Cayman funds shortage

A UK newspaper is reporting that the government of the Cayman Islands may be heading toward bankruptcy.



According to The Guardian, the British government last week refused to bail out the Cayman Islands, which wanted approval to borrow $310 million from banks.



A Foreign Office minister is said to have demanded the British territory cut its borrowing and debt and even consider introducing income and property taxes for residents.



A tax-free system has helped the territory become the world\'s fifth largest financial centre.



The paper also said the Cayman government was struggling to pay its bills to suppliers.