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The Bermuda Society June 2002 Newsletter - Issue 2 IN THIS ISSUE New Governor The Budget Tourism E-business World Rugby Classic Society Events Masefield Collection of African Artifacts. Part 1 Message from The Chairman children outside the Cabinet Office after being sworn in, said that he would seek carefully to preserve the delicate Welcome to our second Newsletter! As Summer arrives, balance between the powers and duties of the we find ourselves looking at a more cheerful scenario Government and the powers and duties of the Governor. economically in the Western world and Bermuda looks set to participate in this advantage, particularly in the Sir John, 55, was educated at Marlborough College and fields of insurance, banking and e-commerce. The Keele University. He joined the Ministry of Overseas Society's membership continues to grow slowly but Development in 1967. He worked in the World Bank steadily. A meeting with BIBA in London on 16th from 1970 to 1972 and then returned to the Ministry of January has supported a closer working relationship with Overseas Development and served as Private Secretary them. There are clearly many areas of mutual interest to three Ministers of that department. In 1983 he was between BIBA and the Bermuda Society where there can promoted to Under Secretary of State for Asia in what be greater interaction. The programme of events outlined was then the Overseas Development Administration. elsewhere in this Newsletter shows a significant increase Subsequently, on promotion to Deputy Secretary in 1988, on our activities. The recently retired Governor of he joined the Department of Education, becoming Bermuda, Mr Thorold Masefield, has kindly agreed to responsible for higher education, including the join the Committee of Management. With the anticipated establishment of the national student loans scheme. He advent of the Overseas Territories Citizenship Act and was awarded a CB in 1992 and became a KCB in the the right of Bermudians to full United Kingdom, and 1999 Honours List. hence EU passports, we hope to see many more Bermudians in London. It is to be hoped that the We wish His Excellency and Lady Vereker a happy and expanded content of the Newsletter is interesting and fulfilling time in Bermuda. helpful to members. Suggestions about the Newsletter are always most welcome. Budget Commentary By David Ezekiel New Governor Chairman of the Association of Bermuda On the 9th April Sir John Vereker, accompanied by Lady International Companies Vereker, arrived at Kindley to take up the office of Governor and Commander-in-Chief of Bermuda. Sir Finance Minister Cox's 2002-3 Budget met with a mixed John Vereker was Permanent Secretary of the reaction though it was generally favourably received. Department for International Development, and of its The Royal Gazette headline read "Cox's 'sweetheart' predecessor, the Overseas Development Adminis-tration, Budget" and went on to say that it came very close to since 1994. His Excellency, seen here talking to school being an election Budget. PricewaterhouseCoopers raised serious questions about the level of spending and the $75m increase in borrowing and spoke of potentially 'serious damage' to the economy but the Minister dismissed these comments as 'alarmist' and said that PWC's analysis was 'lacking in substance'. The Budget projected $609m in revenues for 2002/3 with current expenditure budgeted at $585m and $109m set aside for capital projects. Business and consumers were spared new taxes and there was an extension for some local businesses of the Payroll Tax Reliefs, introduced after the post-11th September slowdown. Pensions were increased by 3%. Most Government fees were increased by 5%. Seniors did well in the Budget - in addition to the pension increase, seniors with ARV's above $80,000 received Land Tax breaks, there is added financial assistance and hospital subsidies, and a new parish rest home for St. George's. Government has also established an Office for the Aging to address the needs of seniors. The Bermuda Society 2 The $109m Capital Projects Budget comprised $104m In May, Bermuda will host the African Diaspora Heritage for projects already in progress and a further $5m for Trail conference. The trail traces the origins of many new projects, including $1.5m for an upgrade of the Bermudians to their African ancestors and will create Hamilton Bus Terminal. Continuing projects include the links with many Caribbean and African states, as well as Civil Air Terminal ($7m), the Hamilton Police Station & with the United States. Magistrates Court ($11m) and Ferry Docks ($6m). Golf, one of Bermuda's key niche markets with more golf The Opposition was unimpressed by the Budget which it courses per square mile than anywhere else in the world, termed a "gambler's budget" as it relied upon an has also received a boost with the re-opening of Tucker's economic recovery which may not arrive. They also Point Golf Club and the start of the re-development of attacked the increased borrowing of $75m but the Belmont Golf Club. Minister countered that debt was still only 7% of GDP Bermuda Tourism has been supporting these and below the statutory ceiling of $250m. developments by its presence at many events throughout A new initiative announced in the Budget is the Europe such as consumer and trade exhibitions in the introduction of Unemployment Insurance for Bermuda UK, Germany and Italy along with a trade seminar and workers. Government will provide seed funding of $1m gala dinner in Dublin to launch Bermuda Tourism's to fund a study over the next 12 months to determine the presence in Ireland. best way forward and this will include discussions with Later in the year, key tour operator partners from Europe unions and employers. will be invited to the Bermuda Tour Operator Summit where they will have the chance to meet with hoteliers, Bermuda strikes an upbeat note for and those running attractions, restaurants and ground 2002 transportation companies to develop their programmes further. Following on from the Hotel Concessions Act in 2000, and the tax incentives it brought with it, many Bermudian "Following a difficult year in 2001, Bermuda is hoteliers have been carrying out renovations to their recovering very successfully with a 38% rise in European properties. These include both the Fairmont visitors for January to March," said Ian Parker, Director Southampton and Hamilton Princess properties, which of Tourism, UK & Europe. "Whilst we do not envisage both added a floor of luxury Entrée Gold rooms, and the sustaining this rate of increase indefinitely throughout former also added the largest spa off the East Coast of the 2002, the many developments in Bermuda, along with USA, at a cost of $18m, which opened in April. our activities around Europe, are building a solid Cambridge Beaches, the luxury cottage colony at the foundation for further increases over the coming year." western end of the island, has added a number of suites in addition to an extensive overhaul. Ariel Sands, the E-business survey: how Bermuda is cottage colony belonging to Michael Douglas' family, catching the E-business wave has also recently completed an extensive refurbishment of all of its rooms and its spa facilities, along with major The Hon. M.D. Renee Webb, DHumL, JP, MP, landscaping. Minister for Telecommunications and E- Commerce. In addition, it is proposed that the Lantana Hotel will re- E-Business, whether we like it or not, is changing the open as a "Wellness" Resort. The Tucker's Point Resort, way we both work and live. Many of us in Bermuda the 104 suite hotel managed by Rosewood Hotels and could now not envisage a world without e-mail or access being built on the site of the old Marriott Castle Harbour, to the Internet; how would we contact friends and family is on course to open in 2004 and there are also plans for abroad or book our holidays? And yet it has only been a an 80 suite hotel in Hamilton. few years since we first started using these technologies! Who would have guessed 5 years ago that 67% of Many special events are held in Bermuda throughout the Bermudian households or 95% of businesses would have year with established ones such as the Festival of the connections to the Internet? Performing Arts in February, the International Film Festival in April, the Jazz Festival in September and the And yet despite these plain facts there are still concerns World Rugby Classic in November. Newer events about the true impact of the Internet and, in particular, its include the Big Game Classic in July and, for the first real take-up in the traditional business community. I thus time, in 2002, the Festival of Culinary Arts in November. hope the following will show that for Bermuda, at least, the e-business message has truly spread. The Bermuda Society 3 Some Background significantly progressing in adopting e-business techniques over the next 2-3 years. We have businesses The idea of an E-Business Survey emanated from the expecting an increasing part of their income through e- development of the National Plan on E-Business that the business, businesses already noticing how e-business can Ministry, which I have the privilege to lead, has been enable them to better serve their customers and also tasked with producing. The Plan will look not only at create internal efficiencies. We also, however, have attracting e-business to Bermuda but also at using e- businesses that are challenged by the requirements for e- business locally to increase the efficiency of both business and businesses that do not know where to turn business and Government as well as benefiting citizens.