Minister the Hon. David Saul said yesterday.

And the process would probably last well into next year, he said.

His warning came at the end of a long speech to Hamilton Rotarians which trumpeted Government's economic management through three years of hard times.

"There is clear evidence that Bermuda is gradually emerging from the recession,'' he said.

But he added: "I have said repeatedly that recovery from recession will be slow and at times erratic, a process that will probably stretch well into 1994.

"For the record, a recession is not something that can be turned off like a light switch.

"You slide into recession and you come out slowly. Do not pay attention to anyone who says the recession is over or not over, or that the Minister of Finance said it's over and the light switch is back on.'' Dr. Saul's comments seemed to contrast with his last major speech on the subject, in June.

He said then: "I think we can safely say that at the moment, the recession is over, but unemployment is not.'' Yesterday Dr. Saul pointed to figures he said showed the Island emerging from recession.

Visitor arrivals so far this year, up nearly 11 percent on last year, were "strongly positive''. But the increase was on "dismal'' 1992, he admitted.

Retail sales had been positive from April to July, although there was some concern about August, for which reliable figures were not available.

International business had been a "bright spot'' during the recession, and new incorporations were up 10 percent so far this year.

The strength of the recovery would depend heavily on the strength of the US recovery, he said.

"Just as the recession in that country, our dominant trading partner, drew Bermuda inextricably into recession, so we have to look to the continuing strengthening of the US economy and a growth in confidence of the US people to sustain Bermuda's present recovery.

"Neither is by any means assured. As the Premier said recently, it is not impossible that the US economy will slip backwards. Heaven forbid that such a tragic thing should happen.'' Closure of the Canadian base and possible cutbacks in US personnel -- if not a withdrawal -- could have "major financial implications''.

The bases contributed $40-50 million a year to the economy, he said.

Dr. Saul said Government measures that helped the Island through recession included tax breaks for hotel refurbishment, tightened controls on work permits, special works projects and programmes for social and housing assistance.

Jobs had also been created by big works like the incinerator and the new prison.

Unemployment had been kept to "manageable levels'' and control of inflation had softened the recession's impact.

"Despite the admitted hardships that the Island has had to endure over the past three years, there is no doubting the fact that when compared with most other countries, Bermuda has weathered this recession remarkably well.

"Our survival was not an accident -- it was the result of a great deal of sacrifice, planning and hard work by everyone.'' Dr. Saul said it was a "remarkable feat'' that Government had produced a modest current account balance during the recession.

Government was able to limit borrowing to the financing of major projects like prisons, the incinerator and schools.

"This result makes us the envy of many. When I meet my opposite numbers at the Commonwealth finance ministers meeting next week, some will find our record difficult to believe.

"I can guarantee that not one of them will make the allegation that Bermuda is bankrupt. All of them know how to read a financial statement and would never make, on the evidence, such a ludicrous comment.'' This was an apparent reference to a charge from Opposition leader Mr.

Frederick Wade that a PLP government would inherit a "bankrupt'' Country.

Dr. Saul said Bermuda's avoidance of income tax was envied by most countries.

Although the Island's tax system was "very appropriate'', Government kept it under study and a Canadian consultant had come in to do a full review.