Archive for September 19th, 2009

Pricey commercial real estate may be reduced

| 19/09/2009 | 4 Comments

(CNS): The Port Authority may have good news for the merchants trading of the Royal Watler Cruise Terminal according to reports on News 27. The Chairman of the Port Authority Board, Stefan Baraud, said the board is looking in to the possibility of reducing the rents. Tenants in the retail units have long complained of the very high rents despite their prime location. Baraud said the board was concerned as it wanted to stop turnover in the units as it was evident the rates were higher than other George Town locations.

The port chair said looking at the rates was a priority and the board is now talking with its lawyer on the best way to deal with the matter as all the tenants are under contract. There are 19 retail units at the Royal Watler terminal, 12 shops and seven kiosks, and when the unit opened in 2007 tenants were complaining that it was the most expensive retail space in Grand Cayman.

When the units were leased McKeeva Bush, who was at the time the opposition leader, called the rents “ridiculous and outrageous".

The terminal, which became the subject of controversy following an auditor general report, was developed using money borrowed from the Florida-Caribbean Cruise Association (FCCA).

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Wrong tool for the job

| 19/09/2009 | 0 Comments

(Economist): “It isusually agreed that casinos should, in the public interest, be inaccessible and expensive. And perhaps the same is true of stock exchanges.” John Maynard Keynes, writing in the 1930s, was in favour of making it costly to switch into and out of investments. With just a trace of English snobbery, he wrote approvingly of the high fees and taxes levied on share transfers in the City of London, which he contrasted with the lower turnover costs on Wall Street. The smooth workings of New York’s stockmarket served only to promote “speculation” over “enterprise”, he wrote. The sins of London were less grave.

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Mac:We don’t need UK cash

| 19/09/2009 | 73 Comments

(CNS): With still no news coming from London regarding approval for the $372 million loan the Cayman Islands government needs to increases its borrowing commitment, Leader of Government Businesses McKeeva Bush has told Radio Jamaica that Cayman doesn’t need “one red cent” from the people of the United Kingdom. He explained to the radio station that all the government needs is permission to access funds that it has already raised on the private markets. Bush has been in London this week meeting with FCO officials, who still want Cayman to introduce new direct taxes which Bush has refused to do.

Although the CI government is under pressure from the Foreign And Commonwealth Office to introduce sustainable direct taxes, such as property, sales or even income taxes, to get Cayman out of debt and balance the budget, the LoGB has consistently said that, aside from increasing some existing fees and possibly introducing indirect, he will not bow to the pressure. Bush said the UDP government plans to diversify the economy and re-generate wealth by attracting investment.

"We are going to do some divestment, that will take a longer time. We are going to increase some fees. As I said, inward investment is the way to go; that was what had raised the revenue before, not income tax, not property tax; I ain’t going to do so," Bush told Radio Jamaica. He said, as he has stated publically here in Cayman since receiving the OT Minister, Chris Bryant’s letter refusing approval for more borrowing, that the UK’s stance is unreasonable but that the situation was as a result of the previous administration’s spending.

"We need to borrow … because the last government ran up the bill. It was stupid, mere stupidity, for any government as small as we are without huge natural resources for income to start huge capital projects and expect to fund it out of recurrent revenue. Not even businesses do that," Bush added.

"Now we have to get their concurrence to borrow. We are not asking them to lend us, we are not asking them to pay and there is no question about if we can pay. I don’t expect one soul in Britain to give me one red cent because we can manage, we have managed," the LoGB observed.

According to a report on Bloomberg yesterday, the UK posted the biggest budget deficit for any August since modern records began in 1993 as the recession destroyed tax revenue and welfare costs soared. The $26.3 billion shortfall compared with a 9.9 billion pounds deficit a year earlier, the Office for National Statistics said. Britain will have to cut spending at the fastest pace since the 1970s to repair the damage the slump has inflicted on the public finances, economistswarned this week. The International Monetary Fund expects the budget deficit to exceed 13 percent of gross domestic product next year, the most in the Group of 20.

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