BERMUDA—A listless economy has meant $150 million trimmed from Bermuda’s budget, but a brighter outlook is expected later this year, according to Bermuda and U.S. officials.
“Clearly, the economy is sluggish, particularly on the tourism side,” said Bermuda Premier and Minister of Finance Paula A. Cox during a panel discussion at the seventh annual Bermuda Captive Conference. A slowdown of hotel projects has contributed to the slow recovery, she added.
Grace W. Shelton, U.S. Consul General, also on the panel, said the lull in the U.S. economy is lasting longer than expected. She added, however, that it “looks like the U.S. economy will gather speed in the second half of 2011.”
The U.S. and Bermuda have a very good relationship, Shelton said, noting that she meets on a regular basis with Cox, Bermuda business leaders, and leaders in science, education and other areas. The close relationship, which goes back centuries, continues no matter what party is in power in the U.S. or Bermuda, she said.
Asked if she plays a role in protecting U.S. business interest in Bermuda, Ms. Shelton said, “The answer is yes. Around the world, U.S. embassies and consulates engage in commercial diplomacy. We seek to protect U.S. interests. When I came to Bermuda, I started meeting with business leaders and I continue to do so.”
In each case, she said, she asks how things are going and if there is a role she can play. “They all respond that they have a very good dialogue with Premier Cox and her government and that there is openness and a willingness to discuss issues,” she said.
The U.S. government, she explained, is interested in promoting transparency and a level playing field, working with the government of Bermuda “as they deal with any possible shady financial dealings and in working on anti-money laundering,” she explained.
Jeremy Cox, CEO of the Bermuda Monetary Authority, noted that recently, when the European contingent was in Bermuda to examine its supervision over the insurance sector—part of Bermuda’s effort to gain equivalency to Solvency II—“one of the things we were trying to stress to them is that from a captive perspective, the U.S. is the most important market to Bermuda,” he said.
He added that 65-70 percent of Bermuda’s captive business emanates from the U.S.