By Staff Writer
Despite declining for the third quarter of this year, a surge in imports is already being noticed for the latter part of the year.
The latest report by the Economic and Statistics Office (ESO) shows that the total value of the merchandise imports declined between July and September, reflecting decreased economic activity due to the global Covid-19 pandemic.
However, the Customs and Border Control (CBC) department is already noting a significant increase in imports for the fourth quarter and the Christmas season prompting it to extend its opening hours and remind importers of the various procedures they need to adhere to.
There were over 23,000 individual imports recorded for the month of November alone.
The CBC advised that “the expected trend for the season is that imports will continue to rise as the airport remains under limited departures and persons are not able to leave the island to complete their usual holiday shopping.”
Meanwhile, tracking the pattern of imports to Cayman or a year adversely impacted by the COVID-19 pandemic, the ESO notes a 10% decrease in the value of goods imported in the last quarter.
“Goods Import for the third quarter stood at $296.85 million, a decrease of 10.2 per cent, as non-petroleum and petroleum-related imports declined.
The ESO third-quarter report also pointed to reductions in imports of food items such as fruits and vegetables, meat, and fish, and cereal by 6.6 per cent as well as beverages and tobacco by 0.2 per cent.
However it said, machinery and transport equipment, such as road vehicles, industrial machinery, and telecoms equipment was marginally higher by 1.7 per cent for the quarter.
Additionally, manufactured goods such as building materials like cement, cork and wood and textiles actually grew by 12.3 per cent for the September quarter.
In a related report, the ESO records that the Consumer Price Index (CPI) fell by 1.6 per cent in the third quarter of 2020 when compared to the same period in 2019.
Of the twelve CPI divisions, five recorded decreases, it stated.
“In the third quarter of 2020, the division transport recorded the largest average price decline in the CPI basket (6.9%). This was due mainly to the fall in the average cost of passenger transport by air, which fell by 25.4 per cent while fuels decreased by 14.1 per cent.
The index for recreation and culture fell by 5.6 per cent in the third quarter of 2020, the ESO reported, attributing this to a 43.2 per cent fall in the price for package holidays (abroad).
The electricity index declined by 24.6 per cent while water supply dropped by 15.3 per cent. The overall housing and utilities index decreased by 2.8 per cent as a result, the ESO noted.
A comparison of the import patterns and overall economic activity for Cayman in the first and last quarters of this year paints an interesting picture with the year being book-ended by particularly strong imports.
A considerable uptick in imports in the latter part of the year reflects the strong performance of the economy before the crippling effects of the pandemic hit in March.
According to the ESO, the Cayman Islands economy is estimated to have increased by 1.9 per cent in the first three months of 2020 before being negatively impacted by the closure of the borders in the latter half of March.
Meanwhile, the last quarter of the year is being driven largely by imports reflecting the projection by the CBC that imports will continue to rise as the airport remains under limited departures and persons are not able to leave the island to complete their usual holiday shopping.
It has also been suggested that the rise in imports over the Christmas season could be linked to the emergency pensions payout to offset the impact of the pandemic on personal and household finances of those eligible.
With import duties being a key component of government revenues, especially with the decline in tourism, the fiscal deficit projected at the height of the pandemic around May this year might now be offset to some extent by year-end and seasonal imports as a result.
Appearing on the Radio Cayman programme Talk Today, Hon. Finance Minister, Roy McTaggart offered a note of relief when he said: “The dire situation we were anticipating at the beginning of this year does not seem to be materialising.”
“A lot will depend in these last few weeks on how good the Christmas season is in terms of imports…all the things that Caymanians would normally buy during the Christmas season,” the Finance Minister stated.