Bermuda: National Economic Report 2009
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S Coward
By S Coward
Published on 01-Mar-10
Hamilton -- March 1, 2010 -- Ministry of Finance estimates that Bermuda’s GDP may have contracted by as much as 2.5 per cent in 2009 following the small expansion of 0.7 per cent in 2008.
Hamilton -- March 1, 2010 -- Ministry of Finance estimates that Bermuda’s GDP may have contracted by as much as 2.5 per cent in 2009 following the small expansion of 0.7 per cent in 2008. All of the major economic indicators such as employment, balance of payments, visitor arrivals, construction activity and retail sales declined in 2009.
Employment fell by 1.8 per cent and unemployment was recorded at 4.5 per cent in 2009. In the international business sector, jobs declined by 6.9 per cent and the number of international companies registered fell by 1.5 per cent.
There was a similar picture in the tourism sector with employment in the hotels decreasing by 7.6 percent as air visitors fell by 10.5 per cent. It is estimated that the foreign exchange earnings provided by these two sectors declined by 2.7 per cent in the first three quarters of 2009.
Gross turnover in retail stores declined by 3.9 per cent in 2009 while the number of jobs in the sector fell by 2.2 percent. Between January and September 2009 the level of construction activity declined with the value of work put in place falling by 20.3 per cent and the value of new projects started falling by 49.3 per cent. Jobs in this industry fell by 4.2 per cent year over year.
The level of inflation in 2009 was relatively low which was a bright spot in the local economy as prices did not rise as quickly as in the past with the Consumer Price Index (CPI) measuring 1.8 per cent for the year.
In 2008 the Bermuda economy expanded 4.6 per cent based on current market prices. Nominal GDP was reported to be over $6.0 billion reflecting an increase of approximately $265.4 million over the 2007 revised estimate of $5.8 billion. When adjusted for inflation, the level of economic activity or real GDP increased by 0.7 per cent. This growth rate was well below the five year average (2004-2008) of 3.8 per cent.
This result was below the Ministry of Finance’s estimate (made in February 2009) of real growth in the range of 2.0 - 2.5 per cent. The less than anticipated expansion in the economy in 2008 may be attributed to the severity of the economic recession that had a negative impact across all leading industry sectors.
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Employment fell by 1.8 per cent and unemployment was recorded at 4.5 per cent in 2009. In the international business sector, jobs declined by 6.9 per cent and the number of international companies registered fell by 1.5 per cent.
There was a similar picture in the tourism sector with employment in the hotels decreasing by 7.6 percent as air visitors fell by 10.5 per cent. It is estimated that the foreign exchange earnings provided by these two sectors declined by 2.7 per cent in the first three quarters of 2009.
Gross turnover in retail stores declined by 3.9 per cent in 2009 while the number of jobs in the sector fell by 2.2 percent. Between January and September 2009 the level of construction activity declined with the value of work put in place falling by 20.3 per cent and the value of new projects started falling by 49.3 per cent. Jobs in this industry fell by 4.2 per cent year over year.
The level of inflation in 2009 was relatively low which was a bright spot in the local economy as prices did not rise as quickly as in the past with the Consumer Price Index (CPI) measuring 1.8 per cent for the year.
In 2008 the Bermuda economy expanded 4.6 per cent based on current market prices. Nominal GDP was reported to be over $6.0 billion reflecting an increase of approximately $265.4 million over the 2007 revised estimate of $5.8 billion. When adjusted for inflation, the level of economic activity or real GDP increased by 0.7 per cent. This growth rate was well below the five year average (2004-2008) of 3.8 per cent.
This result was below the Ministry of Finance’s estimate (made in February 2009) of real growth in the range of 2.0 - 2.5 per cent. The less than anticipated expansion in the economy in 2008 may be attributed to the severity of the economic recession that had a negative impact across all leading industry sectors.
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