Bermuda in worst economic slump for 80 years, report states

It said Bermuda must address the issue of competitiveness in key economic sectors and pull together to take advantage of the upturn in overseas economies.

The construction industry has suffered many job losses, but with the new hospital project, the report predicts a “very welcomed boom”.

It states: “The new hospital broke ground in January 2011 and will create more than 300 jobs over the duration of the project.

“This is a welcomed stimulus to this sector as other major projects, such as the Hamilton Police Station and Magistrates’ Court, are near completion.”

Recovery in 2011 will be “sluggish”, with the report stating: “While the U.S. recovery will boost service exports, there is a downside risk to growth from fragile private sector investment and consumption.

“Households will remain constrained in 2011 by job losses and pay curbs.”

There is good news for the economy — a projected 11 per cent increase in cruise ship passengers shows “cautious optimism” of a moderate recovery in the tourism sector.

The report also noted that while international business has been negatively impacted by the recession, the reinsurance and insurance markets remain strong in Bermuda.

It is believed international business will remain the “primary driver” of the Bermuda economy.

Regarding inflation, the report said that by the end of the year, it will likely remain stable and will be in the range of 2.5 to three per cent.