Up Front
Quite a stir was raisedamong officials and the public last week when this newspaper askedthe question if the Cayman Dollar should ...
'Revalue' Not 'Devalue'
Following the lead story of Cayman NetNews of Wednesday, 18 June, which asked "CI$ DevaluationAn Option?" from various reports reaching this newspapersoffices, there has been a lot of concern in connection with thisstory.
Hon. GeorgeMcCarthy, Financial Secretary
Accepting that the term "Revalued"should have been used in the headline, publisher of Cayman NetNews, Mr. Desmond Seales admits that while the question was raisedin a headline, it is unfortunate "so much anxiety has beencaused."
In an effort to gauge and report on thereaction of the community, this newspaper attempted to contactGovernment, financial industry and tourism officials. Many didnot return telephone calls or declined to comment over the two-dayperiod we committed to this exercise.
However, the Hon. Mr. George McCarthy, FinancialSecretary of the Cayman Islands Government, stated in a telephoneinterview, that "Government has given no thought (about revaluingthe Cayman dollar) at this time," and added, "But Ido not wish to give a comment at this time."
The concept of revaluing the Cayman dollarwas mentioned in a story printed in Wednesday's edition of thenewspaper as a way to stimulate the stumbling economy here andmake the Cayman Islands US dollar friendlier to tourists many of whom become piqued when told that their dollar is onlyworth 80 cents of Cayman money.
Mr. McCarthy and others were asked to providefeedback as to whether or not the story had received any reaction,if it had caused any shockwaves through Cayman or, simply, ifit was a good idea to revalue the Cayman dollar.
The Financial Secretary said "The onlyreaction is that quite a number of people, well established people,are calling to find out, making inquiries, as to whether the governmentis going to devalue the dollar" . He further emphasized,"With the economy now in a recession, or period of slow growthrather, we have to be very careful (what we say)," inferringthe fact that the question was raised can set off concerns aboutthe Cayman dollar's strength, which is still pegged to the USdollar.
Referring to the use of words in the story,in particular the headline and content, Mr. McCarthy said theword "devalue" scared people. He offered that "realignment"would have been more accurate for the story. Others contact suggestedthe term, "revalue."
The original story read that several economicpundits are predicting that the only way in which the Cayman Islandscan escape the present economic situation is by agreeing to placethe Cayman dollar on par with the US dollar.
"As ugly as it may seem, it's the onlyway we can have any chance of recovery in the tourism industry,"said one hospitality industry manager, who requested that hisname not be published.
The president of the Cayman Islands TourismAssociation, Mr. Rod McDowell was also contacted this week forreaction or insight on the matter of parity of the US dollar.Up until press time, there was no response.
Other tourism destinations like the Bahamas,British Virgin Islands, Turks and Caicos use the US dollar eitheron parity or as their own official currency. Even Cuba has specialtystores that offer better rates for the US dollar.
Speculations that the Cayman dollar willbe adjusted to be on par with its US counterpart have been rigorouslydenied by the Financial Secretary's office in the past, as theywere Tuesday by Mr. McCarthy.
Meanwhile, from reports received this weekit is known that a growing number of Caymanian and non-Caymaniansare continuing to convert their Cayman Islands dollar accountsto US currency.