The CPC—with the Colonial Secretary, the Commonwealth Secretary, the Foreign Secretary and the Minister of Defence meeting under the chairmanship of the Lord President of the Council was a flop. The Cabinet complained that it never got any direction from the Committee; the Committee complained that it was bogged down in sorting out day-to-day problems, and never had an opportunity to make exhaustive analyses of Imperial policy. It was abolished in June 1962, and nobody appeared to miss it.
But lacklustre though its overall performance may have been, the Committee enjoyed a spectacular success in what was almost the last decision it ever took. On 30th March 1962 it accepted the advice of the then Colonial Secretary, Reginald Maudling, and agreed that the Cayman Islands should be detached from the colony of Jamaica, which was then about to become independent, and become a new Crown colony, on their own.
The reasons had a lot to do with geography. The three Cayman Islands—Grand Cayman, Little Cayman and Cayman Brac—are tucked below the Great Antillean island of Cuba, and lie several hundred miles away from the island-arc chain of the Leewards and the Windwards. Jamaica, the Caymans’ mother-colony, was in 1962 a member of the Federation of the West Indies, and the Caymans, having nothing in common with the other members of the Federation, wanted to pull out. There is an almost exact parallel between the Caymanian attitude to the Federation, and Anguilla’s hostility to St Kitts—in the case of Anguilla, Britain sent troops to try to stop the impending rebellion; in the case of the Cayman Islands the Colonial Policy Committee agreed that no islander should be forced to join anything he didn’t want to. So the recommendation was made that the Caymans become a separate colony, with loyalty neither to Jamaica nor to the West Indian Federation (which in any case collapsed in an ugly shambles shortly afterwards), but only to the distant figure of the reigning British monarch. The full Cabinet agreed with the Committee, and so with cap-and-feathers, sword-and-spurs bought, Government House duly built and a suitable colonial servant duly appointed (at first styled ‘Administrator’, but a full-fledged Governor after 1971), the colony got shakily under way.
It has proved to be a quite extraordinary financial success—perhaps, in purely monetary terms, the most successful little country in the world. It is a success measured solely in numbers, maybe; the place has little charm, and even less culture; but in numbers—and that essentially means numbers of dollars—its triumph is unchallenged.
The islands are flat and, save for a modest hillock on Cayman Brac (‘brac’ is a Gaelic word for ‘bluff’, which on this islet is just 140 feet high), they are utterly featureless. Columbus spotted them in 1503, but decided not to bother landing, as they looked so uninspiring: he named them Las Tortugas, because of the enormous numbers of green turtles in the surrounding seas. They were renamed Las Caymanas because of the similar abundance of sea-crocodiles; but there are no crocodiles left today, and many islanders wish for the old name back, as the place still crawls with turtles.
The islanders—a mongrel mixture of races and nationalities, pirates and deserters, freebooters and buccaneers, a crew who knew no racial divisions then, and, almost alone in the West Indies, appear to harbour none today—built mahogany schooners, fished, and fattened turtles for export. But it was a poor living, and in the early years of this century hundreds left, to go to Jamaica, or even to Nicaragua, which lies temptingly close to the west. In 1948 there was just one bank on the island, and a collection of shanty towns and peasant farmers: the exchequer took in only thirty-six thousand pounds from the 7,000 inhabitants. They exported 2,000 turtles, at about three pounds a time; the total export income was twenty thousand pounds, and the Administrator had control of a Reserve Fund of thirty-eight thousand pounds, and a Hurricane Fund of two thousand. The soil was too thin to farm; the islands swarmed with mosquitoes, with dengue fever and yellow fever occasionally breaking out as epidemics; there were brackish swamps, acres of scrub and casuarina, and a few thin cattle. The Cayman Islands were a long way from being the brightest star in the Imperial firmament.
But a genius was waiting in the wings. Vassel Godfrey Johnson, a slender, bespectacled Jamaican whose family came from Madras, was a civil servant in the Finance Department in Jamaica. He came to Cayman during the debate over whether or not the island dependency should join the Federation; and, when it was decided that they should in fact become a new colony, separate and self-standing, he hit upon the solution that has since made the Caymans one of the wealthiest places on earth.
He explained that he had a sudden idea: since the islands were too poor to pay taxes, and since they were in the enviable position of being a British Crown colony, with all the stability and protection such status conferred—why not offer freedom from taxes to anyone who wanted to invest money on the islands? Why not encourage businesses to come and place their headquarters on Grand Cayman, and shelter themselves from the burdens of taxation they might face elsewhere? Why not offer secrecy and discretion, and make the islands into a Little Switzerland-on-Sea?
Mr Johnson worked for months, studying legislation and banking regulations, persuading the Jamaican Government, and then the Cayman Administration and the supervisors at the Foreign Office, that all would be well. By the time full colonial status was achieved the legislation was in force. The mosquitoes had been wiped out, too—Vassel Johnson had decided that bankers would not come to Grand Cayman if they were going to be made the subject of a Torquemada’s feast as soon as they stepped off the plane—and the colony was ready to receive its first millions.
It all took a little time. Bankers were reluctant to divert their monies from Zurich; American investors were content to keep their funds in Nassau, 500 miles north, in the Bahamas. There was a natural reluctance among this most cautious of communities to set down with funds in a new and untried country—British colony or not.
But then came the independence of the Bahamas, in 1974. The bankers were content with the Prime Minister whom the British left in charge; but within a year there were audible stirrings of Socialist opposition in Nassau, and the back streets were displaying posters calling for the nationalisation of the banks. Caution vanished; alarm took over; and banker after banker packed his suitcase and headed south, for Grand Cayman. Barclays Bank went first; and then a trickle, then a stream, and then a tidal wave. Banks from all over the world, from Winnipeg to Waziristan, set up shop in George Town.
The Yellow Pages in the Cayman telephone book lists six pages of banks, from the Arawak Trust (Cayman) Limited, to the Washington International Bank and Trust Company. Billions of dollars are invested in more than 440 banks registered in the Cayman Islands; and there are 300 insurance companies, dozens of world-class accountants, and more than 17,000 registered companies—one for every inhabitant. Outside the offices of most lawyers in town are long noticeboards listing the names of each and every company registered with the firm: pretty secretaries can be seen every day adding new plates to the list as fresh companies send in their government registration fee (of eight hundred and fifty dollars, minimum) and commence operations under the benign and liberal style of Caymanian protection.
Now, from a sleepy mess of mangrove swamps and seagrape trees, the Cayman Islands have undergone an amazing and breathtakingly rapid evolution. There are now more telex machines per head of population than anywhere else on earth; there were, in 1980, more than 8,000 telephones on the islands—one for every two people, and almost as many per person as in Britain. Satellite dishes have spawned like mushrooms all over the islands—when I met Vassel Johnson we did, indeed, sit under a seagrape tree beside the ocean, and there was driftwood on the beach and the sea shimmered in the late afternoon sun; but beside his house was a great white dish pointed up at Satcom Three, and he could receive fifty-three channels of television, twenty-four hours a day. He had a Mercedes and a motor cruiser, and there was a badminton court next to his bungalow. The standard of living he enjoyed was not, by island standards, particularly remarkable: but there was no poverty on Cayman either,
and none of the shabbiness I had encountered on Grand Turk, or on Anguilla, or Montserrat.
But the liberality of the Cayman laws has led, it is thought, to some abuse. The islands are generally thought of as the prime resting-place for some of the world’s hottest money—drug money, Mafia money, pornography money. It is rarely provable—the island laws make it a crime even to inquire about a certain bank account. But the island authorities seem to think it is happening, and have looked, without success, at ways of helping the very worried American police agencies who come to trace notorious criminals here, only to find the trail suddenly running cold, as though the fox had dived into the river, and had swum away to safety.
I stayed with an elderly couple in a grand house outside George Town; they were British and had come to retire on Cayman because of the sunshine, and the absolute certainty they felt that, of all places in the world, this would not become tainted by Socialism. They showed me their bank statement one day—a Barclays’ International statement, sent from the branch in George Town. It was of only minor interest until, quite by surprise, another statement fell from behind it. The Barclays’ computer had folded the statement for the next customer—next in alphabetical order, that is—into the same envelope. The customer was a small firm that hired cranes in a town in Yorkshire; it had more than four hundred and fifty thousand pounds on deposit, and I couldn’t help but wonder why. I thought I might telephone when I got home, and pretend I was a detective, and ask why they felt it necessary to keep so much cash in a Caribbean tax haven. But charity, and prudence, prevailed, and I left them alone.
The nervousness of the banking community showed itself after the Falklands War, and the Cayman Islands were briefly worried. There was talk, easily audible in New York and Miami and Houston, that the British might well want to dispose of their remaining colonies, to make sure no such costly embarrassment happened again. It was all rumour, of course—the reworking of a few editorials in the more radical quarters of the British press. But it set the bankers wondering—were the Cayman Islands secure? Should the money go to Switzerland once more, or to Liechtenstein, or Andorra?
The Governor of the islands, an astute Englishman named Peter Lloyd, a man with a long record of Imperial service—Fiji, Hong Kong, Bermuda, Kenya—recognised the danger signs. A royal visit should do the trick, it was agreed; and so the Queen, on her way to Mexico and the American West Coast, was briefly diverted to Grand Cayman in February 1983. It was expensive—two hundred dollars a minute, someone calculated. Her Majesty was given a Rolls-Royce that had once belonged to Mr Dubcek of Czechoslovakia; she unveiled a plaque for a new road, she saw an exhibition of local crafts (which, it must be said, are limited, and tend to involve turtle shells, conches, and raffia work), she made one seven-minute speech, spoke to some elderly islanders, performed one walkabout and lunched and dined with the island grandees. Government House was not reckoned either grand or secure enough for the Monarch; instead she slept at the headquarters of a company called Transnational Risk Management Limited, which everyone agreed had more the ring of today’s Cayman Islands about it, anyway.
Brief and costly though the tour had been, it underlined Britain’s determination to keep the colony British, come what may. The bankers expressed their relief and their gratitude, and growth resumed, as though the Falklands War had never happened. The islanders had already expressed their own thanks—a fund-raising campaign under the title ‘Mother needs your help’ was organised by the Caymanians to help the bereaved and the injured from the South Atlantic, and the Caymanians contributed to the tune of twenty-eight pounds each, indicative both of their generosity, and their wealth.
However, the Caymans are not particularly endearing islands. There is no scenery (except underwater, where the diving is said to be among the best in the world); there is a relentless quality to the money-making on which the islands seem so firmly based—seminars on tax-avoidance in every hotel, beach lectures on insurance, advertisements for Swiss banks and tax-shelters and financial advice centres. There is little left which is obviously West Indian about the place: it seems like an outpost of Florida, rather than of the British Empire, with a tawdriness, a mixture of the seedy and the greedy that was less attractive than the shabbiness or the decay of the other islands.
But that is a churlish judgement. The lives of the Caymanians are undoubtedly much more comfortable than those of their brother-islanders up in Tortola, or across in Montserrat. Why should I deny them a life that gives them such riches? What was it that bothered me about the place?
Perhaps, I thought to myself in the airport taxi, it was because one associates British Imperial relics, and associates them rather fondly, with sadness and decay, with the sagging verandah and the peeling paint, the wandering donkeys and the lolling drunks, and with a generally amiable sense of indolence and carelessness. It was not very laudable, maybe—but it was rather, well, pleasant, and cosy. Perhaps because of all of that, the discovery of a colony with 200 telexes and a telephone for every couple and seminars on investment opportunity, and moreover to discover it in a place like the West Indies where efficiency and technology and wealth have never been at a premium—perhaps it was all too much of a shock to the system. I was not, I must admit, at all sorry to leave. The plane took me to Miami, and it was full of men in business suits, and they seemed to be carrying small computer terminals, and read the Wall Street Journal. This, surely, had not been an outpost of our Empire? Where was the charm? Where was the Britishness of it all? They hadn’t even seemed terribly keen on cricket.
10
The Falkland Islands
10
The Falkland Islands
It was the first Friday in April—early spring in England, but a crisp clear autumn morning in Port Stanley, the capital of the Crown colony of the Falkland Islands. I was lying wedged under a bed, the Colonial Governor’s chauffeur had one of his feet in my left ear, a terrified cat was cowering under a pile of pink candlewick, and the sound of gunfire was everywhere. Britain’s very last Imperial war—although I didn’t know it at the time—was beginning, and I seemed to be in the very middle of it.
I had arrived three days earlier. This was the first colony I had visited for years, and I had fallen hopelessly in love with the place. Everything, so far as I was concerned, was exactly right. It was a place of islands, and I loved islands. It was cold, and I loved cold places. A fresh, damp wind blew constantly from the west. There was the smell of peat in the air. The grey and purple moors and the white-capped sea-lochs looked as though they had been plucked from the remoter regions of Argyllshire, or Ardnamurchan. The men, slow and deliberate of speech, pipe-smoking, church-going, all dressed in old tweed, oilskins and studded boots, made a modest living as seafarers and farmers; they knew about such things as Admiralty charts and weather and horses and birds and wild animals. They had the old and solid virtues of an earlier age—they were of the same stock as the ghillies and postmen and lobster fishers and shepherds of a seaside town in Northern Scotland, contented with their lonely living, wanting for little, happy to have been passed by and forgotten by the world outside.
And yet on this crisp Friday morning the whole unwanted outside world, with all its awfulness and wasted energies, was preparing to descend upon the Falkland Islands and their people. An Imperial outpost that had languished for two centuries in the comfort of well-deserved obscurity was about to erupt on to every newspaper and every television screen in every country in the world. A week from this day it would be on the front cover, in full colour, of the major American news magazines, would be the subject of a thousand televised discussions, a matter for urgent diplomacy and for the meetings of presidents, prime ministers, generals, admirals and intelligence chiefs in capital cities on every continent. This morning, at the very moment I had decided it would be sensible to lie on this strange bedroom floor, almost no one in the world was even aware of the existence of these islands, or of this tiny windswept capital town.
And
even as I mentioned this irony to the friend who sheltered beside me, a tragedy that was to alter the fortunes of the islands and the islanders for all time was under way, and we were hiding from it among the feet, the frightened cat and the rattle of bullets, among the dust balls and yellowing newspapers under a standard British government-issue bed.
I had come to the Falkland Islands from Simla, the old Imperial summer capital of India. Just a few days before I had been strolling through the grand viceregal lodge, up among the roses and the deodars, with the fine white ridge of the Himalayas in the distance. Then I heard the BBC World Service tell about some curious goings-on in the South Atlantic, with scrap metal merchants from Argentina trying to dismantle an old whaling station on the Falklands dependency of South Georgia, and the British Government being mightily exercised about it. I decided to go home. In the bus that took me from the hills to the plains I read what little there was in the Indian papers about the remote turmoil. It seemed that many of the old southern ocean whalers—and, indeed, the owners of the South Georgia whaling factory—were Scotsmen; and having just come from a building in India that had all the appearance of a magnificent Sutherland shooting lodge I was able to expatiate to the Bengali lawyer in the next seat on the theme the Scots as Empire-Builders, which at least matched his sermon on the Patriotism of Netaji Subhas Chandra Bose for length and tedium, after which we both fell into exhausted silences.
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