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Economy of Bermuda

February 01, 2023

Bermuda is a British Overseas Territory comprising a number of islands, with an area of 54 km2 (20.8 sq mi), located in the North Atlantic Ocean, which in 2016 had a population of 65,331.[1]

Houses in Bermuda.

Bermuda now has the fourth highest per capita incomes in the world,[2] primarily fueled by offshore financial services for non-resident firms, especially offshore insurance and reinsurance, and tourism. In 2014, 584,702 tourists visited the territory. Tourism accounts for an estimated 28% of gross domestic product (GDP), 85% of which is from North America. The industrial sector is small, and agriculture is now severely limited by a lack of suitable land. About 80% of food is imported. International business contributes over 60% of Bermuda's economic output. A failed independence vote in late 1995 can be partially attributed to Bermudian fears of scaring away foreign firms. Government economic priorities are for further strengthening of the tourist and international financial sectors.

History

Early-Season Vegetable Exports to USA Before World War II

 
Onion cultivations on Bermuda, 1895
 
One of the over 200 Bermuda lily fields in 1926.
 
Lawrence Ogilvie in his laboratory.

The major Bermuda industry since the 1800s was the export by sea of early vegetables and flowers to New York: Bermuda had three crops per year. The Bermuda Botanic Gardens (now with 38 acres) had been established in 1898.

In 1922, complete, concise and clear acts dealing with agriculture were placed on the Bermuda statute book; inspection of produce was initiated; and seed testing began. Local seedsmen were registered in 1923. Mr McCallan, the Agricultural Director, reorganised the Agricultural Exhibition for 1923. Seed potatoes were gradually improved after much investigation with US experts. A local farmers' market started in 1923. For a year in 1921–23, Professor H H Whetzel[3] of Cornell University advised remedies for the cash crop diseases of potato blight, onion thrips, celery leaf spot, lily Botritis, melon mildew etc. He suggested that the colony should appoint a full-time plant pathologist. During this time, exports of agricultural products to the United States contributed the most to Bermuda's economy.

Lawrence Ogilvie from Scotland was the Government's plant pathologist from September 1923 to April 1928. He introduced regulations in 1924 governing the control of local diseases and pests, and the import of plants – so vital for an island. Import embargoes applied for banana plants, lily bulbs, sweet potatoes, citrus fruits from the West Indies, and certain Irish potatoes. In 1924 a concrete fumigation chamber was built to fumigate infected imports. Good crops of celery were achieved in the 1920s. Citrus cultivation was affected by the Mediterranean fruit fly and only really developed in 1944.

1890s to 1920s Economy Badly Affected by Lily Virus in Over 200 Fields

The early Easter-lily bulb exports to New York and the Isle of Man — high-value and vital financially to Bermuda — became badly diseased from the late 19th century to the mid-1920s. In 1924 Lawrence Ogilvie (age 25) saved the industry by identifying the problem as a virus (not aphid damage as previously thought) and instituting controls in the fields and packing houses. There was a marked improvement in exporting 23 cases of lily bulbs in 1918 to 6043 cases in 1927 from the then 204 lily fields.[4] Still in his 20s, Ogilvie was professionally honoured by an article in Nature.[5] The lily export trade continued to flourish until the 1940s when the Japanese captured much of the market.

After World War II

Bermuda has had steady economic prosperity since the end of World War II, although the island has experienced recessions, including during the early 1990s, when the contraction of the economy led to a population reduction of 2,000 people (with work permits of many long-term residents not being renewed), and a mild recession in 2001–02, both paralleling recessions in the United States. Its economy is based primarily upon international business (especially re-insurance, for which it is now a world centre) and tourism, with those two sectors accounting for more than 70% of the total balance of payments current account foreign exchange receipts. However, the role of international business in the economy is expanding, whereas that of tourism is contracting.

Current economy

The Bermuda Monetary Authority (BMA) is an independent regulator of Bermuda's financial services sector, including the Bermuda Stock Exchange. The BMA is not a central bank, and does not provide lender of last resort facilities. The BMA has licensed two local banks: Butterfield Bank and the HSBC Bank Bermuda. In 2009, Butterfield had 51% of local deposits and HSBC had 41%.[6] Bermuda's currency is the Bermudian dollar, which is pegged to the US dollar on a one-to-one basis. Both currencies circulate in Bermuda on an equal basis, but the Bermudian dollar is not normally traded outside the territory. In May 2020 the Bermuda Government's debt stood at $2.68 billion and the debt limit was increased to $2.9 billion in response to COVID-19 related expenditures.[7] The BMA implemented Basel II in Bermuda from 1 January 2009 and Basel III from 1 January 2015, combined becoming the final rules for the enhancement of capital adequacy and liquidity in Bermuda's banking sector.[8]

In 2000, 19% of the population lived below the poverty line. The inflation rate (consumer prices) in 2005 was 2.8%. In 2004, 19% of the total labour force of 38,360 was in clerical occupations, 22% services, 3% labourers, 17% professional and technical, 15% administrative and managerial, 19% sales, and 3% agriculture and fishing; there was an unemployment rate of 2.1%.

In 2006, Bermuda's exports (mostly reexports of pharmaceuticals) were valued at $783m; export partners included Spain (13.8%), Germany (11.7%), Switzerland (8.8%), Denmark (6.6%), and the UK (6%).

In 2007, imports (of clothing, fuels, machinery and transport equipment, construction materials, chemicals, food, and live animals) were valued at $1.162bn; import partners included South Korea (36.4%), the US (15.7%), Germany (13.2%) and Italy (11.8%).

In 2018, Bermuda had a GDP of $7.263bn, and the GDP per capita was $111,540, with a real growth rate of 1.7%. In 2018 (est.), agriculture contributed 0.3% to GDP, industry 5%, and services 94.2%.[9] In 2018/19 actual government revenues were $1,090 million with a deficit of $77.8 million after $58.6 million capital expenditure[10] The major sources of Government revenue were: $467 million payroll tax and $226 million customs duties. Between 2008 and 2014 debt rose by 20% or more every year.[11] By 2020 net borrowings were $2.586 billion.[9] In September 2020 it was reported that "Bermuda faces a fiscal cliff if its debt-to-revenue ratio, currently at 340 per cent, continues to rise."[12] Annual debt interest is $127.1 million. $354 million of debt matures in January 2023. A further $402 million of debt matures in February 2024.[12]

Offshore financial services

Bermuda is considered an offshore financial centre. According to the Foot report, Bermuda is the second largest captive insurance domicile, and is the third largest reinsurance centre in the world.[13] It is the domicile of 6% of offshore funds (at 2010)[14] and has a presence in aircraft registration and maintains an open ship registry.

An October 2000 KPMG report titled "Review of Financial Regulation in the Caribbean Overseas Territories and Bermuda" stated that the island's legislative framework was not compliant with international standards, which led critics to conclude that Bermuda is committed to the facilitation of money laundering and other financial crimes. The Bermuda Government has since signed tax transparency and compliance agreements with the United States and Seychelles.[15]

In response to the KPMG October 2000 report, Bermuda enacted the Trust (Regulation of Trust Business) Act 2001 to transfer the finance minister's responsibilities to the BMA, with respect to granting and revoking trust company licences. It also requires all individuals or companies operating trust companies to have a licence unless they are exempt. Previously, only trust companies needed a licence. Additionally, the legislation gives the BMA more comprehensive intervention powers. It will be able to request more detailed documentation and, in the event of a problem, restrict a trust operator's licence. Information should be kept confidential, except in the event of a criminal investigation.

Comprehensive new legislation[clarification needed] will be introduced in the upcoming[when?] parliamentary session to further streamline the incorporation process, facilitate registration of foreign names and address conflicts in law for registered securities, again consistent with the KPMG report. Amendments are being proposed to the BMA (Collective Investment Scheme Classification) Regulations 1998, part of a strategic plan for the development of financial services in Bermuda.

Foreign companies

Most foreign companies in Bermuda are incorporated under the Companies Act of 1981. Bermuda-registered companies need only one director and one shareholder, who can be the same person, and neither needs to be resident in Bermuda. Most companies do not need to file financial accounts or annual returns. Business records can be maintained outside the territory. A company need only file an annual declaration, which lists the authorized share capital, which is the basis for determining the annual fee. (See Taxation in Bermuda#Licence fees.) Foreign companies require a local secretary and agent, which charges a fee. Foreign companies that wish to establish a place of business in Bermuda require a permit, but a permit is not required for offshore activities. There are no taxes on profits, income, dividends, capital gains, estate, or death duties.

There are more than 12,500 foreign companies registered in Bermuda, many US-owned, which are an important source of foreign exchange for the island. Offshore companies spent US$967m in Bermuda in 2000. Total income, including secondary effects, was US$1.3bn. Many large international companies are based in Bermuda, including Bacardi Ltd., Bunge Limited, Jardine Matheson Holdings Ltd., Global Crossing Ltd. and Royall Lyme Bermuda Ltd. Some companies, however, are considering or planning a move to Ireland in search of "a more stable environment", including Willis Group.[16]

The growing importance of international business is reflected in its increased share of GDP, which grew from 12.6% in 1996 to 13.8% in 2000. In 2000, foreign companies directly employed 3,224 Bermudians and non-Bermudians. Foreign companies directly and indirectly supported 9,450 jobs in Bermuda and strongly influenced a further 4,670.

The Bermuda Department of Maritime Administration maintains an open ship registry,[17] enabling foreign-owned ships to be registered in Bermuda, fly its flag, and be subject to its maritime and taxation laws. It is considered a flag of convenience state. In 2012, 139 vessels were registered in Bermuda[18] of which 105 were foreign-owned[18] (76%). 160 ships were registered in 2017, including 18 oil tankers, 10 bulk carriers, 8 container ships, and one general cargo ship.[18] Thirteen of the 17 ships of the Princess Cruises line are registered in Bermuda, as are seven of the eight ships of the P&O Cruises line. In 2011, the Cunard Line registered all its ships in Bermuda to enable its ship captains to marry couples at sea, weddings at sea being described as a lucrative market. The move brought in additional hundreds of thousands in annual fees to a registry that already takes in about $3 million a year.[19][20]

Bermuda is notable for its open aircraft register.

Tourism

 
The Hamilton Hotel in 1875

Tourism is Bermuda's third most important industry. That it is an industry in trouble is evident from the statistical comparison. In 1996, Bermuda had 571,700 visitors. By 2000, that figure has dropped to 538,059 visitors, and further decreased to 454,444 visitors in 2001. Bed nights sold declined from over 2.4 million in 1995 to 1.9 million in 2001. Visitors contributed an estimated $475 million to the economy in 1996, but that figure declined to $431 million in 2000. Direct employment in the tourism industry (5,700 jobs in 2000) and related industry is dropping in tandem with declining visitor numbers.

Following the September 11, 2001 attacks in the United States, a number of new re-insurance companies located to the island, contributing to an already robust international business sector. On the other hand, Bermuda's already weakening tourism industry was hit hard, as American tourists chose not to travel.

Total arrivals in 2014 were 584,702 out of which air arrivals were 224,329 (down by 5.1%), cruise arrivals were 356,093 (up by 4.7%), and yacht arrivals were 4,280 (up by 24.6%).

In 2018, Bermuda experienced its most visitor arrivals ever with a record number of 770,683 visitor arrivals. With 203,697 leisure air arrivals in 2018, Bermuda experienced its best performance since 2002, a year which recorded 218,248 leisure travellers by air. Total leisure spending between air and cruise was $411 million in 2018, up from $320 million in 2017. Cruise arrivals were also up by 34% in 2018 for non-summer months (September through May).[21]

Population and labour

The population of Bermuda on census night, 20 May 2010, was 71,328 persons (an increase of 7% over 2000), comprising 59,014 civilians, 822 persons in institutions and 11,492 visitors and transients (an increase of 38%), including those on board cruise ships and yachts. There were 64,319 persons usually resident in Bermuda (i.e., including those temporarily out of the territory), an increase of 4% or 2,178 persons. About 79% of Bermuda's 2010 resident population has Bermudian status and 21% does not. Bermudian status arises by birth, grant or marriage. There were three cruise ships in Bermuda on census night compared to one at the 2000 census.[22] According to the 1991 census, about 73% of Bermuda's 1991 resident population was born in Bermuda and 27% was foreign-born. UK immigrants constituted 30.6% of the immigrant population; U.S., 19.9%; Canada, 10.5%; and Portugal and the Azores, 13.5%. In 2016 Bermuda had a resident population of 65,331.[1]

Total filled jobs in 2000 were 38,017, but preliminary estimates for 2001 revealed a 1.1% decline in employment. Nevertheless, unemployment remained in the 4% range, and many Bermudians held more than one job. In 2000, about 25% of workers were union members. There are three primary unions in Bermuda: the blue-collar Bermuda Industrial Union, Bermuda's largest labour organisation; the professional Bermuda Public Services Association, with a steadily increasing membership; and the Bermuda Union of Teachers, which is affiliated with the Caribbean Union of Teachers.

Organised labour enjoys a high profile in Bermuda. Union action, however, was moderate in recent years. The average days lost per worker involved dropped from a high of 65 in 1991 to a low of 0.8 in 1999. Although still active, unions have tempered their demands, partly as a result of new labour legislation and partly in recognition that Bermuda's economy, in line with that of the United States, entered a recessionary phase in 2001. The island's tourism industry, in which many Bermudians have historically been employed, continues to experience tough times, made even worse by 11 September. Past industrial action in the tourism sector hurt that industry, which was already suffering a chronic downturn without the additional blow of tourist displeasure and displacement due to work stoppages.

Foreign trade

Bermuda has little in the way of exports or manufacturing, and almost all manufactured goods and foodstuffs must be imported. The value of imports continues to rise, up from US$551m in 1994 to US$712m in 1999. The U.S. is Bermuda's primary trading partner; from a value of US$400m in 1994, U.S. imports expanded to US$533m in 2000. The United Kingdom, Canada, Seychelles and the Caribbean countries (mainly the Netherlands Antilles) also are important trading partners. Exports from Bermuda, including imports into the small free port, which are subsequently re-exported, increased from US$35m in 1993 to almost US$51m in 1999.

Duty on imports is a major source of revenue for the Government of Bermuda. In fiscal year 1998–99, the government obtained slightly more than $166 million, or about 30% of its revenue base from imports. Heavy importation duties are reflected in retail prices. Although Bermuda imposes no income, sales, or profit taxes, it does levy a real estate tax and a payroll tax.

See also

References

  1. ^ a b Google maps - Bermuda
  2. ^ "Bermuda: Economy". globaledge.msu.edu. Retrieved 2021-10-07.
  3. ^ Seaver, F. J.; Waterston, J. M. (1946). "Contributions to the Mycoflora of Bermuda: IV". Mycologia. 38 (2): 180. doi:10.2307/3755060. ISSN 0027-5514. JSTOR 3755060.
  4. ^ October 1928 Monthly Bulletin of the Bermuda Department of Agriculture and Fisheries article by Lawrence Ogilvie
  5. ^ Nature number 2997, 9 April 1927, page 52
  6. ^ Jonathan Kent (2009-05-16). "S&P revises Island's ratings outlook to negative". The Royal Gazette. Retrieved 2010-10-03.[permanent dead link]
  7. ^ . Archived from the original on 2020-05-16. Retrieved 2020-05-09.
  8. ^ "HSBC in Bermuda - About HSBC | HSBC Bermuda".
  9. ^ a b "Bermuda Government National Economic Report" (PDF). Retrieved 10 March 2021.
  10. ^ "Bermudan Government Budget Book" (PDF). Retrieved 10 March 2021.
  11. ^ . Archived from the original on 2019-09-10. Retrieved 2020-05-09.
  12. ^ a b "Warning that Bermuda could face 'fiscal cliff'". Royal Gazette. 21 January 2021. Retrieved 10 March 2021.
  13. ^ . HM Treasury. 2009-10-29. Archived from the original on 2009-11-18. Retrieved 2011-03-31.
  14. ^ (PDF). Oliver Wyman. p. 3. Archived from the original (PDF) on 14 July 2014. Retrieved 13 July 2014.. Figures are for 2010.
  15. ^ david.wellman (2017-12-11). "Government of Bermuda Signs Tax Agreement with the United States IRS". www.gov.bm. Retrieved 2021-05-25.
  16. ^ "Willis moves tax base here ahead of US curbs".
  17. ^ Bermuda Department of Maritime Administration
  18. ^ a b c CIA World Factbook, Bermuda, Transportation. Access date 2012-05-03.
  19. ^ Jonathan Bell (21 October 2011). . Royalgazette.com. Archived from the original on 9 May 2012. Retrieved 7 November 2012.
  20. ^ . Archived from the original on 2018-01-22. Retrieved 2018-01-22.
  21. ^ "2018 Visitor Arrivals Report Full Year" (PDF). Retrieved February 12, 2020.
  22. ^ Bermuda Department of Statistics. 2010 Census - Population and Housing.

February 01, 2023
economy, bermuda, parts, this, article, those, related, history, economy, since, 2009, need, updated, please, help, update, this, article, reflect, recent, events, newly, available, information, september, 2013, bermuda, british, overseas, territory, comprisin. Parts of this article those related to the history of the economy since 2009 need to be updated Please help update this article to reflect recent events or newly available information September 2013 Bermuda is a British Overseas Territory comprising a number of islands with an area of 54 km2 20 8 sq mi located in the North Atlantic Ocean which in 2016 had a population of 65 331 1 Houses in Bermuda Bermuda now has the fourth highest per capita incomes in the world 2 primarily fueled by offshore financial services for non resident firms especially offshore insurance and reinsurance and tourism In 2014 584 702 tourists visited the territory Tourism accounts for an estimated 28 of gross domestic product GDP 85 of which is from North America The industrial sector is small and agriculture is now severely limited by a lack of suitable land About 80 of food is imported International business contributes over 60 of Bermuda s economic output A failed independence vote in late 1995 can be partially attributed to Bermudian fears of scaring away foreign firms Government economic priorities are for further strengthening of the tourist and international financial sectors Contents 1 History 1 1 Early Season Vegetable Exports to USA Before World War II 1 2 1890s to 1920s Economy Badly Affected by Lily Virus in Over 200 Fields 1 3 After World War II 2 Current economy 3 Offshore financial services 4 Foreign companies 5 Tourism 6 Population and labour 7 Foreign trade 8 See also 9 ReferencesHistory EditEarly Season Vegetable Exports to USA Before World War II Edit Onion cultivations on Bermuda 1895 One of the over 200 Bermuda lily fields in 1926 Lawrence Ogilvie in his laboratory The major Bermuda industry since the 1800s was the export by sea of early vegetables and flowers to New York Bermuda had three crops per year The Bermuda Botanic Gardens now with 38 acres had been established in 1898 In 1922 complete concise and clear acts dealing with agriculture were placed on the Bermuda statute book inspection of produce was initiated and seed testing began Local seedsmen were registered in 1923 Mr McCallan the Agricultural Director reorganised the Agricultural Exhibition for 1923 Seed potatoes were gradually improved after much investigation with US experts A local farmers market started in 1923 For a year in 1921 23 Professor H H Whetzel 3 of Cornell University advised remedies for the cash crop diseases of potato blight onion thrips celery leaf spot lily Botritis melon mildew etc He suggested that the colony should appoint a full time plant pathologist During this time exports of agricultural products to the United States contributed the most to Bermuda s economy Lawrence Ogilvie from Scotland was the Government s plant pathologist from September 1923 to April 1928 He introduced regulations in 1924 governing the control of local diseases and pests and the import of plants so vital for an island Import embargoes applied for banana plants lily bulbs sweet potatoes citrus fruits from the West Indies and certain Irish potatoes In 1924 a concrete fumigation chamber was built to fumigate infected imports Good crops of celery were achieved in the 1920s Citrus cultivation was affected by the Mediterranean fruit fly and only really developed in 1944 1890s to 1920s Economy Badly Affected by Lily Virus in Over 200 Fields Edit The early Easter lily bulb exports to New York and the Isle of Man high value and vital financially to Bermuda became badly diseased from the late 19th century to the mid 1920s In 1924 Lawrence Ogilvie age 25 saved the industry by identifying the problem as a virus not aphid damage as previously thought and instituting controls in the fields and packing houses There was a marked improvement in exporting 23 cases of lily bulbs in 1918 to 6043 cases in 1927 from the then 204 lily fields 4 Still in his 20s Ogilvie was professionally honoured by an article in Nature 5 The lily export trade continued to flourish until the 1940s when the Japanese captured much of the market After World War II Edit Bermuda has had steady economic prosperity since the end of World War II although the island has experienced recessions including during the early 1990s when the contraction of the economy led to a population reduction of 2 000 people with work permits of many long term residents not being renewed and a mild recession in 2001 02 both paralleling recessions in the United States Its economy is based primarily upon international business especially re insurance for which it is now a world centre and tourism with those two sectors accounting for more than 70 of the total balance of payments current account foreign exchange receipts However the role of international business in the economy is expanding whereas that of tourism is contracting Current economy EditThe Bermuda Monetary Authority BMA is an independent regulator of Bermuda s financial services sector including the Bermuda Stock Exchange The BMA is not a central bank and does not provide lender of last resort facilities The BMA has licensed two local banks Butterfield Bank and the HSBC Bank Bermuda In 2009 Butterfield had 51 of local deposits and HSBC had 41 6 Bermuda s currency is the Bermudian dollar which is pegged to the US dollar on a one to one basis Both currencies circulate in Bermuda on an equal basis but the Bermudian dollar is not normally traded outside the territory In May 2020 the Bermuda Government s debt stood at 2 68 billion and the debt limit was increased to 2 9 billion in response to COVID 19 related expenditures 7 The BMA implemented Basel II in Bermuda from 1 January 2009 and Basel III from 1 January 2015 combined becoming the final rules for the enhancement of capital adequacy and liquidity in Bermuda s banking sector 8 In 2000 19 of the population lived below the poverty line The inflation rate consumer prices in 2005 was 2 8 In 2004 19 of the total labour force of 38 360 was in clerical occupations 22 services 3 labourers 17 professional and technical 15 administrative and managerial 19 sales and 3 agriculture and fishing there was an unemployment rate of 2 1 In 2006 Bermuda s exports mostly reexports of pharmaceuticals were valued at 783m export partners included Spain 13 8 Germany 11 7 Switzerland 8 8 Denmark 6 6 and the UK 6 In 2007 imports of clothing fuels machinery and transport equipment construction materials chemicals food and live animals were valued at 1 162bn import partners included South Korea 36 4 the US 15 7 Germany 13 2 and Italy 11 8 In 2018 Bermuda had a GDP of 7 263bn and the GDP per capita was 111 540 with a real growth rate of 1 7 In 2018 est agriculture contributed 0 3 to GDP industry 5 and services 94 2 9 In 2018 19 actual government revenues were 1 090 million with a deficit of 77 8 million after 58 6 million capital expenditure 10 The major sources of Government revenue were 467 million payroll tax and 226 million customs duties Between 2008 and 2014 debt rose by 20 or more every year 11 By 2020 net borrowings were 2 586 billion 9 In September 2020 it was reported that Bermuda faces a fiscal cliff if its debt to revenue ratio currently at 340 per cent continues to rise 12 Annual debt interest is 127 1 million 354 million of debt matures in January 2023 A further 402 million of debt matures in February 2024 12 Offshore financial services EditThis section needs additional citations for verification Please help improve this article by adding citations to reliable sources Unsourced material may be challenged and removed Find sources Economy of Bermuda news newspapers books scholar JSTOR August 2019 Learn how and when to remove this template message Bermuda is considered an offshore financial centre According to the Foot report Bermuda is the second largest captive insurance domicile and is the third largest reinsurance centre in the world 13 It is the domicile of 6 of offshore funds at 2010 14 and has a presence in aircraft registration and maintains an open ship registry An October 2000 KPMG report titled Review of Financial Regulation in the Caribbean Overseas Territories and Bermuda stated that the island s legislative framework was not compliant with international standards which led critics to conclude that Bermuda is committed to the facilitation of money laundering and other financial crimes The Bermuda Government has since signed tax transparency and compliance agreements with the United States and Seychelles 15 In response to the KPMG October 2000 report Bermuda enacted the Trust Regulation of Trust Business Act 2001 to transfer the finance minister s responsibilities to the BMA with respect to granting and revoking trust company licences It also requires all individuals or companies operating trust companies to have a licence unless they are exempt Previously only trust companies needed a licence Additionally the legislation gives the BMA more comprehensive intervention powers It will be able to request more detailed documentation and in the event of a problem restrict a trust operator s licence Information should be kept confidential except in the event of a criminal investigation Comprehensive new legislation clarification needed will be introduced in the upcoming when parliamentary session to further streamline the incorporation process facilitate registration of foreign names and address conflicts in law for registered securities again consistent with the KPMG report Amendments are being proposed to the BMA Collective Investment Scheme Classification Regulations 1998 part of a strategic plan for the development of financial services in Bermuda Foreign companies EditMost foreign companies in Bermuda are incorporated under the Companies Act of 1981 Bermuda registered companies need only one director and one shareholder who can be the same person and neither needs to be resident in Bermuda Most companies do not need to file financial accounts or annual returns Business records can be maintained outside the territory A company need only file an annual declaration which lists the authorized share capital which is the basis for determining the annual fee See Taxation in Bermuda Licence fees Foreign companies require a local secretary and agent which charges a fee Foreign companies that wish to establish a place of business in Bermuda require a permit but a permit is not required for offshore activities There are no taxes on profits income dividends capital gains estate or death duties There are more than 12 500 foreign companies registered in Bermuda many US owned which are an important source of foreign exchange for the island Offshore companies spent US 967m in Bermuda in 2000 Total income including secondary effects was US 1 3bn Many large international companies are based in Bermuda including Bacardi Ltd Bunge Limited Jardine Matheson Holdings Ltd Global Crossing Ltd and Royall Lyme Bermuda Ltd Some companies however are considering or planning a move to Ireland in search of a more stable environment including Willis Group 16 The growing importance of international business is reflected in its increased share of GDP which grew from 12 6 in 1996 to 13 8 in 2000 In 2000 foreign companies directly employed 3 224 Bermudians and non Bermudians Foreign companies directly and indirectly supported 9 450 jobs in Bermuda and strongly influenced a further 4 670 The Bermuda Department of Maritime Administration maintains an open ship registry 17 enabling foreign owned ships to be registered in Bermuda fly its flag and be subject to its maritime and taxation laws It is considered a flag of convenience state In 2012 139 vessels were registered in Bermuda 18 of which 105 were foreign owned 18 76 160 ships were registered in 2017 including 18 oil tankers 10 bulk carriers 8 container ships and one general cargo ship 18 Thirteen of the 17 ships of the Princess Cruises line are registered in Bermuda as are seven of the eight ships of the P amp O Cruises line In 2011 the Cunard Line registered all its ships in Bermuda to enable its ship captains to marry couples at sea weddings at sea being described as a lucrative market The move brought in additional hundreds of thousands in annual fees to a registry that already takes in about 3 million a year 19 20 Bermuda is notable for its open aircraft register Tourism Edit The Hamilton Hotel in 1875 Tourism is Bermuda s third most important industry That it is an industry in trouble is evident from the statistical comparison In 1996 Bermuda had 571 700 visitors By 2000 that figure has dropped to 538 059 visitors and further decreased to 454 444 visitors in 2001 Bed nights sold declined from over 2 4 million in 1995 to 1 9 million in 2001 Visitors contributed an estimated 475 million to the economy in 1996 but that figure declined to 431 million in 2000 Direct employment in the tourism industry 5 700 jobs in 2000 and related industry is dropping in tandem with declining visitor numbers Following the September 11 2001 attacks in the United States a number of new re insurance companies located to the island contributing to an already robust international business sector On the other hand Bermuda s already weakening tourism industry was hit hard as American tourists chose not to travel Total arrivals in 2014 were 584 702 out of which air arrivals were 224 329 down by 5 1 cruise arrivals were 356 093 up by 4 7 and yacht arrivals were 4 280 up by 24 6 In 2018 Bermuda experienced its most visitor arrivals ever with a record number of 770 683 visitor arrivals With 203 697 leisure air arrivals in 2018 Bermuda experienced its best performance since 2002 a year which recorded 218 248 leisure travellers by air Total leisure spending between air and cruise was 411 million in 2018 up from 320 million in 2017 Cruise arrivals were also up by 34 in 2018 for non summer months September through May 21 Population and labour EditThe population of Bermuda on census night 20 May 2010 was 71 328 persons an increase of 7 over 2000 comprising 59 014 civilians 822 persons in institutions and 11 492 visitors and transients an increase of 38 including those on board cruise ships and yachts There were 64 319 persons usually resident in Bermuda i e including those temporarily out of the territory an increase of 4 or 2 178 persons About 79 of Bermuda s 2010 resident population has Bermudian status and 21 does not Bermudian status arises by birth grant or marriage There were three cruise ships in Bermuda on census night compared to one at the 2000 census 22 According to the 1991 census about 73 of Bermuda s 1991 resident population was born in Bermuda and 27 was foreign born UK immigrants constituted 30 6 of the immigrant population U S 19 9 Canada 10 5 and Portugal and the Azores 13 5 In 2016 Bermuda had a resident population of 65 331 1 Total filled jobs in 2000 were 38 017 but preliminary estimates for 2001 revealed a 1 1 decline in employment Nevertheless unemployment remained in the 4 range and many Bermudians held more than one job In 2000 about 25 of workers were union members There are three primary unions in Bermuda the blue collar Bermuda Industrial Union Bermuda s largest labour organisation the professional Bermuda Public Services Association with a steadily increasing membership and the Bermuda Union of Teachers which is affiliated with the Caribbean Union of Teachers Organised labour enjoys a high profile in Bermuda Union action however was moderate in recent years The average days lost per worker involved dropped from a high of 65 in 1991 to a low of 0 8 in 1999 Although still active unions have tempered their demands partly as a result of new labour legislation and partly in recognition that Bermuda s economy in line with that of the United States entered a recessionary phase in 2001 The island s tourism industry in which many Bermudians have historically been employed continues to experience tough times made even worse by 11 September Past industrial action in the tourism sector hurt that industry which was already suffering a chronic downturn without the additional blow of tourist displeasure and displacement due to work stoppages Foreign trade EditBermuda has little in the way of exports or manufacturing and almost all manufactured goods and foodstuffs must be imported The value of imports continues to rise up from US 551m in 1994 to US 712m in 1999 The U S is Bermuda s primary trading partner from a value of US 400m in 1994 U S imports expanded to US 533m in 2000 The United Kingdom Canada Seychelles and the Caribbean countries mainly the Netherlands Antilles also are important trading partners Exports from Bermuda including imports into the small free port which are subsequently re exported increased from US 35m in 1993 to almost US 51m in 1999 Duty on imports is a major source of revenue for the Government of Bermuda In fiscal year 1998 99 the government obtained slightly more than 166 million or about 30 of its revenue base from imports Heavy importation duties are reflected in retail prices Although Bermuda imposes no income sales or profit taxes it does levy a real estate tax and a payroll tax See also EditBermuda Stock Exchange Nuclear Electric Insurance Limited Oil Insurance Limited Arch Capital Group Bermuda TriangleReferences Edit a b Google maps Bermuda Bermuda Economy globaledge msu edu Retrieved 2021 10 07 Seaver F J Waterston J M 1946 Contributions to the Mycoflora of Bermuda IV Mycologia 38 2 180 doi 10 2307 3755060 ISSN 0027 5514 JSTOR 3755060 October 1928 Monthly Bulletin of the Bermuda Department of Agriculture and Fisheries article by Lawrence Ogilvie Nature number 2997 9 April 1927 page 52 Jonathan Kent 2009 05 16 S amp P revises Island s ratings outlook to negative The Royal Gazette Retrieved 2010 10 03 permanent dead link Minister Updates on Covid 19 Economic Plan Bernews Archived from the original on 2020 05 16 Retrieved 2020 05 09 HSBC in Bermuda About HSBC HSBC Bermuda a b Bermuda Government National Economic Report PDF Retrieved 10 March 2021 Bermudan Government Budget Book PDF Retrieved 10 March 2021 Budget 2016 Scaling a dangerous debt mountain the Royal Gazette Bermuda Politics Archived from the original on 2019 09 10 Retrieved 2020 05 09 a b Warning that Bermuda could face fiscal cliff Royal Gazette 21 January 2021 Retrieved 10 March 2021 Michael Foot publishes final report HM Treasury 2009 10 29 Archived from the original on 2009 11 18 Retrieved 2011 03 31 Domiciles of Alternative Investment Funds PDF Oliver Wyman p 3 Archived from the original PDF on 14 July 2014 Retrieved 13 July 2014 Figures are for 2010 david wellman 2017 12 11 Government of Bermuda Signs Tax Agreement with the United States IRS www gov bm Retrieved 2021 05 25 Willis moves tax base here ahead of US curbs Bermuda Department of Maritime Administration a b c CIA World Factbook Bermuda Transportation Access date 2012 05 03 Jonathan Bell 21 October 2011 Luxury cruise ship line Cunard switches to Bermuda registry Bermuda News Royalgazette com Archived from the original on 9 May 2012 Retrieved 7 November 2012 Cruise Line Awaiting Further Updates On Law Archived from the original on 2018 01 22 Retrieved 2018 01 22 2018 Visitor Arrivals Report Full Year PDF Retrieved February 12 2020 Bermuda Department of Statistics 2010 Census Population and Housing This article incorporates public domain material from World Factbook CIA This article incorporates public domain material from U S Bilateral Relations Fact Sheets United States Department of State Retrieved from https en wikipedia org w index php title Economy of Bermuda amp oldid 1132407049, wikipedia, wiki, book, books, library,

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