Small place, big money: the Cayman Islands and the international financial system

This paper examines the offshore financial center (OFC) of the Cayman Islands in the Caribbean as part of an attempt to map emerging geographies associated with rapid and far-reaching changes in the international financial system, and to further a Marxian understanding of how capital increases its flexibility and averts crisis through the financial system. In this paper, the major industries of the offshore sector in the Caymans are outlined and their development presented. The author examines the Cayman Islands' development and operation as an OFC in two wider contexts: first, changes in the practice of international banking, and the regional competition between "entrepreneurial islands' for offshore finance. The author argues that the development of new spaces in the global economy - OFCs - cannot be understood without an understanding of changes in the international financial system. The changes in the international financial system cannot be understood except as operating through space and specifically through distinct spaces such as the OFCs. Although the Cayman Islands are a small place, they have strategically positioned themselves at the nexus of the circuits of fast and fungible financial capital and offer a window on the workings of the international financial system. -Author