U.S. Department of State Background Notes: Cayman Islands, May 1996 Bureau of Public Affairs May 1996 Official Name: Cayman Islands PROFILE Geography Area: 259 sq. km. (100 sq. mi.) on three islands: Grand Cayman (76 sq. mi.), Cayman Brac (14 sq. mi.), and Little Cayman (10 sq. mi.). Capital: George Town (pop. 12,900). Terrain: Flat. Climate: Tropical. People Nationality: Noun and adjective--Caymanian(s). Population: 33,200. Annual growth rate: 4.3%. Ethnic groups: Afro-European 40%, African 20%, European 20%, other 20%. Religions: United Church, Anglican, other Protestant, Roman Catholic. Language: English. Education: Years compulsory--to age 16. Literacy (age 15 and over)-- 98%. Health: Infant mortality rate--8.4/1,000. Life expectancy--77 yrs. Work force: 17,000. Government Type: British Crown colony. Constitution: 1972; called the Cayman Islands Order. Branches: Executive--governor (representing British monarch), Executive Council. Legislative--unicameral Legislative Assembly (12 elected, three appointed members). Judicial--Summary Court, Grand Court, Cayman Islands Court of Appeal, Her Majesty's Privy Council. Subdivisions: Six electoral districts. Political parties: No formal political parties. Suffrage: Universal at 18. Economy (1993) GDP: $700 million. Growth rate: 1.4%. Per capita income: $23,000. Natural resources: Scenic beaches and underwater attractions, favorable climate. Agriculture: Minor production of vegetables and livestock, turtle farming. Industry: Types--tourism, banking, insurance and finance, construction. Trade: Exports--$10 million: turtle products, manufactured consumer goods. Major market--United States. Imports--$312 million: machinery, manufactures, food, fuels, chemicals. Major suppliers-- U.S., Trinidad and Tobago, U.K., Netherlands Antilles, Japan. Official exchange rate (1995): CI $0.83=U.S. $1. U.S.-CAYMANIAN RELATIONS Although the United Kingdom is responsible for the Cayman Islands' defense and foreign affairs, important bilateral issues are often resolved by negotiations between the Cayman Government and foreign governments, including the United States. Despite close historic and political links to the United Kingdom and Jamaica, geography and the rise of tourism and international finance in the Cayman Islands' economy has made the U.S. its most important foreign economic partner. In 1994, about 250,000 U.S. citizens traveled to the Cayman Islands; some 1,000 Americans are resident there. For U.S. and other foreign investors and businesses, the Cayman Islands' main appeal as a financial center is the absence of all major direct taxes. There are no income, corporate, capital gains, inheritance, gift, or property taxes. Free capital movement, a minimum of government regulations, and a well-developed financial infrastructure, including a pool of professional service providers, all contribute to the islands' attractiveness. With the rise in international narcotics trafficking, the Cayman Government entered into the Narcotics Agreement of 1984 and the Mutual Legal Assistance Treaty of 1986 with the United States in order to reduce the use of its facilities for money laundering operations. U.S. Representation The United States does not maintain diplomatic offices in the Cayman Islands. Diplomatic relations are conducted through the U.S. embassy in London and the British embassy in Washington, DC. The Cayman Islands are, however, part of the consular district administered by the U.S. embassy in Kingston, Jamaica. Inquiries regarding visa applications to the U.S. or other consular matters should be directed to the consular section of the United States embassy, 2 Oxford Road, Kingston 5, Jamaica; tel: 809-929-4850; fax: 809-926- 6743. There also is a U.S. consular agent, John Foster, in the Cayman Islands to assist in providing services for American citizens; tel: 809-949- 7955; fax: 809-949-6080. ======================================== HISTORICAL HIGHLIGHTS The Cayman Islands remained largely uninhabited until the 17th century. A variety of people settled on the islands: pirates, refugees from the Spanish Inquisition, shipwrecked sailors, deserters from Oliver Cromwell's army in Jamaica, and slaves. The majority of Caymanians are of African and British descent, with considerable interracial mixing. The most important religious denomination is the "United Church," a local combination of the Presbyterian and Congregational churches. Roman Catholic, Anglican, Baptist, Church of God, and other Protestant denominations are also present. Great Britain took formal control of the Caymans, along with Jamaica, under the Treaty of Madrid in 1670. Following several unsuccessful attempts, permanent settlement of the islands began in the 1730s. The Cayman Islands historically have been popular as a tax haven. Legend has it that Caymanians in 1788 rescued the crews of a Jamaican merchant ship convoy which had struck a reef at Gun Bay and that the Caymanians were rewarded with King George III's promise to never again impose any tax. The Cayman Islands, initially administered as a dependency of Jamaica, became an independent colony in 1959; they now are a self- governing British Crown colony. ======================================== ECONOMY Although Caymanians enjoy one of the highest standards of living in the world, about 90% of the islands' food and consumer goods must be imported. From the earliest settlement of the Cayman Islands, economic activity was hindered by isolation and a limited natural resource base. The harvesting of sea turtles to resupply passing sailing ships was the first major economic activity on the islands, but local stocks were depleted by the 1790s. Agriculture, while sufficient to support the small early settler population, has always been limited by the scarcity of available land. The advent of modern transportation and telecommunications in the 1950s led to the emergence of what are now considered the Cayman Islands' "twin pillars" of economic development: international finance and tourism. At the end of 1993, there were 29,298 companies-- including 534 banks and 378 insurance companies--licensed in the islands. Tourism has grown to represent about 70% of gross domestic product and 75% of total export earnings. Unspoiled beaches, duty-free shopping, scuba diving, and deep-sea fishing drew more than 850,000 visitors to the islands in 1992. The Cayman Islands' population has tripled in the past 25 years. Its annual growth rate (more than 4%) is largely attributable to immigration; of the 1992 population, only 64% had been born on the islands. Few Caymanians emigrate permanently, although historically many left for extended periods to work as seamen, and today many leave for education or training unavailable on the islands. Education is compulsory to the age of 16 and is free to all Caymanian children. Schools follow the British educational system. Ten primary, one special education, and three high schools are operated by the government. In addition, there is a technical school, a law school, and a community college. GOVERNMENT AND POLITICAL CONDITIONS The Cayman Islands' physical isolation under early British colonial rule allowed the development of an indigenous set of administrative and legal traditions which were codified into a constitution in 1959. Although still a British Crown colony, the islands toady are self- governed in nearly all respects. The constitution, or Cayman Islands Order, that now governs the islands came into effect in 1972 and was amended in 1984. The Cayman Islands' political system is very stable, bolstered by a tradition of restrained civil governance, sustained economic prosperity, and its relative isolation from foreign policy concerns by virtue of its colonial relationship with the United Kingdom. Public discussion revolves around public sector expenditure and social services, the pace of additional economic development, and the status of the large foreign national community on the islands. Government Structure The British crown appoints a governor of the Cayman Islands, who is recruited from the government service of the U.K. and serves as the U.K.'s representative. Daily administration of the islands is conducted by the seven-member Executive Council, whose members are drawn from the Caymans' Legislative Assembly. The chief secretary, financial secretary, and attorney general are appointed by the governor. As noted, responsibility for the Cayman Islands' defense and foreign affairs resides with the United Kingdom; however, the chief secretary has the portfolio for External Affairs, and the Cayman Government may negotiate certain bilateral matters directly with foreign governments. The remaining four members of the Executive Council are elected by the Assembly and divide the remaining administrative portfolios. The 15-seat unicameral Legislative Assembly is composed of 12 members elected by universal suffrage from the Caymans' six electoral districts and the three appointed members of the Executive Council; the Assembly is presided over by an independent speaker. Elections are held at the discretion of the governor at least every four years. Members of the assembly may introduce bills which, if passed, are then approved, returned, or disallowed by the governor. The U.K. Government also reserves the right to disallow bills approved by the governor but has done so only once. The four-tiered judicial system is based on English common law and colonial and local statutes. The Cayman Islands Court of Appeal is the highest court on the islands, but a final appeal may be heard by Her Majesty's Privy Council sitting in London. Political Coalitions Political parties have operated infrequently in the past, and all public officeholders currently are independents. Since the 1970s, groups of candidates have organized themselves into ad hoc coalitions called teams and run on platforms of shared concerns. From 1976 to 1984, the Legislative Assembly was dominated by the Team for National Unity, with a platform of free enterprise and private sector development. The Progress with Dignity Team took control of the Assembly in 1984, emphasizing greater government control of spending and development and a social welfare approach to economic growth. The most recent of these political groupings, the National Team, captured nine of the 12 seats in the 1992 election, stressing the containment of government expenditure. Principal Government Officials Head of State--Queen Elizabeth II Governor--John Owen Chief Secretary, Executive Council--James M. Ryan The Cayman Islands are represented in the United States by the United Kingdom, whose embassy is at 3100 Massachusetts Avenue, Washington DC 20008; tel: 202-462-1340; fax: 202-898-4255. The offices of Cayman Airways, located in Miami, Houston, Atlanta, and Tampa, also may provide travel information. TRAVEL AND BUSINESS INFORMATION The U.S. Department of State's Consular Information Program provides Travel Warnings and Consular Information Sheets. Travel Warnings are issued when the State Department recommends that Americans avoid travel to a certain country. Consular Information Sheets exist for all countries and include information on immigration practices, currency regulations, health conditions, areas of instability, crime and security, political disturbances, and the addresses of the U.S. posts in the subject country. They can be obtained by telephone at (202) 647- 5225 or by fax at (202) 647-3000. To access the Consular Affairs Bulletin Board by computer, dial (202) 647-9225, via a modem with standard settings. Bureau of Consular Affairs' publications on obtaining passports and planning a safe trip abroad are available from the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402, tel. (202) 512-1800. Emergency information concerning Americans traveling abroad may be obtained from the Office of Overseas Citizens Services at (202) 647-5225. Travelers can check the latest health information with the U.S. Centers for Disease Control and Prevention in Atlanta, Georgia. A hotline at (404) 332-4559 gives the most recent health advisories, immunization recommendations or requirements, and advice on food and drinking water safety for regions and countries. A booklet entitled Health Information for International Travel (HHS publication number CDC- 95-8280, price $14.00) is available from the U.S. Government Printing Office, Washington, DC 20402, tel. (202) 512-1800. Information on travel conditions, visa requirements, currency and customs regulations, legal holidays, and other items of interest to travelers also may be obtained before your departure from a country's embassy and/or consulates in the U.S. (for this country, see "Principal Government Officials" listing in this publication). Upon their arrival in a country, U.S. citizens are encouraged to register at the U.S. embassy (see "U.S. Representation" listing in this publication). This may help family members contact you in case of an emergency. Further Electronic Information: Consular Affairs Bulletin Board (CABB). Available by modem, the CABB provides Consular Information Sheets, Travel Warnings, and helpful information for travelers. Access at (202) 647-9225 is free of charge to anyone with a personal computer, modem, telecommunications software, and a telephone line. Department of State Foreign Affairs Network. Available on the Internet, DOSFAN provides timely, global access to official U.S. foreign policy information. Updated daily, DOSFAN includes Background Notes; Dispatch, the official weekly magazine of U.S. foreign policy; daily press briefings; directories of key officers of foreign service posts; etc. DOSFAN is accessible three ways on the Internet: Gopher: dosfan.lib.uic.edu URL: gopher://dosfan.lib.uic.edu/ WWW: http://www.state.gov U.S. Foreign Affairs on CD-ROM (USFAC). Published on a quarterly basis by the U.S. Department of State, USFAC archives information on the Department of State Foreign Affairs Network, and includes an array of official foreign policy information from 1990 to the present. Priced at $80 ($100 foreign), one-year subscriptions include four discs (MSDOS and Macintosh compatible) and are available from the Superintendent of Documents, U.S. Government Printing Office, P.O. Box 37194, Pittsburgh, PA 15250-7954. To order, call (202) 512-1800 or fax (202) 512-2250. Federal Bulletin Board (BBS). A broad range of foreign policy information also is carried on the BBS, operated by the U.S. Government Printing Office (GPO). By modem, dial (202) 512-1387. For general BBS information, call (202) 512-1530. National Trade Data Bank (NTDB). Operated by the U.S. Department of Commerce, the NTDB contains a wealth of trade-related information, including Country Commercial Guides. It is available on the Internet (www.stat-usa.gov) and on CD-ROM. Call the NTDB Help-Line at (202) 482-1986 for more information. ======================================== Background Notes Series -- Published by the United States Department of State -- Bureau of Public Affairs -- Office of Public Communication -- Washington, DC -- Series Editor: Marilyn J. Bremner Cayman Islands -- Department of State Publication 10352 -- May 1996 This material is in the public domain and may be reprinted without permission; citation of this source is appreciated. 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