Bermuda was first discovered by Juan de Bermudez, the Spanish mariner, in 1505. It was claimed in England’s name by Sir George Somers, in July 1609. After colonization, the island prospered and has continued to do so almost continuously ever since. The tourist industry, catering particularly for the American market, began in Victorian times. Bermuda is the oldest British colony and there are still elements of British culture and customs in almost every aspect of life on the islands.
In 1968, the island was granted internal self-government – formally a British Dependent Territory
– while Britain retained control of defense and foreign policy. Bermudan political life revolves around two main political parties – the Progressive Labor Party (PLP), which has close links with the influential trade union movement, and the United Bermuda Party (UBP), dominated by professional and business interests. The UBP won a long string of elections from the mid-1970s until 1994. In November 1998, however, the PLP, with a substantial majority in the House of Assembly, formed a government under Premier Jennifer Smith. Inly July 2003, the PLP won a second term of government with current Premier W Alexander Scott.
The government’s recent agenda has been dominated by three issues. The first of these is the economy, which relies heavily on financial services and has grown steadily, despite competition from elsewhere in the region and external pressure to restrict possible money laundering. (This was a key factor behind the Labor victory in 1998 – party leader Jennifer Smith promised to resist external pressure on the country’s financial sector.) The second issue is independence – the most recent plebiscite on the issue took place in August 1995. A low turnout, produced a vote of 74 per cent against independence and in favor of remaining under British rule. The belief that the umbilical link with Britain guarantees stability and encourages foreign investment was sufficient to persuade the majority of the electorate. Third is the question of British citizenship – the British government still has to reach a final decision and it remains the subject of some irritation in the territory.
GovernmentBermuda is a British Dependent Territory. Its bicameral legislature – the Senate with 11 appointed members and the 40-member House of Assembly, elected by universal adult suffrage for a five-year term – is responsible for most internal affairs, although foreign policy and security matters are decided by the Governor (John Vereker, since 2002) who is appointed by and represents the British monarch. He in turn appoints the majority leader in the House of Assembly as Premier; the latter appoints the Cabinet.
EconomyBermuda’s economy is dominated by two industries – tourism and international business, including financial, insurance and re-insurance services. Together they account for approximately 90% of GDP.
Offshore banking and related services have been the mainstay of the financial sector, although in recent years, insurance has grown to the point where Bermuda is now the world’s third-largest insurance market. Tax receipts from several thousand offshore companies registered in Bermuda, plus customs duties, go some way to offsetting the island’s large annual visible trade deficit of around US$500 million.
The small light-manufacturing base in Bermuda is engaged in boat building, ship repair and perfume and pharmaceutical production. There is some agriculture, concentrated in the growing of fruit and vegetables, although most of Bermuda’s food is imported along with all its oil, machinery and most manufactured goods.
Bermuda has established an important diamond market. Most recently, real estate and rental has boomed, contributing 16% to the GDP in 2004.
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