Bermuda’s gross domestic product grew by 2.5 per cent after inflation last year, thanks partly to an economic boost from the America’s Cup.

The strongest growth was in the hotel and restaurant sector and the real estate and renting industry, two of the areas of the economy to benefit from the island’s hosting of the international sailing event.

International business saw only slight growth, but in directly representing more than a quarter of the island’s economy, remained the largest sector by far, according to a report released by the Department of Statistics yesterday.

GDP, which measures the value of goods and services produced by Bermuda, totalled $6.27 billion in 2017, up 2.9 per cent from 2016, or 2.5 per cent after adjustments for inflation.

Last year marked a rebound for the economy after a 0.1 per cent decline in real GDP in 2016.

Lovitta Foggo, the government reform minister, said some economic indicators were showing promise for this year too. “The 2018 outlook indicates that the areas of construction and employment are exhibiting positive signs, and that bodes well for our community,” Ms Foggo said in a statement sent with the release.

Value added to the economy by hotels and restaurants rose by 23.5 per cent, or $46.6 million, over 2016.

Hotels’ share of this growth was $24.6 million, while restaurants produced $22 million more.

The report said the growth was primarily driven by increased room and food sales as a result of the America’s Cup.

Visitor numbers reached an all-time high last year.

Value added by the real estate and renting industry rose 2.8 per cent, or $21.9 million.

The international business industry’s value added rose 0.7 per cent or $8.2 million in 2017, and represented 26.1 per cent of total GDP.

The report stated: “Businesses engaged in financial activities and insurance management experienced growth in value added while companies involved with insurance risk-taking activities, including insurance underwriting, insurance brokerage and reinsurance services experienced a decline in value added due mostly to lower performance-based bonuses.”

The island reinsurers were hit with huge catastrophe claims in 2017, related to events including hurricanes Harvey, Irma and Maria, as well as wildfires in California and an earthquake in Mexico City.

The construction industry also had a year of growth, with activity up 1.9 per cent, or $3.4 million, in real terms.

The report states: “This growth was attributed to increased construction activity associated with the 35th America’s Cup event, residential renovation, airport development and hotel development.”

The other community, social and personal services increased 10 per cent or $9.8 million in 2017. This improvement was due to a 14.7 per cent rise in recreational, cultural and sporting activities, related to the America’s Cup. Hairdressing activities and miscellaneous personal services also recorded increases in value added.

Public administration’s contribution to the economy also rose 2.8 per cent, or $6.8 million, due mostly to increased public-sector spending on wages, salaries and employee benefits.

Wholesale, retail trade and repair services recorded an increase in value added of 1.6 per cent, or $4.8 million. Retail, trade and repair services led the way, with growth of 2 per cent, driven by the sale of clothing, food at grocery stores, fuel at service stations and sales at pharmacies. ?Wholesale and commission trade activities also increased by 0.8 per cent.

In terms of dollar value at current prices, international business generated about $1.67 billion of GDP, while real estate and renting activities reached $1 billion for the first time to rank second, while financial intermediation, which includes the banking industry, generated $736.8 million.

• See the PDF of the full report under the heading of Related Media