Cayman was one of the biggest upward movers in the 39th edition of the Global Financial Centres Index. The jurisdiction was ranked as the world’s 68th-best financial centre, up from 86th the year before. That jump of 18 places was the fourth-largest in the latest edition of the index, which was published in late March.
The climb left Cayman as the second-highest financial centre in the entire Latin America and Caribbean region, above much larger centres, such as São Paulo, a city with almost 12 million people.
“The Cayman Islands’ rise in the index is an encouraging result and an important recognition of the work being done across our financial services industry,” said Steve McIntosh, CEO of Cayman Finance.
McIntosh also believes the jurisdiction’s rise in the index is “recognition of Cayman’s high-quality professional services ecosystem, respected legal and regulatory framework, and a proven ability to serve global clients in a stable, sophisticated, and responsive jurisdiction.”
How Cayman outperformed
This year, Cayman’s overall score increased to 681 from 673. That score is based on a mix of quantitative and qualitative inputs. The index includes 147 ‘instrumental factors’, such as data from the World Bank, OECD and United Nations, which are split into five categories: business environment, human capital, infrastructure, financial sector development and reputational and general.
Cayman’s small size means that it is always going to underperform larger financial centres in quantitative assessments of areas like human capital and infrastructure. Indeed, of the 67 centres ranked above Cayman, only three have smaller populations, which indicates that the jurisdiction overperforms on a per capita basis.
The reason for Cayman’s overperformance on a per capita basis is that the quantitative data, which tends to work against smaller jurisdictions, was combined with approximately 34,000 assessments from more than 5,000 respondents. And that’s where Cayman performed well.
The high number of international responses for Cayman demonstrated the jurisdiction’s global connectivity. “Financial centres thrive when they develop deep connections with other centres,” said report author and former Lord Mayor of the City of London, professor Michael Mainelli.
“The GFCI allows us to measure connectivity by investigating the number of assessments given to and received from other financial centres … Cayman has strong connections with leading centres [like] London, Singapore and Dubai.”
Yet McIntosh warned that Cayman’s strong performance shouldn’t be “a cause for complacency”.
“The report makes clear that competitiveness increasingly depends on predictability, regulatory responsiveness and flexibility,” McIntosh said. “Those are all areas where Cayman has real strengths, but also where we must keep improving if we want to build on this momentum.”