to Hong Kong and Malaysia. Now, after about a year, it is threatening the United States. Asia is a major US trading partner and its imports from the US are slowing. There are clear indications that in this part of the world we may well be in for a severe recession in 1999. Until very recently the United States economy has remained remarkably strong given the problems elsewhere but it is weakening.

Given the political turmoil and uncertainty surrounding the Presidency of the United States, we have doubts that the United States, can or will respond well to the economic threat and that is bad news for Bermuda. No matter what one thinks of Zipper Gate, the executive and legislative branches of the US Government are totally distracted at exactly the wrong time.

For an indication of the looming crisis just take a look at a few of the stories in yesterday's newspaper.

Investors in the United States indicate they are expecting a recession in 1999. They fear a slowdown in consumer spending as overseas financial turmoil erodes profits of the blue chip companies that do business abroad. Retail stocks are a leading indicator of whether the US economy is slowing into recession and they clearly point to severe economic slowdown.

The downturn in the global markets has led to significant losses at two major international investment operations in Bermuda.

The Bermuda Stock Exchange is monitoring the international situation very carefully and international economic problems have the potential to slow down new funds and products listed on Bermuda's stock exchange.

After attending the Commonwealth Finance Minister's meeting in Ottawa, Finance Minister Dr. Grant Gibbons has said that financial watchdogs and "super regulators'' to police banking, finance and insurance are to keep an eye on Bermuda because of the economic depression spreading from Asia.

This is not a reflection on Bermuda but it is designed to prevent economic problems and points out Bermuda's international importance today. There is spreading financial turmoil from Asia and from Russia and Western financial leaders are attempting to stem or to limit its spread.

These problems, over which tiny Bermuda does not and cannot have any control, all indicate the need to protect Bermuda's economy. We weathered the last bad recession very well and we need to be in a position to get through any looming new recession with a minimum of damage.

Bermuda's economy and its high standard of living are not accidents. They require careful management and maintaining them takes planning. Without a strong economy, without money, Bermuda will not be able to pay for the education, social programmes, dreams and aspirations of its people.