unrecognisably reformatted. But he had powerful allies in the U.S. and the support of British Prime Minister Margaret Thatcher. In the end, he was successful. Bermuda’s tax treaty came into effect in July 1986, not much more than six months after Barbados’s. It was an event that had profound implications for Bermuda’s fortunes. In 1998 the newly elected
and Bermuda did not require British financial aid. Great Britain thought favourably of Bermuda, and introduced the Bermuda Constitution Order in 1968 judging that Bermuda would find it easy to demonstrate its ability to run its own affairs, and that of all the colonies, would be among the first to move towards complete independence.
Not only did the Bermuda Government make no overt move in the direction of independence after 1968, the population also voted against the idea in a referendum on the subject in 1995 by the then- Premier Sir John Swan. At around the time the Constitution was signed, Britain made it clear that while they had formally kept the conduct of Bermuda’s foreign affairs to themselves, they pledged the fullest possible consultation to keep the Bermuda Government abreast of its activities in that sphere, and to exercise a special
regard for Bermuda’s interests. They also gave Bermuda latitude to negotiate with other countries on its own behalf, although only in relation to things like trade, technical assistance, immigration and the like, and only if Bermuda agreed to allow Britain the final word.
In the early 1980s, Bermuda’s young insurance industry was facing serious challenges. Barbados and the U.S. had agreed a tax treaty at the end of 1984, which was ratified by the U.S. Senate at the end of 1985 and came into force early in 1986. Bermuda’s then Premier, Sir John Swan, realized that if something wasn’t done, the country’s insurance industry would end up in Barbados. Sir John believed that despite Bermuda’s relationship with Great Britain, the U.S. was by far Bermuda’s most important trading partner and ally. He made it his business to cultivate links with American politicians, on a grander scale than his predecessors had done.
Opposite: A Bermudian bank building in Hamilton; Above: A Bermudian home in St George’s Town.
With the backing of the local insurance industry, he used his American contacts to secure an interview in the White House with then-President Ronald Reagan. He took with him a copy of a letter George Washington had sent to friends in Bermuda, asking for gunpowder to help him with his War of Independence, and promising to return the favour if they were able to help. Sir John Swan was, in effect, asking President Reagan to honour General Washington’s promise – something any American President would find hard to refuse. Sir John’s campaign wasn’t
easy. It went on for many months, and involved many U.S. politicians and officials. It didn’t simply push at the boundaries of the envelope in which the British Government wanted to confine Bermuda’s foreign adventures, it left it
Progressive Labour Party (PLP) government expressed reservations about U.S. policies, both domestic and international. The party indicated that Bermuda should turn away from its traditional partners, the U.S., Canada and the U.K., and increase its ties with the Caribbean. Many Bermudian families came here from Caribbean countries, and many others have ties of one sort or another with people from that area. Bermuda sought, and was granted, associate membership in CARICOM, the Caribbean trade association. The PLP Government also signed a cultural agreement with Cuba, despite extensive local opposition and a series of bluntly disapproving comments from the then-U.S. Consul-General. However, the flirtation with Cuba did not last. The Government has now repaired its slightly frayed relations with the U.S., and seems to have come to the understanding that Bermuda’s interests are best served by a continuation of its traditional relationships. The current global economic turmoil has once again caused Bermuda to focus on its relations with its giant neighbour, particularly with the looming possibility of protectionist U.S. legislation that would harm Bermuda’s insurance/reinsurance industry. As an island totally reliant on trade with other countries for its economic well being, international relations will always be of primary concern to Bermuda, irrespective of its constitutional status.
The Parliamentarian | 2009: Issue One - Bermuda | 33