Bermuda’s balance of payment surplus jumped an astonishing $347 million last year to reach $901m, with big rises in income from travel, business services investment income and employee salaries more than offsetting a near doubling of the deficit in the Island’s transportation services sector.

Even though Bermuda imports goods and services to the tune of $2,482m, it ends up with the near billion-dollar current account surplus because of the $3,382m of goods and services it trades back to the rest of the world.

For comparison the Island’s largest trading partner the US has not enjoyed a surplus since 1991 and recorded a deficit of $856.7 billion last year.

Bermuda’s surplus in 2004 was $403m, in 2005 it was $554m, but last year it shot up to $901m.

The biggest driver for the surplus was the exporting of labour and services to the international business sector, where receipts jumped to $3,382m from the $2,666m recorded in 2005.

On the negative side of the equation the dependence on imported goods and services amounted to $2,482m, a year-on-year increase of $370m, creating the final surplus of $901m (the extra million apparently coming through ‘rounding’ up).

The yearly picture was completed after the fourth-quarter figures for 2006 were released by the Department of Statistics, showing Bermuda made a current account surplus of $194m with the rest of the world during the final three months of the year, an $87m improvement over the same period in 2005.

The goods trade deficit for the whole of 2006 went up $133m to $1,068m, the value of goods imported was $1,094m compared to goods exported from Bermuda which were almost half the 2005 total, at only $26m.

The increasing demand for local businesses to service the needs of international business on the Island was evident in the $129m jump in the domestic services sector to $563m.

Business services accounted for $557m to the current account surplus, with $846m in receipts for services to non-residents and a decline in payments for overseas services ($288m).

Increased visitor numbers in 2006 helped the travel services portion of the balance of payments to a $41m boost to bring in a surplus of $231m. Local businesses sold goods and services valued at $508m. Bermudians also spent more overseas, rising $38m to $277m compared with 2005.

There was an almost doubling of the cost of transportation services in the economy with the 2005 deficit of $140m jumping to $270m. Government services that were recorded as a deficit of $23m in 2005 ended up as a $44m surplus in 2006.

Looking at the quarterly figures, during the final three months of 2006 the goods trade deficit went up $34m compared to the 2005 period to $266m. That was also a $17m jump from the third quarter of 2006.

Imports to the Island far out-weighted exports with $271m worth of imports coming in between October and December compared with only $5m of exports. The value of Bermuda exports was down $2m on the previous quarter and down $6m year-on-year.

Wages, salaries, investment income and other employee benefits paid to residents working in the international business sector formed a strong component of the positive current account. Total receipts from non-residents grew $171m to $814m.

There was a $27m surplus in travel services, up $7m from the same period in 2005, with tourists to the Island spending $27m more in Bermuda than Bermudians spent during overseas trips.

Transportation services presented a $75m deficit for the quarter, which was $10m higher than the previous quarter, but business services gave a $45m surplus increase to $143m compared to the last quarter of 2005.

Surplus soars to $901m