Cayman Islands: Country and Foreign Investment
Investments by Foreigners
Offshore activities are encouraged by the Cayman Government; however there are no incentives directed towards foreign investment on the islands themselves, other than exemption from import duty for building materials intended for the construction of new hotels. As regards investment, Caymanians and foreigners are treated equally; there are in any case no taxes impinging on the investment process.
It was announced at the end of August 2011, that the Cayman Government had signed an agreement with Cayman Enterprise City (CEC), which gives the developer exclusive rights to construct, develop, operate and maintain a special economic zone on the islands, intended to attract global science, technology, commodities and derivatives, media and educational entities to the Islands.
“CEC represents an opportunity for the Cayman Islands to diversify its economic base,” McKeeva Bush, the Cayman Island's Prime Minister said. “It’s also worth noting that this project requires no government investment, as it will be completely privately funded, and the developer also has not requested waivers for duties on materials or stamp duties.”
Although SEZs exist in a number of developed and emerging economies, the SEZ in the Cayman Islands will be the first in the Caribbean region, said Jason Blick, who is the CEO of CEC.
“The cooperation and inward investment-friendly attitude of the Cayman Islands government, and the Civil Service, has been outstanding,” he noted. “They truly understand the positive effect the zone will have on Cayman, and their support has been incredible.”
The Special Economic Zones Law provides for exemption from direct or indirect taxes and import duties until the end of 2061. For an enterprise to obtain a special economic zone trade certificate, it must be licensed as an exempted company or exempted limited partnership, therefore carrying out all trading outside of the Cayman Islands. Authorised activities for Cayman Enterprise City include: Academia; Biotechnology; Commodities and Derivatives and other financial services; Internet and Technology such as computer programming; Media activities including film, video and television production and music publishing; Outsourcing including management consultancy and so on. Businesses supporting the listed activities also qualify.
The CEC was officially launched in February 2012, and 14 businesses had set up operations in the zone by July 2012. By July 2012, this figure had grown to 60 and according to reports, a further 170 companies are in the pipeline.