Cayman Islands
Cayman Islands
Cayman Islands, a British dependency in the Caribbean located south of Cuba and northwest of Jamaica. Consisting of the islands of Grand Cayman, Cayman Brac, and Little Cayman, the territory covers an area of about 100 square miles. Sighted by Christopher Columbus in 1503, the island group was named Las Tortugas on account of its native sea turtles. By 1530 the name "Caimanas," or "Caymans," derived from a word meaning crocodile in the language of the Caribs, early island visitors, came into acceptance. Permanent settlers arrived after the Treaty of Madrid (1670), by which Spain recognized English claims to these islands in exchange for restraint of pirates whose haunts included the Caymans. From 1863 to 1959, the Cayman Islands were officially a dependency of Jamaica. Upon Jamaican independence in 1962, they chose to remain a British Crown Colony. Since the Constitution of 1972 was implemented, the Caymans have been internally autonomous under an appointed governor.
Aided by government promotion, tourism has become the most important industry, even despite setbacks with terrorist attacks on the United States in 2001 and the landing of Hurricane Ivan in 2004. Cruise ship stopovers to the island are major explanations for the industry's strength.
Offshore finance, another industry of recent prominence, developed in response to banking confidentiality legislation and the absence of direct taxation, making the Caymans an international financial center. As of year-end 2005, there were 305 banks. More significantly, since the mid-1990s, mutual funds have become widely prevalent. At year-end 2005, there were 7,107 registered mutual funds.
In 1996, stricter legislation against money-laundering was passed. In 2002, a tax information exchange agreement with the United States was passed, with which the United States can access information on criminal tax evasion and administrative matters related to U.S. federal income tax. It went into full effect in 2006.
See alsoMadrid, Treaty of (1670); Tourism.
BIBLIOGRAPHY
George S. S. Hirst, Notes on the History of the Cayman Islands (1910; repr. 1967).
H. B. L. Hughes, "Notes on the Cayman Islands," in Jamaican Historical Review 1, no. 2 (1946): 154-158.
Neville Williams, A History of the Cayman Islands (1970).
Brian Uzzell, ed., The Cayman Islands Yearbook and Business Directory (annual).
Paula S. Gibbs