The island of Bermuda is situated in the North Atlantic Ocean, approximately 1,100 miles away from the state of Florida, in the United States of America. The island is relatively small, a mere 20 square miles, with a population of approximately 68,000. Until 1970 the island used the Bermudan Pound which has been replaced with the Bermudan Dollar and is pegged to the US Dollar. The Bermuda economy is quite strong thanks to several industries which have helped to keep it buoyant for many, many years.
Although it is in a relatively remote location in the Caribbean area of the world, this did not exclude the island of Bermuda from being part of the sugar cane production trade in the 16th century. This was the mainstay of the Bermuda economy for several centuries until it began to finally decline in the early 20th century. Since the end of World War II in 1949, Bermuda has enjoyed success in several other industries and sugar cane production is now a distant memory.
Financial Services in Bermuda
The biggest contributor to the Bermuda economy is the offshore financial services that the country provides to others. The big financial companies in countries such as the United Kingdom and the United States of America have their business in Bermuda and it is known as one of the most secure Caribbean territories in which to invest monies. This is probably due to the strict standards and monitoring of the Bermuda Financial Authority (BMA), who have also pushed for tighter legislation to help reduce the instances of money-laundering and financial fraud.
One of the biggest reasons that Bermuda is so popular with overseas businesses is because there is a fantastic tax system in place which means that companies can save a substantial amount of money. Bermuda is also a haven for those with stocks and securities as the Bermuda Stock Exchange is the largest completely electronic offshore securities market system in the world.
After international financial services, tourism is the second largest contributor to the Bermuda economy. The tourism industry was prominent in the 1990s but faced a decline coming into the 2000s. That said, the island still currently welcomes around half a million visitors each year and approximately 22% of the workforce is employed in the industry. It is predicted that as the strength of the financial services sector continues to grow, the Bermuda economy will rely less and less on the tourism sector.
Exports in Bermuda Economy
Areas that have remained stagnant on the island are those of agriculture and export. Indeed, most of the food that the island consumes is imported from countries such as America. This is partly because most of the land that could be used for agriculture has been built on, either for accommodation for the tourists or for business premises. The island also receives huge amounts of clothing, machinery and construction materials from international sources. The only real export that Bermuda has is the re-export of pharmaceuticals.
All-in-all the Bermuda economy is one of the strongest, if not the strongest, economy in the Caribbean region. It is believed that Bermuda has one of the highest GDP per capita rates in the world, even more than the United States. This is a strong position to be in and it would take a lot to topple the stable economy of this enigmatic island.