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. 
 
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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.
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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. For sale by the 
Superintendent of Documents, U.S. Government Printing Office, 
Washington, DC 20402.
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