November 25, 2008

Bermuda

Bermuda has developed a thriving economy based on financial services and tourism and now has the third-highest per capita income in the world, more than 50 percent higher than in the United States.

Bermuda means business

Ewart Brown, Premier

Premier Ewart Brown, Bermuda’s Head of State since 2006, says that while Bermuda’s economy, which is closely tied to that of the United States, will certainly be negatively affected by the current global financial crisis, the country’s business services and tourism sectors are well placed to weather the challenge. In a recent speech, he commented that in this period of global financial insecurity, “Bermuda’s international business sector, cemented in insurance and reinsurance, is well managed and continues to play a vitally important role in the world of risk management.”

Bermuda’s tourism sector is also on solid ground although the decrease in international air travel due to rising oil prices and financial woes will certainly affect this sector. As the Premier explains, “In addition to the United States market, source of 80 percent of our visitors, we have room for growth from Canada and Europe, London in particular, but airlines are reluctant to add routes these days.”

Paula Cox, Deputy Premier and Minister of Finance

Bermuda’s strategy is to create irresistible high-end offerings that will draw visitors even in an era of global financial challenges. It has launched what the Premier calls a “platinum period” of development focusing on luxury amenities. He says, “We have begun a phase of new hotel development, upgraded hotel properties, enhanced golf courses, and luxurious transportation options.” Bermuda’s great natural beauty, proximity to the United States, and welcoming population make it a natural for tourism development.

Brown urges American travelers to discover or re-discover everything that Bermuda offers as a tourism destination. He says, “We are blessed in Bermuda with natural beauty and we have worked to cultivate a first-class tourism industry. It’s a winning combination. It also doesn’t hurt that we are less than two hours from the United States. You can leave home after breakfast and be on the first tee here before lunch. What could be better than that?”

Bermuda Chamber of Commerce

“Bermuda is still in a growth stage.”

Philip Barnett, President

Bermuda is booming, as the construction cranes above the Hamilton skyline prove. The country’s per capita GDP has risen from USD 38,000 only a few years ago to today’s USD 84,000 and investors continue to target this business-friendly island nation. Now Bermuda is building even more cutting-edge infrastructure to support continued economic growth.

“Hamilton has many picturesque 200-year-old buildings, but the city definitely needs more high-level office space. Bermuda is still in a growth stage,” says Philip Barnett, President of the Bermuda Chamber of Commerce (BCC). He adds that the BCC is working to help maintain

Diane Gordon, Executive Vice President

Bermuda’s competitive advantage.

Bermuda’s niche over the past few years has been the re-insurance sector, and today the country is home to 13 of the world’s top re-insurers. Many foreign companies in other sectors have chosen to establish operations in Bermuda as well, thanks to its advantages as a business base. “Bermuda is a repository for knowledge workers, and it is a tax-free jurisdiction. It is also conveniently near the United States,” Barnett points out.

The BCC aims to make sure investors continue to target Bermuda, not just for ventures in financial services and insurance but also in tourism. “We want to promote more activity in the tourism sector. We believe the country should focus on upscale, high-end tourism rather than budget travel,” Barnett explains. He adds, “We want Bermuda to find a balance between tourism and international business.”

As for the impact on Bermuda of the credit crunch in the United States, Barnett notes that the two country’s economies are closely linked, but that Bermuda is currently experiencing strong growth, unlike the United States. He points out, “People say that if the United States sneezes, Bermuda catches a cold, but Bermuda is not in a recession. Property values here are as high as ever.”

Bermuda International Business Association

“Bermuda has a robust regulatory environment.”

The Bermuda International Business Association is bullish on Bermuda – and for good reason. As CEO Cheryl Packwood explains, Bermuda’s GDP has tripled since 2001 to reach per capita GDP of USD 84,000. “International business is the number one economic driver here, and Bermuda has been part of a growth explosion,” she says.

The Bermuda International Business Association is an organization of Bermuda-based international companies and financial services providers working together to promote Bermuda internationally and to enhance Bermuda’s business environment and its legal and regulatory framework. It works closely with the local government as well as the Bermuda Monetary Authority, concerning issues of importance to the business community. It also supports local education campaigns and sponsors a number of community-service projects.

United States is a privileged partner

Cheryl Packwood, CEO

Packwood points out that the United States is a privileged partner for Bermuda; the history between the two countries reaches back to before the United States achieved its independence. The reaction of Bermuda’s insurance sector to the events of 9/11 demonstrated Bermuda’s commitment to getting its work done and to supporting its ally to the north. “Bermuda is known to pay without fighting over it. We paid out on 9/11, a high marker for Bermuda, and we also insured telephone traffic after 9/11 so that East Coast communications were able to continue,” Packwood says.

The Bermuda International Business Association welcomes firms establishing operations or relocating to Bermuda, which has positioned itself as an ideal base for business. Packwood notes that when companies relocate to Bermuda, the result can be more jobs in the United States. She adds, “Here in Bermuda, we have expertise and brains, as well as a robust regulatory environment that is able to evolve to match the marketplace. We are also only 90 minutes from the United States. Bermuda has what Dubai lacks in terms of a long history of appropriate regulation, international recognition for quality and innovation, talent and expertise, together with an outstanding reputation as the premier jurisdiction for the institutional as well as private client worldwide.”