CAYMAN RECORDS ‘ROBUST’ 2024 ECONOMIC PERFORMANCE

By Staff Writer

Cayman’s economy expanded by an estimated 3.3% in the first nine months of 2024, according to the new economic performance report published by the Economic and Statistics Office (ESO).

Available indicators suggest that the Islands’ output expanded across most sectors with only one contracting. The rise in output for the period was largely linked to robust demand for services, the ESO reports in its Third quarter review for 2024.

Electricity and water supply is estimated to have expanded by 5.4%, while health & social work and government services grew by 5.1% and 4.0%, respectively. The construction sector expanded by an estimated 3.0%, while wholesale and retail trade rose by 3.7%. Finance and insurance services, which continue to be the largest contributor to GDP, expanded by 2.7% during the review period.

The rise in output for the period was primarily linked to robust demand for services. Notable expansions in economic activity were also estimated in business services and real estate activities, which rose by 3.7% and 3.5%, respectively.

However, there ESO notes that the increase in output for the period was moderated by a deceleration in the growth of stayover arrivals and a reduction in cruise arrivals. The hotel and restaurant sector is estimated to have expanded by 2.3%.

STRONG PERFORMANCE

The strong performance of the economy in the first three quarters of the year has led to an upward revision of the Calendar year forecast. Economic activity in the Islands was projected to increase by 3.1% for 2024, with demand for auxiliary services expected to remain strong.

The ESO says the robust economic activity and a narrowing of the gap between the demand and supply of labour have resulted in unemployment remaining close to its natural level. (In a separate just-released labour market report the ESO shows the Unemployment Rate for the last six months of 2024 at 2.4%).

The 2024 third quarter economic data also shows that the central government recorded an overall surplus of CI$97.8 million in the first three quarters of last year. This resulted from revenue of $914.0 million and expenditure of $816.1 million.

The central government’s outstanding debt decreased to $421.1 million as at September 2024, compared to $469.0 million recorded as at September 2023.

TOURISM

Providing more detail on how specific sectors performed up to the end of the third quarter last year, the ESO shows total visitor arrivals declined to 1,123,394 for the first three quarters of 2024. This reduction was attributed to a decline in cruise arrivals, while stay-over arrivals increased during the period. Stay-over arrivals increased by 2.3% to 330,514 in the review period. Cruise arrivals declined by 15.4% to 792,880 for the review period. The reduction in cruise arrivals occurred as the number of cruise ship calls to Cayman’s port fell by 58 to 241.

FINANCIAL SERVICES

Financial services indicators for the first nine months of 2024 were generally mixed, with four of the eight indicators increasing and three declining.

The Cayman Islands’ prime lending rate fell by 25 basis points to 8.0% for the review period. Consistently, the KYD weighted average lending contracted by one (1) basis point to 9.09%. Other highlights from the sector include; the number of bank and trust licenses in Cayman declined to 84 at the end of the review period compared to 94 for the same period in 2023, and as of the end of September 2024, a total of 720 insurance companies were registered - a 2.0% increase compared to 706 in 2023.

Funds registered increased by 1.8% to 30,067, and new company registrations in the first three quarters of the year was up by 19.7% to a total of 9,025. Stock Exchange listings declined by 0.3% to 2,769.

CONSTRUCTION

Construction indicators declined for the first three-quarters of 2024. Despite an increase in volume, both building permits and project approvals contracted in value. The value of building permits fell for the second consecutive year nine-month period, falling by 20.9% to $468.1 million. The decline was seen across all categories except houses and hotels. The total value of project approvals contracted to $367.4 million, a 25.0% decrease compared to the same period in 2023.

INFLATION

The first quarter inflation rate was 1.8 percent. Among the main contributors was a 9.7 percent rise in the education index due to higher tuition costs. There was also a 7.3 percent upward movement in transport, a 7.2 percent rise in restaurants and hotels, 5.0 percent in communication, 3.8 percent in health, and a 3.0 percent increase in food and non-alcoholic beverages.

CONSUMER PRICE INDEX(CPI)

A comparison of the first quarter of 2025 with the fourth quarter of 2024 indicates that the CPI declined by 1.0 percent, as the index for transport went down by 2.5 percent, clothing and footwear by 2.4 percent, housing and utilities by 1.9 percent, and miscellaneous goods and services by 0.3 percent.

MERCHANDISE IMPORTS

Merchandise Imports increased in 2024 with the total value of goods imported to the Cayman Islands amounting to $1.65 billion in 2024, an increase of 8.3 percent over the previous year.

Imports of food and live animals amounted to $286.3 million, an 8.5 percent increase over 2023.