Prevailing mood: proof of Bermuda’s stability and success
In the coming two to three years, Moody’s expects fiscal performance will be supported by the recovery in economic activities. Moody’s expects growth performance to regain momentum compared to previous years, supporting a gradual downward trajectory in government debt.
“The tourism sector and investments in new hotels on the island are important drivers for improved growth prospects” (Moody's press release, June 21, 2022)
In May 2022, ratings agency Standard & Poor's reaffirmed Bermuda's A+ sovereign credit rating, A-1 short-term rating, and AA+ transfer and convertibility assessment, and now there is more good news as Moody’s Investor Service affirmed Bermuda’s A2 issuer and senior unsecured bond ratings and maintained Bermuda’s stable outlook.
This latest positive rating is yet another independent, unbiased, professional assessment of Bermuda’s economic strategy. It is a validation of our correct and prudent decisions made when managing the island’s economy. Our hard work and strategic planning are gaining traction as the Government steadily rebuilds the economy post-pandemic.
It is no small feat that the favourable ratings have been achieved, although the Government was required to raise the debt ceiling to borrow $200 million because of the guarantee on the One Bermuda Alliance administration’s failed Morgan’s Point project and an additional $44 million that taxpayers have had to pay to Skyport.
There is no doubt that we are making progress. But until we reach the point of full recovery, your government will continue to help vulnerable people throughout the island with targeted financial assistance, educational and training programmes, and tax breaks.
We will continue implementing Bermuda’s Economic Recovery Plan, which received praise from Moody’s in its June 21 press release. The ratings agency stated: “Bermuda is a global centre for insurance and reinsurance industry, and the sector remains attractive to new businesses. Over the medium term, Bermuda will be in a position to take advantage of new opportunities in insurance and reinsurance sectors, such as cyber and climate risk underwriting, which Moody’s expects will expand in the coming years, signalling the potential for strong growth in this emerging sector in Bermuda.”
Moody’s also gives country ratings for environmental, social and governance, and we are proud to report that Bermuda received the highest possible score for governance. The report highlights the Government’s fiscal and economic policies as essential in maintaining Bermuda’s resilience during exceedingly difficult times globally.
Bermuda’s economy is moving in the right direction, as per the professional analysis from global financial agencies that clearly show the island’s outlook is stable and poised for growth.
• Zane DeSilva is a government backbencher and the MP for Southampton East (Constituency 29)