From Loop Cayman

Real Gross Domestic Product of the Cayman Islands in 2013 increased by 1.4 percent. In the second quarter of 2014, GDP growth was estimated at 3.3 percent, higher than the first quarter growth of 1.5 percent.

According to the Minister of Finance, Marco Archer, the local economy felt the prolonged impact of the global recession beginning in 2008 with Gross Domestic Product (GDP) declining from 2008 until 2010. Growth resumed modestly in 2011.

Speaking during the official announcement of the Household Budget Survey 2015, the minister said that macroeconomics indicators such as GDP growth, GDP per capita and the unemployment rate are estimated on a regular basis to provide the government with the overall economic condition of the country.

“But these cannot be used in evaluating the economic well-being of households as measured by their consumption of goods and services,” he quipped.

The minister said the HBS will allow the government to address key questions.

“Has the market power (or value of total consumption) of households in Cayman declined or increased compared to 2007? Which segment of the population experienced significant changes? How much is the “cost of living” for the average household, the households in the lowest 10 percent, those in the highest 10 percent and the segments in between?,” he asked.

The last HBS for the Cayman Islands was conducted in 2007.

The total annual consumption of goods and services estimated from that survey was $1.3 billion. The overall per capita consumption was CI$23,774; the lowest decile (10 percent) of the population had a per capita consumption of $5,410 while the highest decile had $72,251.

“Since then, the country has experienced significant changes, and by God’s grace, we expect the policies that Government have been pursuing to further strengthen the pace of recovery,” the minister said.

The HBS provides the basic data for calculating the “expenditure multiplier” or total economic impact from government spending or private investment in the economy.

“A one dollar increase in new spending in the local economy becomes household income through employment and when spent, generates income for another household, and so on,” he told the country.

The information derived from the HBS has the potential of impacting households in Cayman whose well-being is attached to specific dollar values.

According to the minister, two examples can be cited. One, the direct assistance for families currently served by the Needs Assessment Unit which uses a single income level (CI$3,000) to screen qualified recipients. Two, is the granting of permission by the Immigration Department for work permit holders to bring their dependents to the Islands. “This is subject to a minimum income level corresponding to a benchmark “cost of living” estimate,” he said.

IMAGE: HON-MARCO-ARCHER-MLA-300-200

For more on this story go to: http://loopcayman.com/2014/12/15/latest-cayman-news-economy-felt-prolonged-impact-of-global-recession-marco-archer-said/

To read the complete speech on the above by Minister Archer see iNews Cayman story published December 14 2014 “Cayman Islands launches Household Budget Survey” at: http://www.ieyenews.com/wordpress/cayman-islands-launches-household-budget-survey/