had emerged from recession.

They said jobless people and cash-strapped businesses would draw little comfort from the boast.

And they suspected Government could be putting a pre-election gloss on the economy.

"I think Government Ministers ought to be careful about being false prophets,'' stated PLP leader Mr. Frederick Wade.

Chamber of Commerce chairman Mr. Louis Mowbray, a Bank of Bermuda executive, also voiced caution.

"The economy is not something you flick on and off like a switch. It is quite obvious there are still some difficulties.'' He added: "I think we are climbing out of recession, but are not out yet.'' But Sir David Gibbons, chairman of the Bank of Butterfield, shared Government's optimism.

Shops and banks were enjoying a major upswing as tourist numbers picked up.

"There has been a significant improvement. There is no doubt about it,'' he said.

Political and business leaders were reacting to Finance Minister the Hon.

David Saul's latest statement on the economy.

Dr. Saul announced the recession was over for Bermuda.

Key indicators pointed to an improvement -- tourist numbers, predicted visitor spending this quarter, and hotel occupancy levels.

International business and retail sales were also showing encouraging signs.

Dr. Saul admitted, however, unemployment remained a blackspot, and the construction industry needed stimulating.

Yesterday a Finance Ministry spokesman backed Dr. Saul's stance.

"Most economists declare an end to the recession once there have been two quarters of sustained growth.

"Given this definition the Minister can quite fairly make his announcement.'' The spokesman said May's tourism figures were the best since 1987.

He added Dr. Saul would be making an announcement on the economy in the House of Assembly on Friday.

Mr. Wade, however, struck a different line.

"I would be cautiously optimistic about making any final pronouncement about the end of the recession.

"Particularly when one of the main indicators, the employment figures, are very muddy and down.'' Mr. Wade said it was wrong to conclude too much from May's tourism figures.

May was traditionally a good month. It was better look at figures for the whole summer, he said.

"It is when we get to July and August that we can see how we are faring against European competition.'' Mr. Wade stressed businesses were suffering the effects of recession. "I think Government Ministers ought to be careful about being false prophets.'' Dr. Saul's company, Fidelity International, was laying people off, he added.

"Once employment figures are back to normal we can begin to talk about the recession being over. It is dangerous otherwise.'' Shadow Finance Minister Mr. Eugene Cox warned Government against complacency.

And he suggested a "reality check'' before any decrees by Cabinet order that the recession was over.

"I understand that the number of new applicants for social assistance is levelling off.

"That is heartening. However a PLP Government would caution against those sweeping statements that the recession is over, particularly when judged against a backdrop of unemployment and economic lows in certain sectors of the economy.'' Mr. Cox said Government may be taken to task by people in St. George's, Dockyard Housing residents, and traders.

"While we may be on the road to recovery, not much is gained at this stage in being overly optimistic about our true position.

"Unless, of course, it is an election massage designed to lull prospective voters into a false sense of security.'' Mr. Cox said the PLP had predicted an upswing in tourism, and based its Budget Reply on that.

The PLP's Budget predictions were based on more realistic and favourable figures than those used by Government.

"This, despite the PLP not having had access to the statistical information available to the UBP.'' National Liberal Party leader Mr. Gilbert Darrell said Dr. Saul's statement would mean little to many people.

It may be technically correct to say the recession was over -- but that was no comfort to the jobless, or businesses facing the wall.

Mr. Darrell also forecast difficulties in keeping the lid on inflation.

"How is Dr. Saul going to contain it when suppliers to Bermuda are putting prices up?'' Said Mr. Mowbray: "I think we are climbing out of recession, but are not out yet.

"I think to say the recession is over is a bit of an overstatement.'' Mr. Mowbray said a lot of people were still out of work, and a number of businesses in poor financial health.

"There are signs of improvement, but the improvement has to be sustained over the next few months.

"I am definitely more cautious than Dr. Saul.'' Mr. Mowbray said 89,496 visitors came to Bermuda in the first four months of this year.

This was about 7,000 more than last year, and compared to 89,448 in 1991, Mr.

Mowbray added.

But it contrasted with 111,684 for the same period in 1990.

"It shows we have still quite a long way to go,'' said Mr. Mowbray.

Sir David Gibbons, however, said Bermuda had made giant strides towards recovery from April.

"There has been a significant improvement in retail sales, and the banks have obviously benefited.'' Sir David said the revival mirrored an increase in tourist arrivals.

And with the international sector continuing to perform well it bode even better for Bermuda.

Sir David added although not up to date with the construction industry, he believed there had been a modest pick up.

"There is no question things have improved.'' Sir David said Bermuda's revival had happened despite the political stumbling of US President Bill Clinton.

He said Clinton had tried to be "all things to all men'' instead of training his focus on a few issues.

Sir David said Clinton could do better than take a leaf out of former President Reagan's book.

"Reagan may not have been an intellectual giant, but he concentrated on three things in particular.

"Reagan focused on the evil empire, then the Soviet Union, the deregulation of airlines, and the revamping of the tax code.''