The
United Kingdom is formally responsible for Bermuda’s foreign
and defense policy. U.S. policy toward the U.K. is the basis of
U.S.-Bermudian relations. In the early 20th century, as modern
transportation and communication systems developed, Bermuda became
a popular destination for wealthy U.S., British, and Canadian
tourists. While the tariff enacted in 1930 by the U.S. against
its trading partners ended Bermuda's once-thriving agricultural
export trade--primarily fresh vegetables to the U.S.--it helped
spur the overseas territory to develop its tourist industry, which
is second only to international business in terms of economic
importance to the island.
During World War II, Bermuda became a significant U.S. military
site because of its location in the Atlantic Ocean. In 1941,
the U.S. signed a lend-lease agreement with the U.K. giving
the British surplus U.S. Navy destroyers in exchange for 99-year
lease rights to establish naval and air bases in Bermuda. The
bases consisted of 5.8 square kilometers (2.25 sq. mi.) of land
largely reclaimed from the sea. The U.S. Naval Air Station was
on St. David's Island, while the U.S. Naval Air Station Annex
was at the western end of the island in the Great Sound.
Both bases were closed in September 1995 (as were British and
Canadian bases), and the lands were formally returned to the
Government of Bermuda in 2002.
The Government of Bermuda has begun to pursue some international initiatives independent of the U.K. in recent years. Bermuda signed a cultural memorandum of understanding with Cuba in 2003. The island also joined the Caribbean Community (CARICOM) as an associate member in 2003. The U.S. Coast Guard (USCG) provided search and rescue assistance immediately following Hurricane Fabian in September 2003 but Bermuda declined subsequent offers of reconstruction assistance from the U.S. and U.K., preferring to accept assistance from its Caribbean neighbors. The USCG continues to provide search and rescue assistance as needed.
An estimated 8,500 U.S. citizens live in Bermuda, many of them employed in the international business community. There also are a large number of American businesses incorporated in Bermuda, although no actual figures are available. Despite the trend of American businesses moving to Bermuda or other offshore jurisdictions to escape U.S. taxes, Bermuda maintains that the island is not a "tax haven" and that it taxes both local and foreign businesses equally.
While U.S. visitors to Bermuda are critical to the island's tourism industry, the number of U.S. visitors to Bermuda is declining. In 2006 only 76% of air arrivals originated from the U.S. compared to 83.9% in 1990. The number of air and cruise passengers from the U.S. totaled 464,000 in 2000. That number fell to 451,924 American passengers in 2006. Another 3,861 Americans sailed to the island via private yacht in 2006.
In 2005, 74% of Bermuda's imports came from the U.S. Areas of opportunity for U.S. investment are principally in the re-insurance and financial services industries, although the former U.S. base lands also may present long-term investment opportunities.
Principal U.S. Officials
Consul General--Gregory W. Slayton
Deputy Principal Officer--Matthew Johnson
Consul--Margaret Pride
The U.S. Consulate General is located at "Crown Hill," 16 Middle Road, Devonshire, just outside the City of Hamilton; tel: 441-295-1342; fax: 441-295-1592; web site: http://hamilton.usconsulate.gov/.
