Cayman: A Growth Story

Average Caymanian ‘not having a better life’

  • Inflation pain: Kenneth Bryan, opposition Member of the Legislative Assembly

The average Caymanian is not having a better life as a result of an economic boom, an opposition lawmaker argues.

Kenneth Bryan, at 39 the youngest Member of the Legislative Assembly, said increasing demand for goods and services was driving up living costs and he called for a more planned approach to growth to ensure Caymanians benefited.

Rents rose by an average 19.7 per cent year-over-year in the first quarter of 2019 according to Cayman’s Economics and Statistics Office.

In March 2019, the overall rate of inflation as measured by Cayman’s Consumer Price Index, was 4.5 per cent. By comparison, in Bermuda inflation averaged less than 1 per cent over the first 11 months of last year.

“Cayman has strong economic growth, but the beneficiaries don’t seem to be the people of the country,” Mr Bryan, a former TV reporter and political journalist, said. “The average Caymanian is not having a better life as a result of the development.

“We have to find the equilibrium between growing incrementally and ensuring that Caymanians are the beneficiaries. Many Caymanians are living paycheque to paycheque.”

Cayman has no impediments to foreigners buying property — a system that has driven up values, leading to frustration among locals priced out of the market.

“The cost of real estate has risen out of reach of the average Caymanian,” Mr Bryan said. “Home ownership is becoming more of a dream than reality.

“If property is out of reach for people in their own country, then you can end up with everyone else owning your country and you not having access to it.”

Adding to the internal inflationary forces were external factors, he said. One was the US interest rate, which had crept higher in recent years, impacting local mortgage repayments.

Another was the increase in the world oil price — the spot price of crude went up by around 17 per cent in 2019 — which drove up the cost of the diesel fuel burnt to generate Cayman’s electricity, a cost passed on directly to consumers, just as in Bermuda through the fuel adjustment rate.

“The Government has been smart enough to give civil servants a 5 per cent cost-of-living increase for the last three years — and another one for this year planned in the last Budget,” Mr Bryan said. “The caveat for that one is that they have to find savings in their various departments to help pay for it.”

Low-wage workers in the private sector were not seeing wage increases in line with inflation, however, he said.

Some Caymanians, unable to afford to live near the capital George Town, have moved out to the eastern districts, where accommodation is cheaper. However, this has increased congestion on the roads as increasing numbers of people commute by car each day, costly in terms of money and time.

Alternative methods of transport are limited. “We have a bus service, but it’s not very reliable or efficient,” Mr Bryan said.

He called for the Government to make a proper evaluation of how economic growth would benefit all of the territory’s people and to plan accordingly.

“It may look from the outside as if we are thriving, but who are we building for?” Mr Bryan said. “It does not seem to be for the average Caymanian.

“Businesses are doing well and those with money are making more money, but those left behind are getting further behind.”

Cayman has a minimum wage of CI$6 (US$7.20) per hour. The Government has launched a review to consider an increase. Mr Bryan argued that the review could take a year or 18 months to complete and that low earners needed the increase quicker to keep pace with inflation.

“In the Civil Service, there is no post that pays less than CI$10 an hour, but the Government is happy for the private sector to be paying as little as CI$6 an hour,” Mr Bryan said. “Salaries and wages are livelihoods for human beings — this government seems to be more in favour of business.”

Labour does not have a strong voice in Cayman because of the lack of trade unions and the absence of a political party with a pro-labour ideology, Mr Bryan said.

Mr Bryan said some workers organised themselves through associations, which were not assertive enough to be described as unions. The best known of these is the Civil Service Association.

“There’s a fear of unions that has been instilled into the minds of voters, based on the idea that they are a barrier to progress,” Mr Bryan said.