Bermuda's economy will be severely affected by Barack Obama's election as US President if the new administration decides to target Bermuda as a tax haven, according to the island’s Royal Gazette newspaper.

Phil Barnett, president of Bermuda’s Chamber of Commerce, congratulated President-elect Obama on his win, but warned that Bermuda’s government must act quickly to put the island's case for not being a tax haven and the important role international business domiciled in the country plays in the growth of the

US economy.

Mr Barnett also called on government to suspend term limits to ensure the future of overseas companies based in
Bermuda.

Bermuda has become an important financial centre for sectors including hedge funds and insurance. Along with other international financial centres, Bermuda is under pressure from governments in the

US and elsewhere that are keen to prevent leakage of tax revenues.

Despite Mr Obama not making direct reference to Bermuda, the island was on a list of jurisdictions taken from Internal Revenue Service court filings identified as "probable locations for

US tax evasion" under the "Stop Tax Haven Abuse Act" introduced by Senator Obama, Democratic Senator Carl Levin and Republican Senator Norman Coleman last year.

"However we would be fooling ourselves as a country if we don't realise that should the Obama presidency choose not to listen to Bermuda's case to not target it as a supposed 'tax haven', then every Bermudian, in every job, no matter what their financial status is, will be severely impacted," Mr Barnett said.