Public-Private Partnerships under Construction
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Country Reports | 211
The Cayman Islands
Public-Private Partnerships under Construction
Laura Panadds-Estruch*
1. Country Overview
The Cayman Islands is an offshore jurisdiction locat-
ed in the Caribbean Sea, south of Cuba, west of Ja-
maica. Its small size of 102 square miles hosts the
worldwide fifth largest financial centre. As a British
Overseas Territory, Cayman falls under the jurisdic-
tion of the UK but enjoys independent law and pol-
icy-making.
A GDP of CI$2.84 billion (E3.04 billion approxi-
mately), prospects of an infrastructure overhaul and
an ongoing procurement modernisation aiming to
shake off a reputation for corruption and political in-
fluence should spur the interest of potential bidders
in Cayman.
11. Previous PPP Regulation and
Experience
PPPs have been discussed in Cayman over a decade
for key transport infrastructures. Before 2016, soft
law guidelines from administrative authorities were
the main source of PPP regulation.
In 2010, the Government considered PPPs for the
port and airport sectiors. The Miller Shaw indepen-
dent report on fiscal sustainability welcomed the re-
course to private capital into public infrastructure fi-
nance, but recommended privatisation instead.
The UK's sponsored Framework for Fiscal Respon-
sibility entered into force in 2012, implementing PPP-
friendly mechanisms and policy principles. These in-
cluded limiting government expenditure, capping
new borrowings and working in partnership with
the private sector. It placed value for money and ef
Laura Panadbs-Estruch, LLM Course Leader and Lecturer in
International Finance Law at the Truman Bodden Law School of
the Cayman Islands; PhD candidate in Law, University of Cam-
bridge, United Kingdom. E-mail: laura.panades@gov.ky.
DOL: 10.21552/epppl/2017/2/15
fective risk management at the core of decision-mak-
ing.
In 2014, the EY 'Proj ect Future'report recommend-
ed PPPs again for port, airport, waste management
and roads authorities. Other administrative units
were recommended privatisation. In response, the
Government has devised a Design-Build-Finance-Op-
erate-Maintain (DBFOM) PPP for waste management
and is considering PPPs for the Tourism Board, the
renewal and expansion of the cruise berthing facili-
ties at the port and the update and expansion of the
airport terminal and runway.
Ill. Current Framework
The recent procurement reform introduced exten-
sive PPP regulation by Law, scattered across the Pro-
curement Law 2016, the Anti-Corruption Law (2016
Revision), the Public Management and Finance Law
(2013 Revision) and the Financial Regulations (2013
Revision).
Whilst the new regulation has changed from soft
to hard law, it has not altered the use of PPPs as a last
resort. Four requirements and a series of exclusions
apply.
To start, PPPs require'a sound appraisal underpin-
ning the proposed project before the financing means
has been determined, proving that the project is nec-
essary. Additionally, a positive evaluation from the
public sector comparator is required or that 'afinan-
cial appraisal demonstrates improved value for mon-
ey against a conventionally financed alternative'.
PPPs should show better results than any other pro-
curement method. A 'long-term affordability case
[which] has been assessed and agreed by the appro-
priate technical experts retained by the Cayman Is-
lands Government'is also required. This is in line with
Cayman's government policy to adopt private sector
techniques into public management, such as intro-
ducing business cases, contract management and
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