the under- lying equity markets such as the MSCI World Index, which lost 0.48 percent for the year, data provider Eurekahedge reported. Assets under manage- ment by the industry in- creased by US$110 billion in 2015. More than half of this figure represents new in- vestor capital inflows. The most successful market for hedge funds was Japan, where man- agers gained 6.21 per- cent, followed by European managers, who returned 5.06 percent. North American funds trailed with a flat perfor- mance of 0.03 percent. Hedge funds focusing on China outperformed the CSI 300 Index by 6.5 percent and returned 12.08 percent for the year, after a rally in the fourth quarter, with gains of 8.52 percent. Investment strategies Distressed debt was the worst performing hedge fund strategy of the year, down 5.31 percent, the big- gest loss since 2008. Arbitrage strategies, in contrast, were up 4.46 per- cent, buoyed by volatility arbitrage trading strat- egies, followed by long/ short equities and then macro managers with gains of 2.99 percent and 2.36 percent, respectively. During the last quarter, macro managers’ alloca- tions into FX, equity in- dexes and metals have led to some hedge funds posting modest gains on a year-to-date basis. Toward the end of the year, FX con- tinued to be a key trading theme for macro man- agers building positions in the euro, yen and the U.S. dollar pairs. In rush to exIt yuan, ChIna traders buy sInkIng hong kong stoCks HONG KONG – Chinese in- vestors are so desperate to shift their money out of yuan-denominated assets that they’re piling into some of the world’s worst-per- forming stocks. Mainland buyers pur- chased Hong Kong shares through the Shanghai stock link for a 10th week last week, even as the Hang Seng Index tumbled 6.7 percent. Chinese traders held 112.5 billion yuan (US$17.1 bil- lion) of the city’s equities by Monday, up by 23.7 bil- lion yuan since late October. With the yuan weakening, investors are looking for a way out, according to Reorient Group. “By buying Hong Kong stocks, it’s like buying the Hong Kong dollar,” said Uwe Parpart, chief strategist at the brokerage. Mainland in- vestors are expecting “further depreciation and when that’s the case it’s a good idea to get out. If you buy at a cer- tain rate and then the yuan goes down, even when the stock market goes down, you may still be getting ahead in the game.” © 2016, Bloomberg NewsNext >