Wayne Cowan: An ACE or an XL could be coming down here.

William McCullough: We have received applications from companies that intend to capitalise with anywhere from $200 to $500 million. Because of the exposure our earlier growth gave us, Cayman has a different image than was the case ten years ago. Because of that new image, others are looking at the Cayman Islands as a source of business in the future. If you had said to me three years ago that, in three years' time, we would have a company coming to us, capitalised at $500 million, I would have laughed at you - but that is what is happening.

George Craig: Whether or not we can cope with an influx from outside, the potential is there. Whether or not we can do it becomes less of a professional question and more of a socio-political question. We have an advantage over some other jurisdictions in the sense that we are a relatively young jurisdiction and, even with our explosion of financial services, we still have the potential to have new inspiration with different communities. On some levels that is very successful and on other levels it is not. Whether or not we can deal with the different challenges we are going to face will depend largely on how the jurisdiction, both in terms of Caymanians and professional expatriates, will actually try to integrate and work together. There are very real issues as to how to achieve that.

Bermuda, I think, did not achieve that. About a year ago, we saw a lot of people looking at us because they were very worried about the situation in Bermuda, and we said come down and see if you want to relocate. I think it would be very sad if we got to the stage, 15 years from now, where we became another Bermuda. There are certain conflicts of interest there, although there is also a certain will to move things forward in a cohesive way.

Roger Crombie: Is there any opposition in Cayman to the development of the island, to the transformation which is taking place?

Ian Kilpatrick: I have not seen any opposition within the financial industry. I have seen opposition to developments to the infrastructure: more hotels, more wetlands being used. Certainly, people are concerned about the environmental impact. I think Caymanians are more concerned about losing their identity with the continued influx of expatriates.

Steven Butler: I think Ian is right. The question a lot of people are asking is: All the new development that is going on, who is it for? And who is it bad for? Is the population at large, the Caymanian population, benefiting by these big advances? And that is really the political question that has to be addressed and solved over the next few years.

Ian Kilpatrick: We mentioned earlier how important it is that the people in the Cayman Islands benefit from this growth ù and fortunately, to date, they have. Everyone's standard of living has improved. Everybody who wants to work, I believe, is working. It is only those who do not want to work who are not. Hopefully, corporations are being responsible and trying to train Caymanians as far as they possibly can, to climb up the corporate ladder. There is a perception, I think, by many people that this is not happening, but I do not think that perception is right. I think there are certain exceptions, people who blatantly avoid hiring Caymanians, but that is very rare. Everybody would much prefer to have a Caymanian start working for them than to go to the expense and cost of bringing someone here.

George Craig: On an ongoing basis, we can certainly maintain this business and status we have now with very little ill-feeling, but going forward the one thing - again, the socio-political question - that would have to be achieved is not only a tangible benefit to the community, but also making sure that the community is a part of the success. By that I mean that, locally, people will, over a period of time, be able to stand side by side with the level of outside skill which we have imported. If we can achieve that, make Caymanians part of the generation of success, we will undoubtedly continue to grow.

William McCullough: There is a whole generation who are seeing their culture lost, but the new generation, they are the ones who see the opportunity and are wanting to progress.

George Craig: Historically, the view of our firm - and, I think, of others - in dealing with big international companies and deals has been to bring in people with big international reputations. There are two options: one is to train people locally and the other is to send people away. In the short term, a lot people were sent overseas to places like London to obtain their masters' degrees or other qualifications and then came back as equals. Otherwise, what is happening now is that there are proper training programmes in place to make sure that locals do progress through the ranks and have the same level of competence and intellectual ability as anyone else. It does not happen overnight, but there are now, in my profession, a number of extremely good attorneys on the island.

Wayne Cowan: Most firms, the insurance managers and the law firms and others, offer scholarships for the 17, 18 and 19 year-olds, so there is enormous opportunity.

William McCullough: I have worked in several emerging countries where young people have gone overseas for a period of training or scholarship, and have not wanted to go back to the country that they left, because the standards that they find in England or America are so much higher than they were at home. But that does not apply here, because standards here, the opportunities here, the salaries here - everything is geared to encourage them to come back. That is why I think they will come back and take up those opportunities that they perceive now are available to them.

Wayne Cowan: We must also ensure that the Caymanians who are moving into those positions are qualified to do the job and are not just given those positions without the necessary qualifications, because that would just reduce the standards. We cannot bring Caymanians into positions which they are not qualified to do, just as a sop to the Immigration Board or to the Caymanian community.

George Craig: All the organisations and professions on the island have had to, or in some cases still have to, invest in the local population and train and promote them properly. It is quite insulting to promote someone who is not ready for a position yet, simply to say that you have someone in that position. That is the wrong way to do it. The best way to do it is to say: Here is where you are going wrong; this is how we will improve you.And if the person cannot be improved, we will get someone who can be. That would apply to expatriates as well as to Caymanians. You set a universal standard, which is not easy to do, as professional organisations, then hopefully we will be ready to meet any challenges.

Tom Clark: This is a slight tangent to what we have been talking about, but when we talk about the development of the island, there is an ever increasing feeling that we should look after the environment. The financial business is actually a very green business. I do not know that we ever go out and tell people that, but the financial business does not affect the environment greatly. What it does is to bring some wealth to the island without detracting from the tourist sites. It allows people to have a higher standard of living so that they can look at the environment and enjoy it.

Roger Crombie: Is race an issue in Cayman, particularly with the international business sector bringing in so many foreigners?

Ian Kilpatrick: Absolutely not. Not an issue at all. I cannot be more emphatic. I think there are questions we have been discussing, such as: Are we being over-run? But I do not think it is a racial issue. It is certainly not based on the colour of one's skin.

Steven Butler: The island has been very lucky with the demographic split of the races. It is a very equal mix of people who live here and the wealth, to some extent, has been shared on all levels.

Roger Crombie: Let us close by talking about the future. Bill, we willstart with you and then go around the table. How do you see Cayman faring in the future?

William McCullough: I think that the insurance market is going to change in the new century and that change will be received much more easily, because of the type of people that we have here and the interest that everyone has. The unusual thing about Cayman is that all the managers here are competitive, certainly, but they do not compete for each other's business.

There is no antagonism between one manager and another, between one legal firm and another, to the same extent that you would find somewhere else. Everybody here has a common goal, for the best development of Cayman. And I think that because we have responded to change over the last few years, those changes are going to accelerate and I think we will be well placed for them.

As far as the regulatory department is concerned, we have spent the lastfew years that I have been here building up a team that knows about insurance. We do not have any bureaucrats on the team. That has been the intention. We have people experienced in property/casualty, life insurance, internal audit procedures and risk management and that is, I think, where our strength has been over the last few years. I am quite comfortable that the people we have will be able to take that forward.

John Pitcairn: I think the success of Cayman in previous years has been due to the private sector and public sector working very closely together to meet any challenges and I fully expect that co-operation to continue to meet future challenges and increase the success of the Cayman Islands.

Tom Clark: I am very bullish about the prospects for the financial industry in the Cayman Islands. I think there is a good infrastructure in place. We are seeing a lot of good young people coming out of school and up through the ranks. They will be able to service the business which is coming out here, which is very high quality business and I think that bodes very wellfor the future.

George Craig: As an attorney in the Cayman Islands, in terms of the insurance products and the insurance work I have been involved with over the past few years, I think this jurisdiction is second to none in its innovation and in its reception of new ideas. I think that is a key factor for growth, because ideas which we do not know about yet will come forward and we know how to react to them properly. As a professional in the Cayman Islands, I think this is an exceptional jurisdiction in that we have a North American attitude with a Commonwealth/UK knowledge of law, which to me is quite a formidable combination. In the past five or six years, we have been recruiting people into the profession who have such an extreme, cutting-edge knowledge of law across the board, as well as in the insurance area, so that I do not think we will have any difficulty in understanding and reacting to any of the insurance or financial products that may be developed in the future.

Wayne Cowan: I am certainly very optimistic. I think we have got excellent, high quality professionals, regulation that has been of the highest quality, that is not intrusive, and a lack of bureaucracy and red tape. We have legislation in place that is workable and, again, not intrusive. All of that indicates to me a very stable environment in which to conduct business.

Steven Butler: I would agree with the optimistic tone that everyone has adopted. I would add that Cayman is a great place to live and a great place for people to conduct their business. Where else could people go and meet their insurance managers, their accountants, their bankers, their lawyers and even the regulators, all in one day, or possibly even less than that?

Ian Kilpatrick: I tell everybody that I have lived here for 27 years and have sand between my toes - and no matter how many showers I take, it will not wash out. I also am bullish. I was very pleased to learn that government is going to make the world aware of the differences between tax evasion and tax avoidance, because if I had any concern, it would be that the smaller enterprises, of which I am one, might be seen to be not as important, so I am very encouraged by what has been said. I see no reason why we should not continue to flourish.

Roger Crombie is the Bermuda correspondent of Global Reinsurance and the editor of the Cayman Islands edition of Global Reinsurance. He is a member of the Institute of Chartered Accountants of England and Wales. E-mail:roger.crombie@globalreinsurance.com.