Bermuda: Country and Foreign Investment
This page was last updated on 2 August 2019.
The unit of currency is the Bermuda dollar (referred to here as BMD) which is at parity with the US dollar (which is also legal tender.) Under the Exchange Control Act 1972 and the Exchange Control Regulations 1973, certain exchange controls apply to Bermudian citizens and to 'local' companies. No capital or exchange controls apply to non-residents or to the various forms of offshore entity (exempt or permit companies or partnerships); these are free to import and export funds in all currencies. There are no taxes that apply to such transfers, and there is no withholding tax on interest, dividend or royalty payments.
The Bermudan economy has been highly successful, with tourism and international business being the two main sources of revenue. Over 500,000 tourists visit the island annually, mostly from North America. There is a minor industrial sector and agriculture is minimal because of the lack of suitable land for crops. Consequently about 80% of Bermuda's food needs are imported.
The nominal GDP for Bermuda in 2017 was US$4.72 billion; this gives a GDP per capita of $72,126, which is one of the huighest in the world (the purchasing power parity figure is even higher.)
The development of Bermuda's thriving financial sector began in the 1950s. The Government's selective attitude to incoming business, and particularly - until recently - its exclusion of foreign banks, helped to foster the island’s excellent reputation. A wide variety of financial services are represented, with the captive insurance sector being the world leader; fund and trust management are also prominent.
Supervision of the financial sector is in the hands of the Bermuda Monetary Authority, an independent agency which inherited regulatory and supervisory powers from the Government under the Banks and Deposit Companies Act 1999, which was implemented in 2000.
In July 2019, there were more than 18,000 Bermuda-based international companies, 2,551 local companies, 420 overseas partnerships and 840 other non-resident entities.
The Bermuda Stock Exchange (BSX) was opened in 1973. On 1 August 2019, 808 issuers were listed. Of these, 3999 were derivative warrants and 322 were collective investment vehicles listed. The total market capitalization of the BSX in March 2019 stood at US$2.9 billion.