The fall-out from the terrorist attacks on the United States on September 11 have brought both ill wind and fortune to Bermuda, with tourism hit hard by a lack of travellers, and international business' booming insurance sector.

Minister of Finance Eugene Cox mentioned the attack 14 times in his Budget Speech, illustrating how pivotal the event has been for Bermuda's economy.

"We have set out a Budget to provide a cushion to ease the economic challenges that were triggered by the cataclysmic events of the attack on America on September 11, 2001," he said in his opening remarks. "It is now generally accepted that September 11 was a pivotal point in the global economy and in the history of the world."

And he said that the aftermath of that "dark day in history" had dramatically impacted the world economy and changed the way the countries interact with each other.

Mr. Cox added: "The most ominous index for the travel and tourism industry, a principal pillar of our own country's economy, was the virtually global drop in consumer confidence following the events of last September."

And he said that the challenge in the Budget was to make sure that Bermuda avoids any lasting set-backs from the economic impact of the attacks.

"The picture for Bermuda is both positive and negative. On the one hand our tourism sector has been dealt a severe blow," he said. "Persons with low or fixed incomes are finding it more difficult to make ends meet and unemployment is estimated to have risen.

"On the other hand the insurance industry and related financial services are showing increased growth."

And he warned that the year ahead would be extremely challenging because of a number of economic factors. And he said that the Budget would help those businesses hardest hit by the recession and strengthen social cohesion in the community.

He added: "In the wake of September 11, there has been heightened interest in Bermuda as an insurance and reinsurance domicile. During the last few months eight major insurance and reinsurance companies have been incorporated and more than $10 billion new capital has been injected into Bermuda's market.

"It is expected that this development will spur the creation of new jobs as well as create demand for additional office space and residential accommodation and give a boost to consumer spending."