Next year will paint a different picture when it comes to construction, Finance Minister Bob Richards said after revealing industry spend was down almost 19 per cent on the first quarter of last year.

Mr Richards yesterday released the first quarter 2015 GDP report, which revealed that while gross domestic product was up 2.2 per cent, construction took a big hit.

There has been much talk around hotel development in the past year, including developments at Ariel Sands, Morgan’s Point, Pink Beach and the St George’s Hotel, but Mr Richards said with the exception of Pink Beach, the construction phase is not yet here.

He told The Royal Gazette: “Most of the big projects really haven’t gotten going yet. Nothing much has happened at Ariel Sands and nothing significant has happened at Morgan’s Point — most of the work at Morgan’s Point has been the Government expenditure cleaning up the pollution there. Pink Beach, there is certainly construction going on there.

“The bigger the project the longer the lead time. I am told that there is anecdotal evidence from real estate agents saying there are rennovations projects residentially.

“But the ones that are going to move the national needle still haven’t got revved up. People are going to be sceptical until they see it happen — I appreciate people who are sceptical and my only advice to them is say something nice when it does happen.

“Things will have started to happen by next year. I am pretty confident that we will see a number of things taking place a year from now in terms of construction.”

Mr Richards hailed the growth in gross domestic product as “good news”.

Mr Richards announced yesterday morning that the GDP at current prices grew by 3.7 per cent compared with the first quarter of last year estimated at $1,651.4 million

When adjusted for inflation that was a rise of 2.2 per cent.

He said it was “clearly indicative of the fact that the economy is growing and the latest evidence of an improved economic outlook.

“Our efforts to stimulate investor interest in Bermuda are continuing to bear fruit, providing increased prospects for the future.”

The main driver for the increase was said to be a boost in trade in goods and services which offset declines in construction — down by 18.8 per cent (constant price) from $63.5 million to $51.6 million. This dip in construction spend was a big contributor to the real-term drop in gross capital formation — net acquisitions of fixed assets — to 5.6 per cent. Spending on household consumption — expenditure incurred by resident households on individual consumption goods and services — was up by 0.9 per cent with most spending on “durable goods” such as cars, air fares and catering yet when adjusted to inflation the figure was actually down 0.2 per cent.

While Government consumption rose by $1.9 million, taking into account inflation that figure represented a 0.5 per cent drop.

The net surplus on trade in goods and services rose 13.4 per cent reflecting a 5.9 per cent rise in the export in services including travel and insurance though there was a decline in the imports of goods especially fuel.

Mr Richards said that while the figures were positive, Bermuda’s economy faced a long road ahead.

He said: “The Government remains focused on creating the investment environment that will bring long-term job opportunities for all Bermudians across the employment spectrum.

“Let us not forget that before there is a new job you must have an employer, and before there is an employer there must be investment. That’s why we are focused on increasing investment in our Island.

“And we remain joined to the battle of gaining control of runaway spending without harsh and draconian austerity measures that would bring more hardship to the community.

“Boosting public revenues and controlling public spending will lead us to a more balanced approach of living within our means.

“And ultimately that will provide the environment needed to begin whittling away at the country’s debt.”