A Financial Times survey of Bermuda, published last week, focuses world attention on a number of local issues, including declining tourism, the base lands, the McDonald's fast food controversy and the messy legal dispute over the insolvent Bermuda-domiciled insurer EMLICO.

But the six page survey talks of an "economic stability and political maturity that Bermuda has been developing'' and "the world's third largest insurance market, after London and New York.'' It largely credits a rapid growth in international business for creating a society "whose gross domestic product per person has reached an impressive $30,000.'' The primary article states that the next election may well be the first since 1968 that the UBP loses -- although it said the possibility seemed to cause few concerns "among members of the wealthy establishment that has held the reins of political power.'' The article adds: "The opposition PLP, shorn of its more strident tendencies, has become a more centrist party that is no longer seen as the threat that it once was.'' It continues: "However, the Island has yet to deal with unresolved economic and social issues which have, if anything, been thrown into sharper relief by these successes.

"The economic imbalances stem, in part, from Bermuda's dependence on insurance -- a traditionally cyclical business.'' Writers Richard Waters and Canute James tell of a diverse insurance market with $37 billion in reserves, and a Bermuda which ironically no longer boasts of its ability to attract insurance capital.

"Excess capital,'' they declare, "is a curse in an industry with such low barriers to entry: it is often followed by falling profits, a willingness to take on greater risk at lower cost -- and, eventually, damaging losses.

"Bermuda's challenge will be to prove that the brains of its insurance companies, rather than their financial muscle, are the real source of their strength.'' The article goes on: "The job of turning the Island into a more diversified financial centre, reducing its dependence on insurance, is now underway -- with mixed results.'' Headlined "Paradise Island broadens its Horizons'', the feature discusses the arrival of hedge funds and other investment management businesses.

It said that attempts to foster an active securities industry have failed to take root.

Other subjects touched on include education, drugs, the challenge to re-build tourism and the problem of socio-economic divisions.

The article asserts: "international finance, tourism and high-tech manufacturing are all now the subject of intense international competition, and Bermuda's high cost base puts it at a disadvantage.

The FT survey profiles Bermuda's two female political leaders, Mid Ocean Re president and CEO, Michael Butt, the Bermuda Commodities Exchange, the Bermuda Biological Station and the corporate changes at the Bank of Butterfield.

BUSINESS BUC