Future Challenges, Future Opportunities

CAYMAN BUSINESS

A special supplement of

M A G A Z I N E

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C AY M A N B U S I N E S S : F U T U R E C H A L L E N G E S , F U T U R E O P P O R T U N I T I E S

Table of Contents and Index of Advertisers

2 BANK AUSTRIA CAYMAN ISLANDS LIMITED

4 BUSINESS OUTLOOK: OVERVIEW

7 CONSOLIDATED WATER

8 BUSINESS OUTLOOK: TOURISM

11 GRAND HARBOUR

15 DIGICEL

16 BUSINESS OUTLOOK: FINANCIAL SERVICES

18 CABLE & WIRELESS

19 CAYMAN ISLANDS SOTHEBY’S INTERNATIONAL REALTY

20 WESTSTAR TV LIMITED

23 THE BURNS CONOLLY GROUP

24 ERNST & YOUNG

26 CLOSE BROTHERS (CAYMAN) LIMITED

28 WESTTEL

29 KROLL (CAYMAN) LIMITED

30 CLICO (CAYMAN) LIMITED

31 THE WATER AUTHORITY – CAYMAN

32 CRUSADER INTERNATIONAL MANAGEMENT (CAYMAN) LTD.

32 ARCP (ADVANCED ROAD CONSTRUCTION & PAVING)

33 CAYMAN AIRWAYS

34 CAYMAN STYLE LIMITED

34 KENSINGTON MANAGEMENT GROUP LIMITED

35 CAYMAN ISLANDS INVESTMENT BUREAU

ERNST & YOUNGBACK COVER

A SPECIAL ADVERTORIAL

SUPPLEMENT OF

GRAND CAYMAN MAGAZINE

P U B L I S H E R S

EDITOR IN CHIEF

David R. Legge

ADVERTISING SALES DIRECTOR

Vicki L. Legge

ART DIRECTOR

Richard Aldama

PHOTOGRAPHY

Art Pasquali

Courtney Platt

ACCOUNT EXECUTIVES

Kate Copley Allenger

Sue Thomas

ADVERTISING SALES

Pinnacle Publishing & Marketing Ltd.

© 2007, Pinnacle Puiblishing & Marketing Ltd.

All rights reserved. Reproduction in all or in part

without prior written permission is prohibited.

Printed in Canada.

PUBLISHED BY

Pinnacle Publishing & Marketing Ltd.,

P.O. Box 31368, Seven Mile Beach,

Grand Cayman, Cayman Islands.

Phone: 345-945-6566

Facsimile: 345-945-6599

Website: www.grandcaymanmagazine.com

E-mail: info@grandcaymanmagazine.com

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Cayman Business: An OverviewF U T U R E C H A L L E N G E S , F U T U R E O P P O R T U N I T I E S

Ah, if only the morning knew what the afternoonunderstands.

The desire to foretell the future has been a theme thatbegins in the Bible (Adam and Eve were warned not to eatthe fruit of the Tree of Knowledge), threads its waythrough Elizabethan times (in The Tragical History ofDoctor Faustus, playwright Christopher Marlowe tells thetale of Doctor Faustus who pledged his soul to the devilin return for divine knowledge), and finds its way to mod-ern times in the Broadway musical comedy, “DamnYankees” (the hero, Joe Hardy, makes a bargain with satan

and trades his soul for the certain-ty that his favorite team, theWashington Senators, would winthe World Series).

Very dangerous stuff, thistelling of the future.

And yet, most of us cannotresist the notion that if we knewwhat was to happen tomorrow,we could take action today toinfluence its outcome. Such fore-knowledge is the basis of allstrategic planning, risk assess-ment, and business and economicforecasting. Unfortunately, thefuture often doesn’t convenientlypresent itself as a linear extensionof today.

Unexpected events (recallHurricane Ivan) have a way of dis-

rupting our best-laid plans and predictions. Put anotherway, it’s most often “the unseen devils that get us.”

Nevertheless, having acknowledged those caveats, wewould offer in this Special Supplement, a broad-brushlook at what the Cayman Islands might look like in theyears ahead.

Our reporters talked to key leaders and experts inCayman’s two primary industries, Tourism (Page 8) andFinancial Services (Page 16) to examine the status quo andglean future trends. In addition, some participating adver-tisers share, in their own words, what they foresee for theirown companies as Cayman moves further into the 21stCentury.

In this “Overview,” we will examine a few of the “fun-damentals” that are likely to shape our future in theseislands—for better or worse.

—

EDUCATIONPerhaps education is the most intractable issue theCayman Islands face. The two major private sector indus-tries—financial services and tourism—each require well-educated workforces, and the schools, simply put, are not

preparing young people to participate at high levels inthese industries.

Despite government’s generous annual spending perpupil (possibly the highest in the world) in grades K-12,the results are unacceptable. In a knowledge-based econ-omy that requires not just college degrees but advanced-level degrees in law, accounting, and business administra-tion, only about 5 percent of high school graduates go onto four-year universities. Obviously, capital inputs havenot equaled cognitive outputs.

The University College of the Cayman Islands (UCCI),Cayman’s highest level educational institution, has beenneglected for years and is starving for funds. This year, theschool will receive just over $2 million in operating fundsfrom the government. Tellingly, the Truman BoddenSports Stadium, right next door to UCCI, will receive morethan that for renovations! (Even worse, for comparativepurposes, Boatswain Beach, formerly known as the TurtleFarm, cost more than $50 million to build and, as of thiswriting at mid-year in 2007, has required additional oper-ating subsidies of more than $6 million. Something is seri-ously askew with our priorities here.)

Unless and until the Cayman Islands commit, attitudi-nally as well as financially, to turning out highly educated,highly motivated, Caymanian graduates, the dividebetween imported “expatriate labor” and an ill-educatedunderclass of Caymanian youth will continue to expand.

REAL ESTATE AND DEVELOPMENTThe next five years will continue to see our island remakingitself physically. The opening phases of Camana Bay maywell shift the locus of the island from downtown GeorgeTown, which suffers during the day from traffic jams, lack ofparking, and pedestrian congestion from hordes of cruise-ship passengers clogging our main artery, Harbour Drive.

The impact of the massive long-term investments madeby the Dart family in Camana Bay and other Cayman busi-nesses cannot be overestimated: They will fundamentallyalter the urbanscape and, ultimately, we believe, raise thestandard in virtually every sector they enter. Along withchange, they bring quality and excellence to their projects.

Grand Harbour, another planned community (albeit ona smaller scale than Camana Bay), includes luxury homes,canals, recreational facilities, a professional center, and ashopping center. This 200-acre “mixed use” developmentin Prospect is offering Cayman residents and businesses aserious alternative to situating in downtown George Townor along the busy Seven Mile Beach corridor.

While the “Go East” campaign is more of a slogan thana policy, the island still has large undeveloped tracts ofland, much of it facing the sea, that appear more and moredesirable, since Seven Mile Beach, for the most part, is“sold out” in terms of land for condominium and resort

THE FUTURE OF THE CAYMAN ISLANDSBy David R. Legge

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development. Many eyes are on the“Residences at Beach Bay” in BoddenTown to see if that luxury project is abellwether that $2 million-plus con-dominiums are marketable to buyerswho, traditionally, have bought onlyon Seven Mile Beach.

A name to watch for in the com-ing years is Stan Thomas, founder andCEO of Thomas Enterprises, a mega-development company headquarteredin Atlanta. Thomas, who has a verygood reputation in the industry, is buy-ing up and banking huge tracts of land(hundreds and hundreds of acres) offWest Bay Road. Although Thomas hasyet to reveal his intentions, it is likelyhe will bring additional “five-star”resorts, golf courses, and residentialcommunities to the island.

TELECOMMUNICATIONS

AND MEDIAThe trend in these sectors is clear:more for less. Since 1965, whenGrand Cayman had fewer than a half-dozen telephones, the explosion incommunication technology has beenmeteoric and has enabled the growthof our major industries. Cable &Wireless invested hundreds of mil-lions of dollars in “wiring” theCayman Islands to the world, and

The retail market in Grand Cayman will basically subdivideinto two separate venues: downtown George Town,which will continue to cater to cruise ship passengers, andthe wealthy Seven Mile Beach corridor, now anchored bythe Ritz-Carlton resort and the future site of Camana Bay.

PHOTO BY COURTNEY PLATT

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WestStar TV has brought the worldinto our living rooms.

Today, of course, because ofchanges in the telecommunicationsregulatory regime, we see well-financed carriers, including Digicel,WestTel, and TeleCayman, competingaggressively with Cable & Wireless formarket share. Importantly, broadbandspeed continues to increase and pricecontinues to fall. Such readily availableservices as Wi-Fi (eventually to besuperseded by WiMAX), VoIP, telecon-ferencing, and, in particular, digitalmobile service are remaking the com-munications industry business model.

The availability of these technolo-gies will have far-reaching implica-tions for the way business is conduct-ed in the Cayman Islands, particularlyin the “knowledge” professions, suchas law and accounting.

These sectors incur enormouscosts in attracting top professionals(themselves in increasingly short sup-ply) to the Cayman Islands.Recruitment costs, work permit fees,relocation costs, as well as high salariesand low retention rates have managingdirectors searching for lower-cost alter-natives than actually “bringing the bod-ies” to Grand Cayman.

Their answer, of course, is to out-source “back office” work to lower-costjurisdictions, such as India, and passwork back and forth to these outpostsdigitally via the high-speed Internet.

Hurricane Ivan accelerated thelearning of this lesson: A number oflarge firms, Ernst & Young perhapsbeing the most prominent, becameseamlessly “full-service” within 24hours after the storm. Working out ofmakeshift offices in an Atlanta hoteland the Ernst & Young offices inBermuda, Cayman staff communicat-ed with their global clients who, for

the most part, were noteven aware that Caymanhad been devastated bythe storm. Technologyenabled this new model ofdoing business, andCayman will participate toa much greater degree in

the coming years in this communica-tions revolution.

THE RETAIL SECTORKirk Freeport, owned by theKirkconnell family, has long set thestandard for upscale retail boutiquesand luxury products in the CaymanIslands. The Kirkconnells realized earlyon that shopping for name brand luxu-ry items, such as Rolex watches, wasitself a “tourist attraction.” Importantly,Gerry Kirkconnell, who manages thefamily’s retail operations, made anenormous investment in opening thegrand Bayshore Mall on the waterfront.It was a bold confident move that posi-tioned Kirk Freeport well in this marketfor the foreseeable future.

Other companies, however—mostnotably Island Companies which hasbeen purchased, in part, by the Dartorganization—are aggressively expand-ing their brands—and their outlets—both downtown and elsewhere. As partof its “vertical integration,” IslandCompanies stores will have a large pres-ence in the Dart-owned Camana Bay.

On a smaller but still significantscale, Magnum Jewelry continues toexpand its upscale boutiques andcaters to an enviable portion of theupscale market. Likewise, well-respect-ed Balaclava Jewelers has announcedthat it is moving to a posh new locationat Governor’s Square, oppositeGovernment House on West Bay Road.

In building Governor’s Square, well-known businessman Bobby Bodden hasbrought a new standard of quality con-struction, coupled with an ideal location,to the Seven Mile Beach corridor. Thecomplex, which is almost entirely leasedout, will be home to restaurants, busi-nesses, and retail outlets.

Looking into our crystal balls, wewould wager that within the next half-

dozen years, the retail market in GrandCayman will basically subdivide intotwo separate venues: downtownGeorge Town, which will continue tocater to cruise ship passengers, and thewealthy Seven Mile Beach corridor, nowanchored by the Ritz-Carlton resort.

Expect to see redevelopment ofCayman’s aging “shopping malls,”such as West Shore Center, theGalleria, and The Strand. All will go“upscale” and will be populated byluxury-brand boutiques to attractsophisticated, well-traveled visitors.

The first developer to put in anultra-upscale shopping destination,similar to Bal Harbour north of Miami,we believe, will do extremely well.

—God was good to the Cayman Islands.While He didn’t endow these shoreswith either fertile land or mineralresources, we are surrounded bystunningly beautiful seas and sand,which, as long as the island remainssafe and secure, will continue toattract visitors. Our proximity to theUnited States makes travel in eitherdirection simple—an enormous, butlargely unexploited, asset. Many inAmerica—potential visitors—areunaware that, in travel time, we’re lit-tle more than a “suburb” of Miami.

Likewise, our infrastructure ismodern, comfortable, and inviting.This bodes well for our tourism andfinancial industries. The reasons for ourdecline in “stayover tourism” in recentyears are largely man-made and policy-driven—and, therefore, reversible.

Despite the current government’salarming capital spending binge andballooning operating budget, the fun-damentals of Cayman’s economyremain strong and investor confi-dence remains high.

If the country can come togeth-er—putting its partisan voices aside—on a national mission to resolve itseducation issues and begin to preparethe next generations of Caymaniansto be more than bystanders in theeconomy of their home country, thenthe future of the Cayman Islands maybe very bright indeed. ❂

Recruitment costs, work permit fees, relocationcosts, as well as high salaries and low retentionrates have managing directors searching for lower-cost alternatives than actually “bringing the bodies” to Grand Cayman.

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The water available in most of the hotels and condominiums on Grand Cayman is supplied to the highest international standards byConsolidated Water Co. Ltd. and is safe and clean. Enjoy your stay andhave a drink on us... right from the tap! But remember you are using ascarce and expensive commodity. PLEASE CONSERVE WATER.And ifyou’re tired of T-shirts but want a permanent reminder of your trip,ask your financial advisor about “CWCO” when you get home.

Consolidated Water Co. Ltd.P.O. Box 1114, Grand Cayman KY1-1102

Cayman Islandswww.cwco.com

Quoted on the NASDAQ Global Select Market as “CWCO”

CAN I DRINK THE WATER? YES YOU CAN!

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Cayman Business: Tourism F U T U R E C H A L L E N G E S , F U T U R E O P P O R T U N I T I E S

Although never quite as lucrative as the financial servicessector, the Cayman Islands’ tourism industry has played akey role in the country’s economic fortunes, as well asdefining Cayman for some five decades.

From the late 1950s, when Bob Soto pioneered the con-cept of diving vacations, to the development of high-endhotels and vacation rentals along Seven Mile Beach, Caymanhas proved a popular destination for the well-to-do.

Although tourism remains a vibrant industry, there area number of pressing issues to consider. Many profession-als working in the business believe that “Brand Cayman”needs to be more distinctly defined, and a collective pushfrom the industry and government is required to put thetourist ship back on course.

The negative impact of Hurricane Ivan in September2004 can never be underestimated, and while our infra-structural recovery was significant, the storm served as anunfortunate reminder to the traveling public that this coun-try is situated in a risky, albeit beautiful, geographical loca-tion, and stayover visitor figures have never fully recovered.

However, overnight arrivals were already beginning todecline from their peak in 2000, before Ivan had GrandCayman in its sights.

The battle between overnight guests and cruise pas-sengers; the competition from other countries around theCaribbean and other external forces; the choice of mar-keting and promotional work by the Ministry of Tourismand the Department of Tourism; and perceptions ofoverdevelopment have combined to, if nothing else, firesome warning shots across our bows.

An overall view of the sector still reveals many posi-tive aspects. From the opening of the Ritz-Carlton and thepromise of more five-star resorts to come to the introduc-tion of a direct flight to John F. Kennedy Airport in NewYork, there is much to be welcomed.

The re-development of the Owen Roberts InternationalAirport, a greater focus on areas outside of Seven Mile Beachwith the “Go East” initiative, designed to develop the touristproduct in the outer districts, also bode well for the future.

The expansion of Boatswain Beach (formerly knownas the “Turtle Farm”) and the renovation of Pedro’s Castleare also encouraging.

Those involved in the sector, however, still warn ofpotential challenges. The global tourism market, for exam-ple, has expanded over the years, making it easier for peo-ple to travel to other exotic places besides the Caribbean.Karie Bergstrom, President of the Cayman Islands TouristAssociation (CITA), says competition is already a pressingconsideration and, with the potential development ofCuba over the next decade, regional competition, in par-ticular, will be a force to be reckoned with.

“Any potential emerging market that could competewith the Cayman Islands poses a threat to our industry,”says Bergstrom. “I recall this being a concern since I wasa child, the idea that Cuba will open up. The majority ofour visitors come from the United States, and this is thecurrent market that is restricted from visiting Cuba, so I dobelieve we will have a challenge if and when Cuba is opento U.S. visitors.”

However, as has been cited elsewhere, Cuba couldalso offer a potential opportunity. If the situation is wellmanaged, Bergstrom says that Cayman could capitalize onthe additional attention on the region.

Aside from competition, the outside world can under-mine tourist destinations in many ways. Terrorist attacks,regional conflicts, and international regulations can allhave a detrimental impact on a product. For example, therecent introduction of the Western Hemisphere TravelInitiative, which mandates that all U.S. citizens must nowtravel with a passport regardless of their destination, offersup an external problem that we can do little about except

THE FUTURE OF ‘BRAND CAYMAN’

From the opening of the Ritz-Carltonand the promise of more five-star

resorts to come to the introductionof a direct flight to John F. KennedyAirport in New York, there is much

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educate potential guests and hopethat they will not be deterred. (Atpresstime, the United States was tem-porarily relaxing those passportrequirements until its own StateDepartment can catch up with itsbacklog of applications.)

With numerous external variablesto contend with, it is all the moreimportant that we manage the thingswe do control properly. Bergstromwarns that the cost of doing businessand immigration issues pose furtherconcerns.

“The local tourism industry hassuffered as have other businesseswith the high increases in the costof fuel, utilities, freight, and such,”she says.

“It has also adversely affectedour ability to attract talent to theindustry, as the cost of living is toohigh and there is no guarantee oftenure based on the new immigrationterm limits. It has been reported thatsome of our restaurant members

have lost close to 60 percent of theirstaff due to economic factors and tothe term limits.”

The balance between cruisetourism and overnight guests alsopresents a conflict for the industry.

The proposed development of adry dock in George Town Harbor andthe scheduling of ever-larger cruiseships will see more passengers com-ing ashore.

The opening of themed restaurantssuch as Hard Rock Café, Margaritaville,and, if the marl road is to be believed,the possible arrival of a “Hooters,” willcontinue to change the face of thedowntown area as local businessesturn their attention to catering to thecruise trade.

A number of those working in thebusiness say it is difficult to reconcilewhat appears to be the emergence oftwo tourism products. The Ritz-Carltonat one end of Seven Mile Beach andHooters at the other certainly offers aninteresting contradiction.

Of course, defendants of the lucra-tive cruise business point to its contribu-tion to maintaining the country’s touristproduct in the wake of Hurricane Ivan.

Yet there must be a balance. It isself-evident that the Ritz-Carlton guestor the consummate dive enthusiastmay not desire the same thing from adestination as a cruise passenger whopasses through for a few hours.

Bergstrom says that strides arebeing made in balancing the two, butthere is work to be done.

She believes that misinformationabout the impact of tourism on asmall country ends up creating poli-cies that are not necessarily sustain-able in the long term.

“It is important for policymakersto consider the tourism industry as awhole before implementing policiesthat negatively impact one sector overanother,” she notes.

“The recent initiative by theMinistry of Tourism to update theNational Management Tourism Policy

Beautiful natural resources, from the powdery white sands of Seven Mile Beach(facing page) to the craggy ‘ironshore’ formations at Smith’s Cove (above),

will continue to attract visitors to our shores.

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should allow this to happen.However, the recommendations needto be followed and implemented.”

The new policy was recentlydescribed by the Minister of Tourism,the Hon. Charles Clifford, as providinga policy framework for all tourismdevelopment in the Cayman Islands.He said it would cover such things asproviding a high-quality product for thevisitor, presenting a distinctiveCaymanian experience, adopting a sus-tainable approach, protecting andenhancing the environment, andattracting a more discerning and higherspending visitor, among many others.

Therefore, how we market anddefine “Brand Cayman” is important,and two recent deals by theDepartment of Tourism reflect thestruggle to define who we are. A three-year $2.1 million partnership with theNational Football League and the spon-sorship of the 2007 Houston Polo Clubseason suggest we are trying to sellCayman to very different audiences.

Representatives from other sec-tors are also raising concerns. One

prominent realtor recently cited a fail-ure of government policy to focus onovernight tourists, who naturallyspend more than cruise shippers, asundermining the resort real estatemarket as well.

Bergstrom believes that criticismof the marketing strategies fails toappreciate the major efforts made bythe industry players as well as gov-ernment, but notes that marketingmust give value for money.

“The private sector is continuous-ly marketing these islands throughtheir own efforts. Of course, wewould like to see more funds budget-ed for direct marketing efforts. Thebudget has not increased over thepast three years, yet the value of eachmarketing dollar spent has declined,so we are getting less mileage for themoney allotted.”

Another new buzzword in thetourism business is “diversity,” andexperts warn of the potential dangersof promoting gimmicks.

Cayman has made attempts in thepast to consider a more diversified

target market with little success andhas stuck, in general, to its historicpositioning.

“Our tourism pioneers saw themarket for what it should be manyyears ago, and we are fortunate thatwe have not strayed too far awayfrom it,” says Bergstrom.

“We need to focus on the visitorsthat can afford our destination andare willing to come here and bringtheir families to a safe and peacefuldestination.”

In the end, Cayman is still agreat place to take a vacation, withgood restaurants, beautiful beaches,and some of the best diving in theworld—all in a secure environment.However, we must beware of under-mining the high-end tourist productwe have created.

If we are to attract and, moreimportantly, retain the discerningtraveler, we must protect not just thebeauty of Cayman but its integrity aswell. If we do, we shall continue toenjoy the rewards the industry hasgenerated for some 50 years. ❂

In the end, Cayman is still agreat place to take a vacation,with good restaurants, beautiful beaches, and some ofthe best diving in the world—all in a secure environment.

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SOUTH REACH • THE ESTATES • THE ISLES • THE CAREENAGE

PROFESSIONAL VILLAGE • THE SHOPPES AT GRAND HARBOUR

SURF & SKATE PARK • THE MARINA

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Grand H

arbour • Caym

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After more than a decade of development, the planned community of Grand Harbour is

reaching its full potential as a beautiful place to live, work, play, and shop.

Grand Harbour is the vision of developer Michael Bell who in the early 1990s envisaged an

integrated community on the East Side of George Town which would provide all of the services and

amenities that active residents, professionals, and business owners desire, demand—and deserve!

Although “planned towns” or communities (such as Hilton Head, South Carolina, and

Celebration and Seaside, Florida) have become somewhat commonplace in the United States and

throughout Europe, they are a new phenomenon in the Cayman Islands with Grand Harbour and

Camana Bay leading the way. They offer a lifestyle that is unsurpassed in terms of luxury, security,

and convenience.

THE EARLY YEARSWhen Michael Bell arrived in GrandCayman in the early 1990s from CleburneCounty, Alabama, where he had beenworking as a civil engineer, he worked fora short stint as a surveyor before becominginvolved in a partnership that, ultimately,would result in the building of GrandHarbour.

Bell began to acquire plots of landjust inland from the tranquil NorthSound. Eventually Bell would connecteach of his parcels of land to the sea via abeautiful navigable canal.

When Bell had assembled his “criticalmass” of land—nearly 200 acres—he tookan innovative, albeit expensive, approachto preparing the land for development.

Instead of placing marl or fill on topof the marshy or peat-like wetlands—themore common method of readying landhere—Bell took the unconventional

approach of clearing the entire site of marsh all the way downto the natural bedrock, where he then laid the marl.

During that process, the peat and the wet earth that hadbeen removed were saved (minus the larger pieces which wereremoved). Over the period of excavation, through a processof drying and mulching, the concoction was transformed intotopsoil that was then laid on the marl.

Jeremy Hurst, President and Broker/Owner of IRG,who has been closely involved with the development almostsince its inception, said, “At one point, Michael Bell’s soilmountain was one of the highest points on the Island!”

The landscape of the residential site is both natural inappearance but solid, cutting down on the cost of creatingfoundations for those constructing homes on the lots. Thetechnique has also made for a cleaner and greener lookingsite.

Although Grand Harbour was designed to be built andsold in stages, Bell opted to “write the big check” and exca-vate the entire 198 acre site in one go. It was a commitmentand vote of confidence in his investment and the communityhe was about to create.

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SOUTH REACH

The first housing community, South Reach, went on sale in

2004—and broke all records. The neighborhood stretches

from behind the Shoppes all the way to the North Sound

and became the fastest selling development in

Cayman—90 percent of the lots were sold in the first

two years!

Ranging from 12,500 to 18,000 square feet,

each lot has its own integral cantilevered dock.

Many homes of varying form and character

are now emerging on these sites, and

boats are appearing along the all-

weather docks as the new neighborhood

comes to life.

THE CAREENAGE

The first phase of the

“Careenage,” which is

already sold out, is also completed and

awaiting its first occupants. This is Grand

Harbour’s first apartment complex, with

one-, two- and three-bedroom units in

three-storey, brightly colored buildings over-

looking the canal. Eventually these beauti-

fully crafted homes, designed by famed

architect John Doak, will overlook a

neighborhood

marina.

THE ISLES

The Isles, which have

only recently gone on

the market, have

been selling

extremely well—and it’s no wonder!

These lots offer a slab-height of eight feet above sea level and

are situated on their own private island. Ranging from 13,000 to more

than 20,000 square feet, each has its own private dock.

THE ESTATES

The Estates, which will soon go on the market, are the largest prepared

sites at Grand Harbour, ranging from more than 17,000 to 25,000

square feet. Like The Isles, The Estates are situated on a private island,

and residents will approach the neighborhood via a bridged

entrance. Each lot is elevated with 150 feet of canal

frontage, again with private dock and extra space

for a boathouse—a must for the discerning

modern mariner.

For more information, please contact

INTERNATIONAL REALTY GROUP LTD.

at (345) 623-1111.

Once the land clearance was com-plete, Bell was able to break ground onthe first section of the development inthe late 1990s, one that is now veryfamiliar to residents and many visitors toGrand Cayman as well.

SHOPPING AND RECREATIONThe Shoppes at Grand Harbour arehome to Hurley’s Marketplace (one ofthe most-modern supermarkets in GrandCayman), Hobbies and Books,HealthCare Pharmacy, Blackbeard’sRum Company, and other leading localretailers, as well as a fashionable restau-rant and bar, now trading as the Galleyand Davy Jones Sports Locker.

Recently the fabulous skateboardand water park opened, both of whichhave proved immensely popular withlocals and tourists.

The creation of the shopping areahas given Grand Harbour a solid identityand character of its own, and now the res-idential neighborhood is beginning totake on the shape of a real community.

THE RESIDENTIAL COMMUNITYAlthough design concepts for GrandHarbour have evolved since their earlybeginnings, the overall concept forGrand Harbour as an integrated residen-tial and commercial community remainsunchanged. The construction of mar-velous homes and the ongoing arrival ofneighbors is an important milestone inthe Grand Harbour story, since it is theresidents who will define the future ofthe community.

Once a lot has been purchased, buy-ers are free to design and develop theirown homes on their land. This hasresulted in a variety of styles of resi-dences, preventing the neighborhoodsfrom becoming uniform, or “cookie-cutter,” in appearance.

There are guidelines, of course, with-in the covenant that will help to maintainthe overall aesthetics of Grand Harbour,but, importantly, the covenant has beenguided by principles of functionality andquality—rather than merely restriction.

G R A N D H A R B O U R N E I G H B O R H O O D S

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The goal is to ensure that thoseinvesting in the lots are free to create astylish home of their own choosingwhile maintaining the overall beauty ofthe community:

“We want everyone to be able toenjoy the peace and harmony of thiscommunity, so the covenant has beenformed to protect all the residents’ inter-ests,” said Hurst.

The flexibility of the covenant isalready becoming apparent through theemergence of different properties, fromthe waterfront condominiums to the pil-lared luxury family homes—evident in arange of colors and sizes.

The residential lots at GrandHarbour have been divided, by size, intothree different neighborhoods, knownas “South Reach,” “The Isles,” and“The Estates.”

All residential lots face the meander-ing canals which were constructed with aEuropean freeform water system that iswide and deep, allowing for larger boatsas well as spectacular water views.

The keystone seawall system, whichhas been used to bulkhead the canals, isstrong, durable, and stable. Importantly,it employs non-corrosive interlockingconcrete products and, therefore, isenvironmentally friendly as well asweather resistant.

Of primary concern to Bell was theability of the home sites to withstandhurricane conditions, including storm

surge. Toward that end, every lot hasbeen “crested” so that water will run offthe site and not collect on the propertyduring extreme weather conditions.

COMMERCIAL DEVELOPMENTSAs the residential sites blossom intocommunities and homes, the remainingcommercial developments in GrandHarbour are also well under way.

The Professional Village is unique inCayman, as it is a condo-style office devel-opment in which professionals and smallbusiness owners, from lawyers to realtors,can buy their own business premises.

Rent is one of the biggest overheadsfor any business owner, and this newdevelopment offers a way to invest thecash that is normally paid to a landlordinto an asset for the business.

As Grand Harbour has alreadyproven itself to be an attractive and pop-ular shopping area, anyone investing inoffice premises can be assured that theyhave chosen a prime location fromwhich to operate their business.Moreover, as the community continuesto grow, there will be many more peopleliving and working in the neighborhoodbringing local purchase power and ademand for services of all kinds.

And that’s not all! For those whowish to build their own office or unit,Grand Harbour will soon be offeringlots for sale for professional/commercialdevelopment. “These units will be ideal

for medical practices, veterinarians, orother enterprises that require uniquelydesigned accommodation for their spe-cific types of business,” Hurst said.

In addition, lots will soon be avail-able for purchase or lease in an excitingnew Commercial Marine Development,which will be attractive to residents,boating enthusiasts, and the overalltourism industry.

—Already tested in Hurricane Ivan,

Grand Harbour was virtually unscathedcompared to the surrounding area, andthose who were on the Island willremember how soon Hurley’s andCastaways Restaurant were open in theaftermath of the storm. Within two days,Castaways was serving hot meals, andHurley’s was selling groceries to thou-sands on the Island.

As the Cayman Islands continuetheir economic success, the growth oflocal businesses, as well as the demandfor beautiful waterfront homes, willensure that Grand Harbour will contin-ue to be one of the most desirable choic-es in Grand Cayman.

As a well-situated popular locationthat has already proven itself as an attrac-tive hub of activity, Grand Harbour,with its reef-protective, rock solid foun-dation, is becoming Cayman’s first com-plete planned mixed-use community.Above all, Grand Harbour is a “grandplace” to live or work.

CIREBA MEMBER

For More Information Please Contact:INTERNATIONAL REALTY GROUP LTD.(345) 623-1111 • Fax (345) 623-1112Artillery Court • Shedden Road • George Town • irg@candw.ky • www.irg.ky

THE CAREENAGE

The creation of the shopping and recreationarea has given Grand Harbour a solid identity and character of its own, and nowthe residential neighborhood is beginning totake on the shape of a real community.

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Cayman Business: Financial Services F U T U R E C H A L L E N G E S , F U T U R E O P P O R T U N I T I E S

Even 13 years after the release of the blockbuster film “TheFirm,” the Cayman Islands have not been able to shake offtheir image as a center for money laundering and tax evasion.

But the reality of this sun-drenched British OverseasTerritory is far different from the illusion of a money-laun-dering haven. In reality, the Cayman Islands is a Cinderellastory that transformed a small island population of 8,500,eking out a living by fishing or seafaring, into a sophisti-cated financial center and luxury destination with six timesthe population. So, what has driven this success?

The roots of Cayman’s financial sector go back to theearly 1960s. At the time, the Bahamas was the dominantfigure in offshore banking and finance, while these threesmall islands were fairly isolated, with few telephones,cars, no airport, and Barclays as the lone bank.

As the Cayman Islands began taking their first tenta-tive steps in building its own offshore banking center, apolitically significant event occurred in the Caribbean thatkick-started this burgeoning industry.

The Bahamas became independent from the UnitedKingdom and, in a move to reserve high-paying jobs forBahamians, they began refusing work permits to foreignlawyers, bankers, and accountants, who made up a largepart of the workforce in the financial sector.

Many of those same bankers, lawyers, and account-

ants got on a plane and came to this immigration-friendly

country, bringing their experience and clients with them.

“The clients just came, and we gave them great

service,” said William S. Walker, who founded top law firm

Walkers. “There was a lot of cooperation between the

expats and Caymanians and word got around.”

Legislation in banking, trusts, insurance, and the ship-

ping registry formed the legal foundation for the offshore

finance center. Then in the 1970s, the assassination of

Bermuda’s governor and ill-advised regulatory decisions

accelerated the captive insurance market in Cayman. Today, Cayman’s financial sector is the cornerstone of

the economy. It is especially known for its cutting-edgefinancial products that cater to a broad range of needs,from over-caffeinated investment managers in London

seeking higher returns, to emerging markets in Asia andthe Middle East and the growing demand to manage thespiraling costs of insurance.

Integral to Cayman’s success is not tax evasion ormoney laundering, as commonly misperceived, but thecombination of knowledgeable professionals, stable gov-ernment, and strong regulations that instill confidence thatinvestors’ funds are secure.

“The Cayman Islands were among the first in theworld to make laundering the proceeds of all seriouscrimes a criminal offense, going beyond just drug moneylaundering,” says Eduardo D’Angelo Silva, director of theCayman Islands Financial Services Association.

BANKINGCayman is among top tier of the international bankingcenters. The banking sector has $1.4 trillion booked in slight-ly fewer than 300 registered banks. It also has 45 of theworld’s top 50 banks holding a Cayman Islands bankinglicense—one of the most sought after banking vehicles inter-nationally.

Some of the benefits of operating a Cayman Islandsoffshore bank include the absence of taxes on bank trans-fers and no exchange controls. There are also no proper-ty, capital gains, or income taxes in the Cayman Islands.

In the last few years, numerous banks have boughtother banks or merged, which has led to consolidationsfrom more than 500 to fewer than 300 banks today, thoughtotal assets have continued to climb.

INVESTMENT FUNDS The crown jewel of the financial sector’s recent success isthe exponential growth of hedge funds. With more than8,500 registered funds, primarily hedge funds, industryexperts estimate that Cayman holds 70 to 80 percent of theworld’s market, accounting for $2.4 trillion, although, froma practical standpoint, the daily trading is done by invest-ment managers working in New York, London, and HongKong where most of the activity occurs.

Because many of these hedge funds pool capital fromtwo or more countries with different tax regimes and reg-ulations, Cayman is applauded for its efficiency and quickturnaround time.

“If you want to put a deal together that involves majorplayers in different regulatory regimes, Cayman can giveyou a tax neutral base to do that,” said former regulatorPaul Byles, adding that in the 14 years since hedge fundshave been offered, there have been few major newswor-thy incidents resulting from negligence. “That is amazing,because in the onshore world, these incidences are occur-ring every day.”

With the high profile fallout of Bayou Group hedgefunds, as well as other corporate scandals such as Enron

BUILDING ON THE SECTOR’S STRENGTHS

Integral to Cayman’s success is not tax evasion or money laundering, as commonly misperceived, but the

combination of knowledgeable professionals, stable government,

and strong regulations that instill confidence that

investors’ funds are secure.

By Shurna Robbins

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and WorldCom, there is an increasedemphasis on corporate governance.This has lead to a growing demandfor independent directors for hedgefunds, which ensures best practicesare in place.

Another investment product that isattracting enormous capital is privateequity funds. By their very nature, pri-vate equity funds are not publicly list-ed or registered so no one knows forsure just how big this market actuallyis, but part of the attraction is they pro-vide maximum privacy and flexibilityas an investment vehicle.

CAPTIVE INSURANCE “Captive insurance” is an industry termfor self-insurance. The compelling rea-son to form a captive is to bring downthe overall cost of insurance coverage,with companies saving hundred ofthousands, and frequently millions, ofdollars in premiums over traditionalinsurance by managing their own risk.

It is a booming market, especial-ly in the United States with escalatingpremiums in every insurance type. Inthe wake of Hurricanes Katrina andRita, buying certain types of propertyand flood insurance at any price maybe difficult, if not impossible.

“Most of our clients form a captive

insurance company in Cayman due to

a few fundamental reasons, such as

the cost or availability of alternative

commercial insurance coverage, the

ability to write coverage to the client’s

needs, and a prudent and practical

regulatory approach to the business

case,” said Chairman of the Insurance

Managers Association, Dan MacLean.Bermuda has been known as the

number one jurisdiction for captives,while the Cayman Islands was regard-ed as hovering in that island’s shadow.However, in recent years things havechanged, and for the last few years, thisjurisdiction has been hot on its heelswith $30 billion in managed assets in740 captive insurance companies.

But where Cayman has really

made its name has been in healthcare

captives, which make up 40 percent

of the 740 captives.

SHIPPING REGISTRYWith a rich seafaring tradition, theCayman Islands Shipping Registry,which adheres to strict internationalstandards, is a natural location to reg-ister vessels. Founded more than 100years ago, the Shipping Registry has

developed into a global organization,registering commercial ships acrossthe full spectrum, with offices in theUnited Kingdom, The Netherlands,Greece, and Japan.

Currently there are more than1,600 vessels registered, and it hasbecome the largest super yacht reg-istry in the world.

AIRCRAFT REGISTRYOn the surface, it may not appear to bebeneficial to register an airplane or pri-vate jet with an offshore center, but asAmericans and other high profilenationalities are targeted for kidnappingand acts of terrorism, it makes sense tofly a plane using the lower-profileCayman flag. More than 130 aircraft areregistered in the Cayman Islands.

The Aircraft Registry has only fivehelicopters on its rolls, but expertspredict that demand will grow, espe-cially with mega-yachts being fittedwith helipads.

CHALLENGESAny long-term success is not withoutits challenges. Since offshore centersare often viewed as diverting tax rev-enue from the public coffers fromhigh tax jurisdictions, there is growingpressure to curtail their activities.

In February, United States senatorsproposed legislation—the “Stop TaxHaven Act”—designed to close theloopholes in an estimated US$100 bil-lion lost in tax revenue each yearthrough tax evasion. Another move inJune was a call by the U.S. lawmakersto examine a top Cayman law firm tocatch U.S. tax dodgers. These initiativescome in spite of a Tax InformationExchange Treaty with the UnitedStates, as well as increasing regulationthat combats tax evasion, money laun-dering and terrorist finance that is con-sidered stricter than U.S. standards.

“The Cayman Islands and small

international financial centers have

been wrestling with the alphabet

soup of international initiatives for

some time,” said the Chairman of the

Monetary Authority, Timothy Ridley.

“Acronyms like EUSD, FATF, IMF,

IOSCO, and OECD roll off the

tongue. Despite these, many interna-

tional financial centers have thrived.”The other challenge is the world-

wide shortage of skilled labor to sup-port the financial services industry.The cost of living and doing businessin Cayman is high. Much of the work-

force must be recruited from abroadand Cayman competes with othercountries for skilled workers.

Exasperating this shortage isrecent legislation that limits work per-mits to foreigners to seven years. Ifnot managed correctly, expertsbelieve this legislation could sparksomething similar to what occurred inThe Bahamas, driving a critical massof skilled workers to other offshorecenters with immigration-friendlypolicies.

CRYSTAL BALLSo what do the next few years looklike for Cayman’s financial sector?Industry experts predict that captiveswill catch up to Bermuda.

Hedge funds are expected to con-tinue their exceptional growth rate,but as more competitors enter thiscrowded market, there will be down-ward pressure on rates of returns.This will lead investment managers tolook beyond North America andEurope, and beyond emerging mar-kets in China, India and Dubai.

Countries which will attract

investment in the next few years are

just beginning to stabilize politically

and socially—requisites for investor

confidence—in regions as diverse as

Africa, the Middle East and Latin

America. All of these nations are in

need of massive international invest-

ment to build up their telecommuni-

cations, power, water processing,

roads and other infrastructure.Super funds of $1 billion or more

will become commonplace. As hedgefunds and private equity expand intooverlapping areas, there will be aconvergence of these two products.

At the same time, the reality ofglobalization will lead to greater inter-national cooperation between coun-tries onshore and offshore to fightmoney-laundering, terrorist financing,and tax evasion. ❂

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The telecommunications sector is one of the world’s fastestmoving industries and after forty years serving the CaymanIslands, Cable & Wireless, the only full service provider, is morethan ready to face all the exciting challenges that lie ahead.

Overall, the industry has been driven by the spectaculargrowth of mobile communications, which now stands at some2.5 billion users around the world. As fixed line use declines,mobile communication and its convergence with broadbandtechnologies will continue to shape the future of the sector.

Having kept Cayman connected over four decades,today C&W is prepared for the new generation of tech-nology and the firm is one-step ahead of developmentsand ready to meet the demands of its customers.

“The way mobile phones are used is a key factor in thefuture market,” said David Smith VP of Mobile. “Voiceaccounted for close to 100% of mobile phone use just a fewyears ago; today it’s down below 80% because of texting, pic-ture messaging and data services, which have all changed theway in which C&W customers communicate. With the adventof phones that double up as MP3 players, cameras and emaildevices, we expect voice to diminish even further.”

The use of walkie-talkie functionality is adding anoth-er dimension to phone use. C&W has launched thePushTalk service to business customers in answer to that,which acts as an add-on feature to an existing postpaidservice enabling improved productivity and cost efficien-cy. Improvements in video technology and security cam-eras viewed through sophisticated mobile devices will alsobe significant contributors to future growth.

The most important element in tomorrow’s mobileworld, however, is the convergence between technologies,where mobile phones become increasingly more comput-er-like, using wireless broadband to deliver services topeople on the move.

“Over the next few years everything you can do on alaptop you will be able to do on your mobile device,” addsSmith, and C&W is here to lead the way. As market lead-ers, C&W is always seeking ways to make life easier fortheir customers. An example of this is the BlackBerry Liteplan which makes BlackBerry service even more accessi-ble to customers. With the startingprice an affordable $10, it gives every-one access to email and the internetwhenever and wherever they want.

As the technology allows people tobe increasingly mobile, the way cus-tomers pay for services will alsobecome more flexible. Recently C&Wlaunched their Western Union top-upservice where bmobile prepaid cus-tomers can purchase credit through anyWestern Union outlet in the USA whilstthey are roaming there. “Convenience is

what our customers are asking for and we are constantlylooking for more ways to provide it,” Says Smith.

A major boost for local business has been the intro-duction of worldwide roaming rates opening up true glob-al communication. The newly launched BlackBerry unlim-ited roaming plan is a classic example of how C&Wensures that its customers control costs and take advantageof the lowest rates worldwide. Business customersdemand email access 24 hours a day across the world andC&W is set up to deliver exactly that.

As the technologies converge, Smith says he and hiscolleague Anthony Ritch VP of Broadband and Voice willwork ever more closely as the services become increas-ingly interactive and interchangeable.

In the consumer sector Ritch predicts more homes withmultiple points of access to the web through touch-screenson everything from lighting controls to refrigerator doors.Consumers already use WiFi in the home to connect mul-tiple computers, NetSpeak, gaming consoles, security cam-eras, etc. and the possibil-ities are limited only bytheir imagination.

Beyond the homeenvironment, C&W seesWiMAX as the technologi-cal standard of the future enabling island-wide wireless highspeed connectivity for homes and businesses. Users willenjoy island-wide broadband access without having to benear their home network and C&W is already positioningitself to release this exciting wireless mobility option.

Businesses will also start deriving more value fromwireless networks. While many offices already utilise WiFifor broadband connectivity, newer desktop VoIP phonesystems can now utilise this technology too. Businessvoice needs will require more resilience and C&W’s VirtualOffice VoIP solution will ensure that business voice lineswill work from any location with broadband access.

Corporations are also seeking to consolidate serviceswith network providers, equipment vendors, services andtechnologies. The very latest C&W-deployed technologies

like Metro-Ethernet and MPLS arealready delivering substantial value herein Cayman and across the world to cor-porations with very stringent needs.

“Amalgamating complex technolo-gies to provide the very latest commu-nications solutions at the right pricehas been the hallmark of C&W’s suc-cess and will continue to be the key toC&W’s future growth,” and Ritchnoted, in closing, that they are wellunder way with taking the company tothe next frontier. ❂

Cable & WirelessT H E O N LY F U L L S E R V I C E T E L E C O M M U N I C AT I O N S P R O V I D E R I N T H E C AY M A N I S L A N D S

FOR MORE INFORMATION OR FORASSISTANCE, PLEASE CONTACT US BY:

CALLING OUR 24 HOUR CUSTOMER SERVICE LINE ON 811

STORE LOCATIONS: ANDERSONSQUARE, GEORGE TOWN OR

GALLERIA PLAZA, WEST BAY ROADPLUS ANY OF OUR 27 PARTNERLOCATIONS THROUGHOUT THE

CAYMAN ISLANDS

WWW.CW.KY

TELECOMS LEADER LOOKS TO THE FUTURE

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WestStar TV LimitedC E L E B R A T I N G 1 5 Y E A R S O F B E I N G “ W I T H Y O U E V E R Y D A Y ”

It was the communications miracle that brought the worldto Cayman’s doorstep. Television! “It started with a sparkof imagination, a lot of know-how and a group of pio-neering individuals who came together at the right timewith the right dedication and commitment,” says RodHansen, CEO of WestStar, which is today on the eve of cel-ebrating 15 years in the Cayman Islands. During that time,the company has introduced broadcast and cable televi-sion services, deployed new technologies and built theinfrastructures that have helped to make the CaymanIslands a leader in high-tech communications throughoutthe region.

At the inception of the project to introduce televisionto the Cayman Islands were local business leaders Joanand Colin Wilson, and BobbyBodden, who had beengranted licenses for two localUHF TV stations. They metup with Rod Hansen, avisionary cable industryexpert from the U.S. who hadsuccessfully built and operat-ed television companies inCalifornia, Nevada andIdaho. Hansen brought infinancing and assembled ateam of industry expertsspearheaded by long-timeassociate Mike Martin, at thattime a senior executive with Gannett, the parent companyof CNN, and Rick Alpert, also of Gannett, and the recipi-ent of more than a dozen Emmy Awards for his produc-tion capabilities.

Fifteen years later, thanks to teamwork and persever-ance, WestStar is in 85 percent of Cayman’s householdsand was recently one of the first companies in theCaribbean, through its partnership with WestTel (see Page28), to launch a triple play of communications services toits customers. That mix of digital cable TV, high-speedInternet, and telephone service creates a world of com-munication options for Island residents.

AN EXCITING AND REWARDING JOURNEY“To say we have come a long way would be an under-statement,” says Mike Martin, who is still general managerof the completely rebuilt, state-of-the-art Television Centreon Eclipse Drive. He recalls a time when news storieswere flown in on eight-track tapes, and satellite disheswere as big as your house. “Back in the days of thedinosaur dishes, it was hard to imagine what was about totake place. But I think I can speak for nearly everyoneinvolved in saying it has been an exciting and rewardingjourney.”

From ‘No news is good news’ to receiving the dailynews in live broadcasts, Cayman has grown and flourishedas a leading business and tourism destination over these15 years, hurricanes notwithstanding. At the same time,WestStar has become an integral part of the community,giving back time, technology and resources and reachingout to Island residents in a myriad of ways (see insetstory).

“When we say, ‘With You Every Day,’ it’s more than amotto, it’s our mission statement,” notes Rod Hansen,reflecting on how the company has applied that philoso-phy to its business. It starts in the morning with the earlyDaybreak show, and caps off the day’s events withCayman 27’s not-to-be-missed evening news. Add to this

VISION, TECHNOLOGY, AND THE RIGHT PEOPLE

WestStar has become an integral part ofthe community, giving back time, technology and resources and reaching out to Island residents in a myriad of ways.

ON-AIR ANCHORS CHARLES GLIDDEN, SHEENA HURLSTON, AND JOHN FOSTER.

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some of the most compelling localprogramming produced in the region,and more than 100 digital cable TVand music channels offering the bestin regional and international pro-gramming, and you have a servicethat Island residents have come torely on. Today, businesses and resi-dents alike also rely on sister companyWestTel’s services for critical commu-nications applications, high-speeddata, Internet and telephone services.

A UNIQUELY CAYMANIAN ENTERPRISE

Offered today over one of the mostadvanced digital broadband networksin the Caribbean, WestStar’s televisionoperations are perhaps the mostinspiring and romantic pillar of thetriple play of services. From the begin-ning, under the skilful direction of the

Wilsons, Bobby Bodden and RodHansen, and supported by a top-notchtechnical team and solid investmentpartners, the project captured thehearts of the Caymanian people. “Itliterally changed island culture,” saysMike Martin, recalling the day thecompany switched on service for thefirst time. “As people became engagedin the development of our program-ming, the TV stations took on amomentum of their own, reflectingand driving the life of the community.”

“When we first came in withthese new broadcast and cable tech-nologies and equipment, we had tocall on overseas expertise,” saysRod Hansen. “Today, Cayman hastaken these systems and technolo-gies and mastered them, putting thecountry squarely in a leadershiprole in terms of communications,

because it’s not just about technolo-gies, it’s about the people who usethem. Today more than 85 percentof our staff members areCaymanian, and many of them havebeen with us since the very begin-ning. We are especially proud ofthat,” he adds.

Within four years of launching,the cable business became profitable,and WestStar put the revenue back towork for the company, creating moreopportunities for new services, deepen-ing its community involvement,upgrading its systems and training itsstaff. Local programming was alsogiven a new boost, and, once again,the community responded withenthusiasm.

In the early 1990s, Cayman hadonly limited exposure to news andmedia, in general, with one radio

The successful development of television broadcasting and the supply of cable programming here in Cayman are due in

large measure to the vision and commitment of WestStar’s CEO Rod Hansen.

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station and one daily newspaper.Shows such as Issues 27 were cutting-edge and brought a new forum fordebate into local homes.

In 1994, two years after WestStarbegan delivering cable to GrandCayman, it expanded its services toCayman Brac and Little Cayman. Theacquisition of the electronic newsgathering (ENG) van in 1996 broughtthe concept of instantaneous live pro-gramming to the living rooms ofCayman and, in the first televisedelection in the country’s history,McKeeva Bush was the first localpolitician to recognize—and utilize—the power of television on the cam-paign trail.

The local business communityquickly caught on to the value of TVadvertising, and WestStar built a full-service production facility, studiosand editing suites to enable the cre-ation of local TV commercials andprogramming on a par with the bestU.S. products. “From the beginning,our studios were built to CNN stan-dards,” says Mike Martin, noting thatthey have been re-built and upgradedseveral times over the years. “Our dig-ital production equipment is first-class, which has enabled locally pro-duced commercials to become a reg-ular ingredient of local television.”

With strong financial resources,leading-edge technologies, greatspirit, and a world-class team,

WestStar’s future looks bright. Thecompany will soon be re-launchingthe “Discover Cayman” channel, andis in the process of introducing areal estate channel to benefit buyersand sellers of properties in theCayman Islands. HDTV is also onthe horizon.

Meantime, WestTel has attractedmore than 4800 customers and plansto expand and enhance its data andtelephone services across the islands.The adventure continues . . . ❂

GENERAL MANAGER MIKE MARTIN:“BACK IN THE DAYS OF THEDINOSAUR DISHES, IT WAS HARD TO IMAGINE WHAT WAS ABOUT TO TAKE PLACE.”

FOR INFORMATION OR ASSISTANCE, PLEASE CONTACT US AT:

PHONE: 345-745-2739E-MAIL: INFO@WESTSTARTV.COM

TELEVISION CENTRE 45 ECLIPSE DRIVEGRAND CAYMANCAYMAN ISLANDS

WWW.WESTSTARTV.COM

G I V I N G B A C K T O T H E C O M M U N I T YBringing news, entertainment, weather and sports to the Cayman Islands is onlypart of WestStar’s mission of being “With You Every Day.” “We have always beendeeply concerned about this community, its residents and their safety and well-being,” says Rod Hansen. Over the years, WestStar has created or participated indozens of community initiatives and has used its technologies to benefit local res-idents in a variety of ways.

RAISING THE ROOFFollowing Hurricane Ivan, WestStar came up

with the idea of a “Raising the Roof Telethon.”

CITN executives and National Recovery Fund

representatives wasted no time getting on board

and together they produced a national telethon

in just two months. The show aired live on

Cayman27 on the first anniversary of

Hurricane Ivan and, thanks to the generous sup-

port of individuals and local business, raised

just under CI$2 million. The funds raised were

literally used to rebuild roofs on homes across

the Island.

SPECIAL OLYMPICS CAYMAN ISLANDSFor more than 10 years, Cayman27 has helped raise awareness and funds for the

Cayman Islands Special Olympics, and this year the television station stepped up its

support to coordinate all of the Special Olympics Cayman Islands fundraising efforts.

Thanks to the generous donations from businesses and individuals across the islands,

Cayman27 was able to present a cheque for CI$60,000 to the Special Olympics Cayman

Islands committee earlier this year. The donation will provide traveling suits, airfares,

visas, travel and other expenses for the team.

CAYMAN27 ISLAND LIVING SHOWWith the Island Living show, now in its sixth year, WestStar has introduced a new busi-

ness opportunity for Island-based companies as well as a platform for charitable organi-

zations to raise money, and bundled it all into an exciting and entertaining event that

the whole family can enjoy.

With more then 5,000 visitors in 2007, the Island Living Show has grown every year and

now includes a car and boat show in addition to the home and garden exhibits.The show

is free to the public and has proven to be a wonderful opportunity for the Television

Centre to get involved with the community.

YOUNG CAYMANIAN LEADERSHIP AWARDSWestStar is also a founding and ongoing major sponsor of the YCLA (Young Caymanian

Leadership Awards), for which it produces a live telecast of the yearly Awards event.

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Energy management, alternative energysources and environmentally sensitiveproducts will be the future ofCommercial Building design in theCayman Islands. Locally qualified andappropriately trained professionals willbe in demand as business ownersbecome more environmentally sensitivedue to global demands by their tradingpartners and clients.

The Cayman Islands Building Codehas been silent on energy consumptionand building envelope design to date;however, high energy costs and social

responsibility shallmake this area ofdesign critical innew buildings inthese Islands.Consumers areactively seeking todo business withcompanies thathave acceptedGlobal Climatechange, that pro-duce low carbonemissions and

have had their buildings designed in a“green” manner. Globally, buildings con-sume over 65% of the electricity producedbut in Cayman it is likely to be closer to90% as we have little industry here.

Cayman companies carrying outinternational business and large interna-tionals with branches here will lead theway locally as their shareholders andglobal clients demand zero carbon impacton the world’s climate.

So how does a company achieve thenewest standard in global architecturaldesign? Well, first by choosing a designTeam that has trained architects and engi-neers in the practice of low energy, greenDesign coupled with the essential localknowledge. The foremost standard in theUnited States is named “Leadership inEnergy and Environmental Design” or“LEED™”. This standard will likely beused in our Islands as the USA is the pri-mary source of our construction materialsand methods. The LEED™ rating systemseeks to compare a building’s greendesign through a point system. Recently,

the Cayman Government has used someof the LEED™ system as a basis of designfor its buildings.

And what does a “green” buildinglook like and what does it cost? When“green” is designed in from the begin-ning, the buildings may look fairly simi-lar to existing structures. A recycled flooror wall covering is indistinguishablefrom one made of energy dense and vir-gin materials. However, the specificationof the proper materials is essential,designed to respond to the local climatenot only in a passive manner, whichwould include fixed shading devices andlarge overhangs but also in an activemanner. Active controls within a build-ing may recycle wastewater for land-scaping; use solar energy, automaticallycontrol lighting systems depending onlevel of sunlight being reflected in asexamples.

Past studies have indicated that“green” buildings are only 4 to 5% moreexpensive to construct. When one real-izes that cost of construction is less than20% of the overall lifetime operating costsof a building, the additional componentsin the design stage are more than out-weighed by the energy savings, moralchoice and customer response during itslifespan.

LEED™ will ensure that the buildingsachieve proper site selection, water andenergy use, environmentally preferredmaterials, proper waste stream manage-ment, define indoor environmental quali-ty as well as innovative sustainabledesign.

Ultimately, Cayman businesses willachieve significant savings in operatingcosts, enhanced profits, improvedemployee productivity, higher lease ratesand will optimize their life-cycle perform-ance. From Cayman’s point of view, thenew “green” buildings will conservescarce resources and minimize the impacton the environment. ❂

Burns Conolly, AIA is the managing director of theBurns Conolly Group, a premier Cayman fullservice design firm and a member of the U.S.Green Building Council. The Company has made acommitment to having the remaining professionaldesign staff trained to full LEED™ certification thisyear, becoming the first firm to do so.

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The Burns Conolly Group, Limited

FUTURE OF CAYMAN COMMERCIAL BUILDING DESIGN

MANAGING DIRECTORBURNS CONOLLY, AIA

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Ernst & Young

With more than half of all of the hedge funds in theworld registered in the Cayman Islands, financialservice professionals here are keeping a keen eye ondevelopments—political, regulatory, and economic—within the industry. On May 13, Dan Scott, ManagingPartner of Ernst & Young in Cayman, delivered thekeynote address to the 2007 GAIM Hedge FundConference, held at the Ritz-Carlton, Grand CaymanHotel. This article is adapted from his remarks.

—You have seen the headlines: Fortress and Blackstonegoing public . . . Hedge funds moving into private equity. . . pension funds making big investments in the space.We have start-up funds gathering billions of dollars . . . theFed Chairman talking about systemic risk . . . and hedgefund replication strategies promising to deliver hedge fundreturns at a fraction of the cost.

The industry is changing fast, and it is easy to get lostin the daily excitement of it all. However, there is one evenmore fundamental change that is driving the big issues thatwe face, and that is the tremendous growth of this industry.Consider the numbers:

• Fifteen years ago, the biggest hedge fund had $6 billionunder management; today $6 billion does not even buyyou a slot in the top 50.

• Fifteen years ago, the average hedge fund had $30 mil-lion in assets; today that is closer to $150 million.

• Fifteen years ago, there were just over 1,000 hedgefunds; today there are more than 10,000 worldwide!

But here is the one that really gets me: In 2006—onlyone year—hedge funds added $500 billion in assets, tak-ing our industry to $2 trillion under management. To putthat in perspective, we did not cross the $500 billion markin total assets until 2001.

GLOBALIZATIONOne of the drivers of this tremendous growth is that hedgefunds have gone global, in every possible way.

First, the customer base has gone global. Today newassets are more likely to come from Asia or Europe thanfrom the United States. This new international client basecomes with different expectations about disclosure, risk,valuation, and governance, and they also bring a differentuniverse of regulators and stakeholders into the mix.

At the same time, the investments horizons of hedgefunds have gone global as well. Whether it is WesternEuropean debt or Asian copper mines, smart money isseeking high-value opportunities wherever they are locat-ed on the planet.

This creates tremendous challenges: currency risk,legal and regulatory environments, political relationships,cultural sensitivities, management recruitment and reten-tion, and ultimately a strategy for exit. All of these issuesare hard enough to manage in the U.S. and Europe; acrossthe globe, they multiply like rabbits.

The $2 trillion hedge fund industry is no longer sittingon the quiet margins of the capital markets. I think, on bal-ance, that is a good thing. But remember: When you casta bigger shadow, you also make a bigger target.

RISK, TRANSPARENCY, AND REGULATIONInvestors, politicians, and regulators see the tremendousgrowth in this industry, and they are crying out forincreased regulation.

Most Americans and Europeans tie “hedge funds” to“mysterious,” “secretive,” and “risky.” Regulators andmedia critics alike claim that “transparency” is the answer.

In a prior age, regulators could just collar a few dozenbanks, and they would learn where the potential problemswere. Now they can’t do that. So they are turning to ourindustry, and wondering whether increased disclosure offund portfolios will help.

Will it? I’m not so sure.The problem for regulators is that they are operating

with a number of handicaps not of their own design. Forstarters, you have basic geography. Hedge funds havegone global and financial markets have gone global, butregulators remain local, national, and, at best, regional.

Even if U.S. regulators could look inside each andevery hedge fund portfolio operating in the United States,it would not tell them much about systemic risk. It wouldprovide them with simple and isolated disclosure whenwhat’s really needed is true transparency of risks on aglobal scale. Portfolio-level disclosure can help catch badactors, but that’s not the concern here. The fact that riskstoday are highly dispersed and highly global is a goodthing, but it limits the value of “blind disclosure” on thelocal level.

I don’t have a magic solution to this problem, but Ido think I can point towards the right questions. If youare truly looking for systemic risks, the best place to look

HEDGE FUNDS—A DYNAMIC INDUSTRY IN EVOLUTION

We have grown into a $2 trillionindustry because we deliver solid

returns—returns that investors arewilling to pay for, and that they are

not able to find anywhere else.

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is at the flow points of the system.There are critical passage pointswhere a lot of information about theindustry is available. Prime brokers,for starters, have more vision into theglobal flow of assets than almostanyone.

I think it is also important that wedistinguish between transparency anddisclosure. Disclosure gets you infor-mation—transparency gets youinsight. Done right, increased trans-parency can help investors makesmarter decisions about risk. Doneright, transparency can limit—or atleast expose—systemic risks. It canalso act as a disincentive for fraud, allof which will boost investor confi-dence and lead to growth for thisindustry.

TWO PROMISING FUTURESThe thing to remember is that at theroot of all of our challenges is a fun-damental truth: Hedge funds work.We have grown into a $2 trillionindustry because we deliver solidreturns—returns that investors arewilling to pay for, and that they arenot able to find anywhere else. I thinkwe will continue to generate thosereturns if we handle our growth in asmart way.

But growth also creates new chal-lenges. Today, the industry casts alarger shadow than in the past, and

attracts greater attention. We havegone global, creating new risks toboth hedge fund investors and thebroader economy. We have expandedour position in derivatives and alter-native assets, raising legitimate con-cerns about systemic risks. And wehave created enormous funds—mega-funds, with mega-infrastructures—that have to be managed and handledappropriately.

How will it all work out? I thinkultimately we will walk down twopaths.

One the one hand, we will havea new kind of hedge fund manager—one that may decide to go public,open up the hood of its investmentstrategy, and subject itself toincreased levels of regulation. Theupside for these firms is that they willbe able to target an increasingly largeportion of investors and will gain theflexibility that comes from monetiz-ing the asset management company.But this will lead to new levels ofregulatory scrutiny and have newinvestors with different priorities forthe business.

On the other hand, we will alsohave the firms that stay private andare quiet about their strategies, theirreturns, and their compensation struc-ture—quiet in terms of not castingsuch a large shadow on the publicsphere. And these firms may have a

freer hand to operate within a morelimited universe of investors.

The good news is, there areopportunities for both the “public”firm and the “quiet” firm to beextremely successful.

So, in conclusion: I am tremen-dously optimistic about our industry.I believe we will continue to seeamazing growth as long as weremain focused on our core mission:generating returns for investors. Ourchallenge is how we manage thatgrowth and how we build the infra-structure to manage risk. Meetingthat challenge will require hedgefunds and regulators to engage in aconstructive, open dialogue. I amvery confident that we will take thisindustry to a dynamic, sustainablefuture. ❂

FOR INFORMATION OR ASSISTANCE, PLEASE CONTACT US AT:

PHONE: 345-949-8444FAX: 345-949-8529

SUITE 640162 FORUM LANE, CAMANA BAYGRAND CAYMAN,CAYMAN ISLANDS

WWW.EY.COM/CAYMAN

DAN SCOTT, MANAGING PARTNER OF ERNST & YOUNG, ADDRESSES THE OPENINGSESSION OF THE GAIM HEDGE FUND CONFERENCE AT THE RITZ-CARLTON.

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Close Brothers (Cayman) LimitedTRUST AND CORPORATE SERVICES • FUND SERVICES • BANKING SERVICES* • INVESTMENT MANAGEMENT SERVICES

*Banking provided through Close Bank (Cayman) Limited.

Close Brothers (Cayman) Limited was established in 2001when Close Brothers Group plc. purchased CharteredTrust from Ernst & Young.

Since then, the company has evolved from a team ofseventeen focused on trust and corporate work, to morethan sixty people working on an increasingly diverserange of offerings.

Today, trust and corporate services account forapproximately 30 percent of the business, with fund serv-ices, as well as banking and asset management services,

making up a major part ofthe business.

A member of theInstitute of CharteredAccountants in England &Wales and a member of theSociety of Trust and EstatePractitioners, LinburghMartin, the ManagingDirector and a significantminority shareholder, has animpressive biography.

A former trustee of thePublic Service PensionBoard, a former councilmember of the CaymanIslands Society of

Professional Accountants and a former member of theboard of directors of the Cayman Islands MonetaryAuthority, he has been the driving force behind the firm’sgrowth and diversify its earnings.

“We have really diversified offerings and have becomea bigger and much stronger business in the last six yearsor so,” says Mr. Martin. “We are very committed to thisbusiness, we like what we do and we are doing well at it.”

This growth has helped Close Brothers (Cayman)Limited improve its services overall and, as a result, it hasfocused on acquiring businesses that can further thatgrowth.

A fundamental requirement for that continued goal ispeople, and although the labour pool in Cayman is small,this is not a constraining factor because the company hasa strong reputation as good employer.

“The message is out there that Close Brothers is a verygood place to work and we are doing dynamic things. Wedo a good job at attracting and keeping talent and, as apeople-business, that is crucial,” says Mr. Martin.

As a highly respected firm, its clients expect continu-

ity, and low staff turnover is important. However, the

firm's retention success is not just based on financial

rewards.“We are competitive payers, but that's not the main

reason. I believe that we have a low level of bureaucracy

and red tape, so we can respond to the needs of staff veryquickly and we are pretty good at the soft touch,” addsMr. Martin.

With an active social committee, a constant focus onthe needs of staff and open communication, the firm hasdeveloped a strong network of support for employees out-side, as well as during, office hours. The challenge ofwork is also something the company takes pride in andensures that employees use their talents to the full.

“People want to be stretched. Part of nurturing talentis helping people grow. The great thing about Cayman,aside from being a nice place to live, is that it is a chal-lenging and competitive place to work, too. I like to seepeople use 100 percent of their talent,” Mr. Martin adds.

With the seven-year work-permit beginning to makean impact on the local workforce, he says he is confident

it will not be a problem, provided it is implemented prop-erly. After all, he says, rollover is the price to be paid fora fairer system.

Looking to future staffing needs, the company is col-laborating with the University College of the CaymanIslands (UCCI) to nurture and attract young Caymanians tothe sector.

With a talented professional team as its primary asset,the future looks bright for Close Brothers, which has a cor-porate eye on growing areas that could be described asgoing against the crowd.

Although the success of hedge funds in Cayman hasbeen an engine of growth for the firm, and while furthergrowth will be beneficial, there is strength in diversity.

“Having acquired a significant bank representation busi-ness, we will become the market leader in this area, and thisis an illustration of the new areas we will be developing.”

Mr. Martin believes this field has been neglected bythe jurisdiction as a whole and we hope to generate mod-est growth.

DIVERSIFYING FOR FUTURE SUCCESS

MANAGING DIRECTORLINBURGH MARTIN

The future for Close Brothers isabout people and diversification and,above all, being the best it can be tomeet the demands of a growing and

increasingly sophisticated marketplace.

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FOR INFORMATION OR ASSISTANCE, PLEASE CONTACT US AT:

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Although global banking mayhave consolidated, he sees an oppor-tunity for Close Brothers to get agreater share of the existing market.“We want to look at this area andchallenge thinking that there is nomore growth to be had. We believe itwill be a good move for us.”

Investment and private wealthmanagement for people based inCayman is another area of significantattention.

“We intend to focus more on pri-vate client business and marketing thebenefits of setting up trusts to high networth individuals. We want to chal-lenge the idea that Cayman is just forinstitutions. We believe that there is alot of private wealth business to bedone here,” says Mr. Martin.

Already a market leader in per-sonal trusts, Close Brothers is wellpositioned to develop that segment ofits business further because of theexcellent trust professionals it employsand its investment offerings.

“Providing investment manage-ment on the island will be an impor-tant element in our future evolution.Many people have their money onfixed deposit, and I think there is a lotwe can do to help those individuals

create wealth for themselves throughgood products.”

Over the next few years, Mr.Martin says there will be challenges inhow regulation affects the sector as awhole, and he believes that the focusshould be on the spirit of the lawrather than merely ticking boxes.

“We have to be careful as a juris-diction not to over regulate, but to doit the right way. ‘Know your cus-tomer’ is not getting a copy of a bankreference and passport, but reallyknowing them, spending time withclients in their own communities, forexample.”

Mr. Martin explains that the waycompliance is achieved is importantand continually challenges his teamabout ways to do that. Meeting thechallenges over misconceptionsabout how the jurisdiction is per-ceived overseas will come, hebelieves, from continued growth andsuccess.

“The visibility of the jurisdictionand getting the message out isimproving. I hope to see more overthe next few years and many agen-cies here are doing a pretty goodjob. We need to get into the market-place and network with our clients

and market ourselves and the juris-diction, something that CloseBrothers is doing and will continueto do.”

The future for Close Brothers isabout people and diversificationand, above all, being the best it canbe to meet the demands of a grow-ing and increasingly sophisticatedmarketplace.

The last five years have trulybeen a success, and Mr. Martin andhis team are continually optimisticthat the next five years will be good,albeit there will be challenges alongthe way. ❂

“We need to get into the marketplace and network with our clients and market ourselves and the jurisdiction, something that

Close Brothers is doing and will continue to do.”

PHONE: 345-949-8455FAX: 345-949-8499 OR 946-9717E-MAIL: INFO@CBCL.COM.KY ORCLOSEBANK@CBCL.COM.KY

P.O. BOX 1034HARBOUR PLACE, 4TH FLOOR103 SOUTH CHURCH STREETGRAND CAYMAN KY1-1102CAYMAN ISLANDS

WWW.CLOSEBROTHERS.COM.KY

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AAlready known for its presence in theresidential market, telecoms providerWestTel is increasing its focus ontechnology services to businesses.

“We are focused on understandingCorporate customer needs whilst at thesame time providing world classservice,” says Calvin Morton, WestTel’sVice President for Sales and Marketing.“Traditionally, we have simply providedbandwidth to our Corporate clients, butwe are now developing propositions inline with an understanding of wherebusiness leaders in Cayman are feelingmost pressure from an IT perspective.”

Sales Manager Heather Lockhartdescribes how clients use some ofWestTel’s services. “A number of ourCorporate customers with multiplelocations on island, use WestTel’s datacapability to construct ‘any-to-any’ con-nectivity, at a fraction of traditionalcosts,” she says. “Others are usingWestTel’s voice and data services toprovide both domestic and internation-al connections, all backed by outstand-

ing technical support from our 24x7support team based here in Cayman.”

Under the service level targetsthat WestTel offers to business cus-tomers, there is a guarantee of 99.96%uptime for its Corporate customers.While WestTel takes care of managingcustomer networks, this approachreleases valuable resources withincustomer organisations to help buildtrue competitive advantage.”

WestTel, founded in 2003, is jointlyowned by local cable TV providerWestStar and Bermuda’s KeyTech. Thetwo companies created WestTel to pro-vide Internet, Voice and Managed DataServices to both residential and corpo-rate clients. WestTel’s relatively modestsize gives it a unique ability to be flex-ible and innovative, strengths which thecompany uses to differentiate itself inthe local telecommunications market.

“Our residential services haveproved extremely popular with cus-tomers looking for convenient, flexible,cost effective internet service at home.

Customers can sign up for service atour offices in Governor’s Square andbe surfing on their favourite web siteswithin 15 minutes. There are no engi-neers involved and no waiting forweeks for someone to install yourservice. If a customer moves, theirinternet service moves with them. It’squick, easy, flexible—and only avail-able from WestTel,” says Morton.

For further information on allWestTel services, please call 745-5555. ❂

WestTelB R O A D B A N D • T E L E P H O N E • D A T A

TARGETING THE FUTURE OF COMMUNICATIONS

VICE PRESIDENT FOR SALES AND MARKETING CALVIN MORTON

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KKroll Cayman is a leading provider of

services to the financial industry,

including insolvency, corporate

restructuring, litigation support, and

forensic investigations.

Internationally, Kroll is a full-

service global risk consulting company

that is structured to help clients over-

come a wide variety of challenges they

face in virtually any jurisdiction. As a

member of the Kroll network, Kroll

Cayman has the ability to access the

knowledge and expertise of thousands

of professionals stationed in more than

65 cities and 25 countries throughout

the world.

In addition to its core services,

Kroll Cayman can assist its clients by

providing expertise and support in

the following areas:

Corporate Preparedness Services—

Because companies are under ever-

increased scrutiny by shareholders,

regulators, customers and consumers,

corporate preparedness has now

become a vital standard of corporate

governance. A recent study by

Oxford University revealed that com-

panies with robust corporate pre-

paredness plans effectively earned on

average 25 percent higher sharehold-

er value than companies without

these capabilities one year after a

major crisis.

Electronic Evidence—Kroll can

facilitate the collection, organization,

and analysis of electronic documents

for use in legal proceedings, regulato-

ry matters, and investigations.

Background Screening—Hiring

the best people and vendors is integral

to the success of any organization.

Kroll can help clients detect potential

risks such as resumé fraud, criminal

convictions, and past terminations.

Identity Theft—Kroll can assist in

restoring an individual’s identity to

pre-theft status.

Security Consulting—Kroll is

unsurpassed in its expertise in prepar-

ing and implementing internal and

external security programs for its

clients.

Although Kroll is well known

worldwide for its cross-border prod-

ucts and services, Kroll Cayman rec-

ognizes—and embraces—its respon-

sibility to be a good corporate citizen

of the Cayman Islands.

Under the leadership of Managing

Director Jim Cleaver, Kroll Cayman

places the highest priority on devel-

oping young Caymanians through its

recruitment and scholarship programs

as well as offering superb career

opportunities to motivated young

people.

Kroll Cayman was established in

2005 when Mr. Cleaver and his part-

ners acquired a local insolvency and

corporate restructuring firm. Through

an additional acquisition in 2006, the

firm has established the practice of

Kroll (BVI), headquartered in Tortola,

British Virgin Islands. ❂

REDUCING RISKS FOR BUSINESSES

Kroll (Cayman) Limited

For further information, contact:

Jim CleaverKroll (Cayman) Limited

PO Box 1102,Grand Cayman

Cayman Islands, KY1-110Tel: (1) 345-946-0081Fax: (1) 345-946-0082

Email: jim.cleaver@krollcayman.ky

William TaconKroll (BVI) Limited

PO Box 4571,Road Town

Tortola, British Virgin IslandsTel: (1) 284-494-9600Fax: (1) 284-494-9601

Email: william.tacon@krollbvi.vg

Visit www.kroll.comfor full details of all our services

Our core services include:

• Insolvency • Corporate Restructuring

• Litigation Support • Forensic Investigations

Our presence in Cayman and the Eastern Caribbean as a leading

provider of insolvency and restructuring services is enhanced by

being part of Kroll, the world’s leading risk consultancy company.

With local access to the full range of Kroll’s services, we offer our

clients seamless global coverage.

PROTECTING YOUR ASSETS AND YOUR REPUTATION

KROLL IN THE CARIBBEAN

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The Water Authority - CaymanS U P P L I E R S O F T H E W O R L D ’ S M O S T P O P U L A R D R I N K

The importance of water is too oftenoverlooked. Water, along with other natu-ral resources, provides a foundation forsocial, economic, and environmentaldevelopment. As little as twenty yearsago, without a piped water supply orsewerage facilities, most residents of theCayman Islands within the Authority’sservice area collected rainwater in cis-terns or pumped groundwater from wellsfor drinking, and disposed of sewage incesspits. With the rise in tourism and theconstruction of commercial and residen-tial developments, there was an increaseddemand for a reliable source of clean,running water, and proper wastewatermanagement programmes.

“The establishment of the WaterAuthority during 1982-1983 was a crucialstep in the development of the CaymanIslands,” said Dr. Gelia Frederick-vanGenderen, Director of the WaterAuthority. “Today nearly 12,000 house-holds benefit from a clean, purewater supply from theWater Authority, com-pared to 842 twentyyears ago.”

Recent and ongo-

ing expansion projects

by the Water Authority such as

the piped water supply to East End and

North Side are fundamental to residential

and commercial development in those

districts. “In response to our customers’

needs, we will also be expanding the

water supply network on Cayman Brac,

replacing the Governor's Harbour sewer-

age system, and upgrading the water dis-

tribution system in South Sound,” said

Chairman of the Water Authority Board,

Mr. Brainard Watler. As network expansion works are car-

ried out, another key focus is the continu-ous improvement in customer service. Thefuture implementation of the SCADA con-trol system will allow the Water Authorityto remotely manage the entire water distri-bution network. “SCADA will facilitate sys-tem optimisation on the water treatmentand delivery side and improve trou-bleshooting capabilities on the pipelinenetwork resulting in faster customer

response time,” said Mr. Tom vanZanten, Deputy Director. “We're alsolooking at integrating our customerinformation system with a GIS platformwhich has a complete home-level geo-graphical representation of the islandsthat will assist our engineers in diagnos-ing problems and identifying areas forfuture expansion.”

As the demand for water has grown,so has the Water Authority team. To meetcurrent and future operational needs, theAuthority is expanding its administrativeheadquarters. With expected completionin mid-2007, the building extension pro-vides additional office space for theAuthority's 113-person staff and will serveas an emergency control centre for disas-ter command. “With a hurricane-proofbuilding to house our command centre,we will be able to safely and effectivelymanage outages,” said Dr. Frederick-vanGenderen.

Next fiscal year the WaterAuthority achieves a

major milestone asthey celebrate their25th anniversary.The team is looking

forward to many suc-cesses, but is also preparing

for the challenges that lie ahead. Likemany other businesses, the Authority isfaced with keeping up with the country'srapid growth rate, competition for bothlocal and overseas labour, and the risingcost of energy, labour and insurance. Dr.Frederick-van Genderen expresses confi-dence in the Authority's ability to addressthese challenges head on:

“With our expansion projects andsystem upgrades, our staff programmes,an eye on our balance sheet, and a com-mitment to providing a high standard ofcustomer service, we are confident inour ability to continue serving theCayman Islands and to be an enabler ofeconomic growth for current and futuregenerations.” ❂

The Water Authority is the statutory body respon-sible for the management of water and wastewaterin the Cayman Islands. The AdministrativeHeadquarters is located at 13G Red Gate Road,George Town, Grand Cayman, Cayman Islands.

Healthy Living is in Your Hands

13-G Red Gate Rd., George Town, Grand Cayman Tel: 949-6352 Fax: 949-0094

Email: info@waterauthority.ky www.waterauthority.ky

Water Authority – CaymanSuppliers of the World’s Most Popular Drink

Our Promise to You

Water is our most precious

resource. The Water Authority is

committed to keeping our water

pure and healthy for now and for

future generations.

THE WATER AUTHORITY KEEPS UP WITH ECONOMIC GROWTH IN THE CAYMAN ISLANDS

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ONE STEP BETWEEN YOU AND SUCCESS

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