News

S&P Affirms Bermuda Rating; Outlook Remains Negative

By: Caribbean Journal Staff - April 2, 2014

Above: Bermuda

By the Caribbean Journal staff

New York-based Standard & Poor’s has affirmed its AA-/A-1+ rating on Bermuda, the ratings firm announced this week.

The British Overseas Territory’s outlook remains negative, however, it said.

“The ratings on Bermuda are supported by our view of the country’s ongoing achievements in attracting and retaining foreign financial services companies (largely reinsurance), which underpin high per capita income; its large net external asset position; and the government’s net fiscal asset position, although the latter has declined with growing deficits,” Standard & Poor’s said in a statement. “Constraining the ratings are Bermuda’s lack of monetary flexibility and continued gaps in official data, despite some progress.”

S&P estimated that nominal GDP in Bermuda, although “still much higher than that of most sovereign at $80,000 per capita,” would be 15 percent below its 2008 peak.

“Nevertheless, we expect Bermuda’s economy to stabilize and begin to modestly grow in 2014-2015, particularly if its major trade and finance partner, the U.S., continues to increase its GDP by 2%-3%, in real terms, as we expect,” the firm said. “In addition, the new One Bermuda Alliance governing party is undertaking a variety of measures aimed at economic revitalization.”

The firm said that fiscal revenue had declined in nominal terms, reflecting the island’s weak economy, and that Bermuda’s deficit had gradually risen.

The firm said it expected general government debt in Bermuda to rise by less than 2 percent of GDP over the next three years, after jumping by almost 13 percent of GDP last year.

It said the negative outlook reflected its view of the potential for a downgrade over the next two years “if the island’s economy fails to show signs of emerging from its contraction since 2009, if the new government’s fiscal consolidation plans prove difficult to implement, or if ongoing bank loan deterioration leads to further weakness in the broader banking system.”

Popular Posts the sexiest beaches including this resort at atlantis

The Sexiest Beaches in the Caribbean to Visit Right Now 

One is a beach with a nightclub-style pool right next door. Another is filled with beach bars — and even has its own au natural corner. Then there’s a beach that’s practically a nonstop party.  There are so many things that […]


The Best Caribbean Islands to Visit This Summer, From Antigua to St Croix

verandah antigua

We’ve been saying it for years, and we’ll keep saying it: in some ways, the Caribbean is even better in the summer months. The water is warm. It’s a bit less crowded, a little bit quieter. At night, the trade […]


The Winners of the 2024 Caribbean Green Awards 

caribbean green

With almost 20,000 votes, the winners of the Caribbean Green Awards 2024 Presented by E-Finity have been crowned.  From state-of-the-art marine conservation projects to hotels that are redefining sustainability, the Green movement has never been stronger in the Caribbean.  “This […]


Related Posts dominica fort young

American Airlines Is Adding More Daily Nonstop Flights to Dominica

Fresh off the news that American Airlines would be running daily flights to Dominica for much of the summer, the world’s largest airline has plans to extend that service.  American Airlines already announced that it would be operating daily nonstop […]


Dominican Republic Cruise Tourism Keeps Growing 

celebrity cruises ship docked at port

It’s no secret that the Dominican Republic is the most popular destination in the Caribbean, as measured by air visitors.  But the country’s cruise industry has quietly been seeing rapid growth, too.  Indeed, the Dominican Republic welcomed just under 867,000 […]


Wyndham Opens Dominican Republic All-Inclusive, Plans Second Resort in Punta Cana 

punta cana dominican republic trees with beach

Pristine beaches, lush rainforests and winding rivers; the Dominican Republic’s Samana peninsula is a haven for nature lovers and those in search of a more untouched Caribbean.  Now, the area has a new resort, combining all-inclusive convenience with easy access […]


SUBSCRIBE!

Sign up for Caribbean Journal's free newsletter for a daily dose of beaches, hotels, rum and the best Caribbean travel information on the net.


No. Thank You