The Minister for the Cabinet Office, the Hon. Wayne Furbert, JP, MP, released the 2020 Gross Domestic Product (GDP) report from the Department of Statistics.
Minister Furbert explained, “As the public will appreciate, last year our economy was significantly challenged due to the pandemic. Like other countries around the world, Bermuda was not alone in seeing a decline in its annual GDP. However, it should be stressed that in response to the pandemic, and to assist individuals and businesses that had an immediate need for financial relief, the Government instituted several emergency measures last year.
“To assist employees who had been negatively impacted by the pandemic, on March 24, 2020, the Government implemented the Unemployment Benefit programme. This programme provided temporary relief to eligible workers who were left out of work as a direct result of public health measures related to COVID-19.
“Measures taken to assist businesses have included extending deadlines for tax filings and the deferring and waiving of fees, taxes, and penalties. Furthermore, payroll tax relief was provided to the restaurant and bar, taxi and hotel sectors, all of which were severely impacted by the stay at home measures that were put in place.
“And to effectively tackle our economic challenges in the long-term, the Government has introduce its Economic Recovery Plan (ERP) which is well underway. Bermuda’s ERP provides a blueprint for a successful recovery.”
As it relates to the annual GDP statistics, Bermuda’s economy contracted 6.9% in real terms in 2020. Thirteen of the 19 industry groups saw declines.
The Minister said, “Among the industries that recorded positive growth were Electricity, Water Supply and Waste Management, which grew by 17.8 % with cost savings on electricity production. This growth is due to both output and the cost of producing electricity falling. The fall in the cost of producing electricity was greater than the fall in output during the same period.
“International Business Activity rose 1.0 % while Wholesale and Retail Trade activity increased 0.7% due primarily to retail sales of food and liquor, which offset lower sales of clothing, fuel, electronic equipment and building materials.”
Of the declines, the Minister noted that tourist-dependent industries such as the Accommodation and Food Service industry faced losses, while tourism supporting industries such as the Transportation and Storage industry felt the knock on effects of a fall in visitor spending.
The GDP per capita at current prices fell by 7.3% to $107,435 at the end of 2020.
Minister Furbert continued, “Construction and Quarrying activity also saw declines during the second quarter of 2020 due to the public health restrictions in place.”
The Minister stressed that despite the challenges faced, the Government is committed to recovering Bermuda’s economy following the effects of the pandemic.
Minister Furbert said, “In March 2021, the Minister of Finance, Curtis Dickinson outlined a comprehensive Economic Recovery Plan for Bermuda.
“Preparatory work in Phase 1 involved identifying the objectives, the guiding principles and a preliminary list of initiatives. This work was undertaken in July through September 2020.”
Bermuda’s Economic Recovery Plan has 31 priority projects in 7 broad categories:
Ø Economic Diversification;
Ø Financial Markets;
Ø Infrastructure Investment;
Ø Expanding the Residential Population;
Ø Labour Market & Social Development;
Ø Healthcare Reform; and
Ø Regulatory Reform
Minister Furbert concluded, “We are pleased to note that nine of the 31 projects have been completed. Work continues on the others. These projects are considered the best programmes aimed at creating economic growth in the short to medium term, while meeting the objective of increasing jobs, diversifying our economy, and enhancing Bermuda’s infrastructure for the future.
“These initiatives will ensure that Bermuda forges a new path to growth, employment and greater equity.”
The public can learn more about the policies under the Economic Recovery Plan by visiting https://www.gov.bm/economicrecovery-updates.
To view the 2020 Annual GDP, visit https://www.gov.bm/annual-gross-domestic-product.
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