MAPPING CAYMAN’S ECONOMIC ROADMAP AFTER COVID-19

The Cayman Islands could see a gradual reopening but a lot depends on containing the spread of COVID-19 locally.

But even with that prospect, it's clear that the economic priorities will more than likely have to be re-arranged for at least the short to medium term.

That assessment was prompted by this Caymanian Times perspective posed to Hon. Premier Alden McLaughlin:

“It is clear that the future will not be business as usual and the survival of many businesses will depend on their adaption to the changes that will come.

The Premier was asked if he “would recommend that business owners and staff use the next few weeks under curfew to revisit strategies and make adjustments for the post-COVID-19 era?”

“Absolutely,” he replied without hesitation or equivocation.

In expanding on the subject, Mr McLaughlin revealed that this matter has been occupying his government’s attention.

“It is clear to me that it is unlikely that we will have a tourism business for the rest of this calendar year at least,” he estimated.

The Cayman Islands economy is driven by a dynamic sector tourism - both cruise and stay-over - one of the leaders in the region, and its globally-prominent and buoyant financial services industry.

The worldwide tourism industry, particularly the cruise sector, has been battered by the coronavirus crisis with several high-profile instances of onboard outbreaks and deaths, plus cruise ships being denied access to ports including George Town.

The stay-over element of the sector has also been badly affected mainly due to border closures and local restrictions on public gatherings.

REFOCUS

Addressing comments directly to the businesses here involved in the tourism sector, Mr McLaughlin had this advice:

“If that has been your focus, you need to start thinking about how you can re-purpose your energies, your assets, your resources including human resources to do something else within the local economy which is not dependent upon the influx of visitors.”

The ongoing restrictions of the past few weeks have been based on alternating hard overnight and soft daytime curfews with a focus on preserving lives by curtailing the spread of the virus.

Increasingly now though, attention is turning to the livelihoods components; business continuation and economic recovery.

While precise figures are not available, it is clear that many businesses and the economy broadly have contracted due to the local effects of the COVID-19 pandemic.

Cognizant of that, the Premier explained that the government’s priority has been “to get Cayman safe again to move about, to work, and to do business.”

However, he made it clear that under the circumstances “the borders are likely to stay closed for many, many more months” unless a vaccine is developed against the virus or a rapid and accurate testing system is developed.

“Absent any of those things, it would be impossible to say ‘visitors please come, investors please come’ because all of these efforts we would have been making these last few months or so would have been for nought because the virus would be here in a heartbeat, and then we would be back (to), or probably in a worse situation than is currently the case.”

RE-PURPOSE

At the same time though, Premier McLaughlin has pointed to areas which could drive business activity, especially on his theme of companies re-purposing and refocusing on the local economy.

“If we can contain and eliminate the virus here,” he suggested, “there are a significant number of development projects, lots of construction underway that has been halted. Those projects can continue."

He explained that “in the majority of cases the money is already in place and the developers can continue with their projects.”

For companies involved in the tourism sector, Premier McLaughlin's message to them is; "think long and hard about your staff if you still have them - to the extent that they are on work permit and are unlikely to be able to transfer to something that you are trying to locally.”

And specifically to tourism business managers with non-national staff, the Premier offers this guidance:

“You need to think about how you can provide them with some sort of severance package and take advantage of whatever opportunities avail to let them return home until we wind up in a position where we can open back up to tourists.”

Citing construction and tourism as two examples, Mr McLaughlin said that’s the kind of thinking which should be going on in the business sector.

CHAMBER OF COMMERCE

Developing a business continuity plan is one of the recommendations of the Cayman Islands Chamber of Commerce.

The Chamber has been holding a series of online seminars (webinars) for the business community and has posted a 16-point COVID-19 survival plan for small business on its website.

One of its recommendations echoes the views of the Premier on re-deploying staff.

“If you don’t have a business continuity plan, use this time to develop one. You may have competent staff who are unable to carry out their regular duties. It may be useful to re-deploy them to this activity. The plan will help you to identify actions you can take should your business have to close for an extended period of time.”

ECONOMIC RECOVERY FUND

Meanwhile, a national recovery fund has been launched aiming for public, private sector and civic participation.

In announcing the plan, His Excellency, Governor Martyn Roper outlined its main objectives as providing support to the government with procuring and funding personal protective equipment and other medical supplies and supporting persons in distress who have lost income and need financial assistance.

The Dart corporation has already pumped $KY1 million to get it off the ground.

Governor Roper lauded the initiative and credited Mr Dart’s “long-term commitment to the Cayman Islands which in times like this is a hugely valuable asset.”

“Mr Dart has offered one million dollars and he will offer a further four million dollars if there is matching funding from other private sector donors,” he stated.

Premier Alden McLaughlin said he hoped other businesses would also contribute.

“Hopefully we can find other like-minded and other financially capable businesses across the community that will also contribute to this.”