REMARKS OF U.S. CONSUL GENERAL GREGORY W. SLAYTON
to the International Reinsurance Summit
May 21, 2008
Harborview Room, Hamilton Princess

• Good morning and welcome all to the International Reinsurance Summit.  And thank you for inviting me to speak to you today. I am honored to be here.
• Today I’ll be talking about United States/Bermuda Bilateral Relations in 2009 and Beyond.
  

Current Bilateral Relations.

• I think it is safe to say that the relationship between the United States and Bermuda is at or near an all-time high, marked by mutual respect and cooperation on a wide variety of fronts. We have developed a good rapport at or near the highest levels and, as a result, we enjoy a healthy, open dialogue.
  o   Shared values and culture.
  o   Up to 500,000 US tourists to Bermuda. In fact, Bermuda is one of the top ten destinations visited by Americans.
  o   Over 250 billion in US capital in Bermuda.
  
• Instead of the ennui that characterized some of the discussions even just 4-5 years ago, our governments regularly discuss issues and concerns of common interest. 
  o   Access to the U.S. – stop list and waivers.
  o   Anti-money laundering improvements.
  o   Voluntary Visitor Program – youth development, healthy children and families and, in 2008, education.
  o   Facilitating information exchanges between international companies and the government on education, financial and other matters.
  o   Training Bermudians in US Patent and Trademark programs.
  
• It is important that we act as neighbors and friends, not least because our economic relationship is mutually advantageous.  Bermuda relies on the U.S. for -

       o   Imports (80%)
       o   Tourists (80%)
       o   Medical care.
       o   Education.

• And  this important partnership is very much a two-way street.  Bermuda’s thriving international insurance industry was very much there for us in the aftermath of recent devastating hurricanes and the terrorist attacks of 9/11.
• Bermuda-based insurers and reinsurers paid nearly 26% of the insured losses arising from the devastation caused by hurricanes Dennis, Katrina, Rita and Wilma. This is not the first time Bermuda’s insurers and reinsurers have contributed substantial funds to US reconstruction. 
• After 9/11, Bermuda-based insurers and reinsurers paid over $2 billion in total insured losses. In the years since they have poured more than $20 billion for catastrophic loss payments into the reconstruction of the US economy.
  

But, as always, there are challenges that we must confront together.

CONTINUE TO STRENGTHEN ITS ANTI-MONEY LAUNDERING LAWS.

• To safeguard the goose that laid Bermuda’s golden egg, it is in the island’s best interest to model the highest global financial standards. 
• Though Bermuda has already established an anti-money laundering (AML) regime, there is definitely still room for improvement.  The International Monetary Fund, for example, pinpointed weaknesses in funding and staffing levels to properly enforce existing regulations. 
• We do not agree with the recent comments of UK Parliamentarian Edward Leigh who labeled Bermuda’s anti-money laundering effort “appalling.”  However, there is room for improvement at the legislative and prosecutorial levels. This is normal for all countries. It’s called “growth.”
• In the Throne Speech, Premier Brown committed to addressing these concerns as a priority and to upgrade relevant legislation as soon as possible.
• We are very pleased and supportive to hear of that commitment, as demonstrated by the recent attendance of a Bermuda delegation at the Caribbean Financial Action Task Force meeting.  The delegation presented a progress report on Bermuda’s plans to strengthen not only anti-money laundering legislation but also legislation to combat terrorist financing.  The AML team is working diligently to address the recommendations made by the International Monetary Fund pursuant to the IMF’s May 2007 assessment.
• Further, the government distributed a consultative package to key stakeholders on May 1, 2008, to solicit views on the changes that are being proposed to enhance the effectiveness of the anti-money laundering/combating the financing of terrorism regime.  I understand that the deadline for comments is June 10, and I urge all those with a stake in making Bermuda’s legislative framework consistent with global standards to make their voices heard.
• This is all to the good, as Bermuda seeks to attract new re/insurance business from the Asia Pacific and Mid East markets as well as hedge fund business away from the Caribbean.

EFFECT EDUCATION REFORM TO ENSURE COMMUNITY STABILITY AND PROSPERITY

• A recent study by Jane’s Information Group on the various factors that establish a country’s stability ranked Bermuda 52^nd out of 235 countries surveyed, including the rival Cayman Islands (44^th), British Virgin Islands (46^th) and St. Lucia (48^th).  Education is one of the factors surveyed given the pivotal role it plays in preparing young people to assume leadership roles and to become all-round good citizens.
• We all recognize that Bermuda’s public education system is in urgent need of upgrading. In fact, UK Overseas Territories Minister Meg Munn was recently quoted as saying that it is clearly important for Bermuda to improve education.
• I commend Premier Brown and Education Minister Randy Horton for acknowledging the truth openly and taking action to correct it. That takes courage and commitment because change is difficult.  
• In our own small way, the American Consulate has a role to play in upgrading public education.  This fall the Consulate will send its 4^th Voluntary Visitor team of Bermudians to the United States. Their goal this year will be to study top education programs, with a view to adopting policies and programs that have application to Bermuda.   This effort will complement the rigorous campaign already underway in Bermuda’s education system and dovetail the March field trip to New England vocational schools led by Minister Horton.
• Locally, Bank of Bermuda CEO Phillip Butterfield and I have co-hosted several meetings with corporate leaders to gain their input about how public education in Bermuda could be improved.  The unassailable outcome was that the international business community is 100% behind improved education. It is in their best interests, after all, to reduce costs. It makes economic sense to hire locally.
• But corporate support is not enough. Government cannot do it alone, nor can teachers or parents. What is needed is a partnership of all these elements, with our children in the middle.  The mindset must be one of educational excellence, which generates opportunity in the workplace and social cohesion.
• I believe the will is there, and trust that together we can make it happen.

US/Bermuda Relations under a New American Administration.

• Communication, no matter what the topic, is critical in any relationship, which is why I have committed to arranging a third annual “state visit” for the Premier and Deputy Premier to meet with their counterparts and other leaders in Washington.
• The past two consecutive Washington visits with influential legislators and top-level executives – with enthusiastic support from the Premier and Deputy Premier – will stand Bermuda in good stead for the future, whichever party wins.  For example, we met with:

• Premier and Deputy Premier have themselves worked hard to establish strong, productive relationships with leaders such as Charlie Rangel, Diane Watson and others.
• So I think a good foundation has already been laid that augers well for futu re bilateral relations. Add these visits to the Bermuda government’s representation in Washington, and Bermuda is well placed whether the Democrats or the Republicans win the White House. 
• With a Republican win, Senator John McCain’s visit to Bermuda in 2007 – when he met with the premier – will provide firm groundwork upon which to build closer ties. The Senator has a long and happy history with the island since the days when he was a naval aviator.
• If the Democrats are successful, I feel equally sure that future VIP visits to Washington will continue to provide the opportunity for Bermuda to get its message across.

Thank you for your time/attention and the opportunity to speak to you today.