An overview of the Cayman Islands

Hello! Thanks so much for stopping by. For this post we’ll be traveling to the Caribbean to learn about the beautiful Cayman Islands.

History

Christopher Columbus is widely credited as the first western explorer to discover the Cayman Islands in 1503. The islands would remain uninhabited after his discovery for many years, and became a regular stop for pirates who stopped by to replenish their stocks with the abundance of turtle meat and fresh water on the islands. In 1670, the British Empire claimed the islands as their own under the Treaty of Madrid. The islands continued to be a popular den for pirates up until the 1730s, when permanent settlement began. All throughout these years the slave trade was practiced on the islands until the British officially banned it in 1807. During these years, the Cayman Islands were also administered as a dependency of Jamaica (Jamaica was ruled by British governors/administrators). A key event in the history of the Cayman Islands was the Wreck of Ten Sail, an event that happened off the coast of Grand Cayman in 1794. Legend has it that a British convoy coming from Jamaica and headed to England and the United States got shipwrecked on reefs surrounding Grand Cayman. Local residents risked their lives to rescue most of the crews, with one of the crew members supposedly being a member of the royal family. When news of the residents bravery reached England, King George III is said to have issued a law decreeing that the people of the Cayman Islands would be free from paying war taxes. While this is all legend, the story is widely held in high regard by Cayman residents. Folklore like this explain why the Cayman Islands has always had a close relationship with England, so much so that when Jamaica finally achieved its independence in 1962, the Cayman Islands severed its administrative/political ties and opted to become a direct dependency of Britain.

Geography

The Cayman Islands is a three island archipelago in the Caribbean consisting of the Grand Cayman, Little Cayman and Cayman Brac:

These islands sit in the Caribbean Sea, neighboring Jamaica and Haiti to the east/southeast, Cuba to the north, and Honduras + Mexico to the west:

The islands are actually outcrops/peaks of an underwater ridge that sits alongside the Cayman Trough, a massive fault zone at the bottom of the Western Caribbean Sea.

Note: Faults are breaks in the rocks that make up the Earth’s crust. The energy released by the rapid movement on active faults is what causes most earthquakes.

The Cayman islands have a tropical marine climate, meaning that the ocean has majority “say” in weather conditions (e.g. moist winds due to passing over the oceans, more prone to hurricanes, rainfall, etc). This also means that the Cayman Islands have a wet and dry season format all year long, a theme that is common in most tropical regions.

Economy

The official currency on the Cayman Islands is the Cayman Island dollar, and as of the time of this writing, 1 KYD = 1.22 USD. The strength of the Cayman Island Dollar can largely be attributed to the Cayman Islands’ economy: this location is one of the most sought after tourism and vacation destinations in the world. The Cayman Islands is also regarded as one of the world’s leading global banking and financial centers. Over 40 of the top 50 major international banks hold licences here, in addition to a myriad of hedge funds and law firms. The appeal of this location to the worlds’ elite and the financial services industry is in large part due to its “non-intrusive,” tax laws, which have in effect earned the Cayman Islands a reputation for being an offshore tax haven.

Note: For individuals, tax haven’s offer low to no taxes on earnings, inheritance and even personal income. For corporations, tax havens provide a way to save billions as companies can report their profits to subsidiaries created in these locations. Examples of other tax havens around the world include Luxembourg, Mauritius, Bermuda and Monaco.

The Cayman Islands has always had a reputation as a place where the uber rich can make their money invisible to the world. Its reputation as a tax haven has come under increased scrutiny in recent years, as the issue of tax avoidance has become somewhat of a recurring theme in mainstream media and politics (e.g. think Bernie Sanders economic stance in the 2016 US presidential election; Obama’s speech in 2009 specifically calling out the Cayman Islands on this theme; the allegations and crackdown efforts from British opposition MP Margaret Hodge, German Chancellor Angela Merkel and former French President Nicolas Sarkozy…). There are many who believe the public backlash is making the Cayman Islands a less attractive place to conduct business, and concerns have been raised about how the Cayman Island’s economy would fare if the major corporations and banks that fuel the Cayman economy decided to leave. Should be interesting to see how this drama plays out over the next few years. If this subject interests you, check out the video below that gives a general overview on how transfer pricing and offshore tax havens work:

Trivia question: Do you know what famous novel (that also became a movie) covered many of the themes related to tax havens and was partly set in the Cayman Islands? Hint: One of my favorite actors, Gene Hackman played a major role in the movie adaptation.

Culture

Regarding language, because the Cayman Islands have roots in Jamaica and Great Britain, British English and Jamaican Patois are the two main languages spoken across the islands. A form of Creole is also spoken on the smaller islands of Cayman Brac and Little Cayman. Today there are over 100 different nationalities represented on the Cayman Islands, and as such the local dialect, ‘Caymanian Patois’ is always evolving (similar to West African Pidgin in a sense). Check out the below video featuring Bradley from Educate Cayman giving a good high level breakdown of the Cayman accent:

Regarding food, the Cayman islands has an international cuisine with an especially strong Jamaican influence. Turtle meat is also a favorite in traditional Cayman cuisine.

There are tons of fun things to do on the Cayman Islands, which is why this location is a favorite for vacationers around the world. There are boat tours; opportunities to check out places like Stingray City where you can get up close with the cartilaginous aquatic natives; shipwrecks to see; exotic beaches and countless restaurants. The Cayman Islands are also a favorite for scuba divers around the world. Perhaps the the most popular highlight of the Cayman Islands is the annual Batabano Carnival, held every May. The festival was created by Rotary Club of the Grand Cayman, and officially launched in 1983. There are actually 2 carnivals held: one for kids (happening on April 30th, a week from the posting of this article) and one for adults, which will be happening on May 7th this year. Check out the video below for highlights from 2015’s adult festivities:

Caymanian Jewels

The Cayman Islands have also produced some notable personalities that have made positive contributions to the Cayman culture both locally and abroad. A few of these personalities include:

  • Former Victoria’s Secret model Selita Ebanks
  • Independent filmmaker Frank Flowers
  • Actress Grace Gealey (raised in the Cayman Islands and currently cast member on Fox soap-opera Empire)
  • Pop/house musician Natasha Kozaily and her band Natula

I hope you enjoyed this high level overview of the Cayman Islands. I’ll leave you with the below video showing the Cayman Islands at a glance. Enjoy.