Bahamas: Pre-COVID ‘Comeback’ Still $3Bn Off GDP Target

• The Bahamas must focus on “how we grow from here” because returning to pre-COVID’s $13Bn economic output is “not sufficient to take the ship of state forward”, a governance reformer argued.
• Hubert Edwards, head of the Organisation for Responsible Governance’s (ORG) economic development committee, told Tribune Business that The Bahamas’ “comeback” from the depths of the COVID pandemic in less than three years should not be diminished or ignored.
• The Bahamas National Statistical Institute (BNSI) unveiled data showing 2022’s real gross domestic product (8%) was slightly higher than that of the last COVID-free year of 2019 (1.6%); however, there was already consensus that this level of economic output is still some $3Bn short of what is required to meet the country’s economic and fiscal objectives.
• With the Government seeking to increase its revenue-to-GDP ratio to 25% by the 2025-2026 fiscal year (from 20.2% in FY 2021/22), and the recently-published Fiscal Strategy Report setting targets for a near-$16Bn nominal GDP and $4Bn in annual government revenues by 2027, Edwards expressed that achieving these goals should now be the priority for policymakers.
• Notably, the targeted $16Bn nominal GDP for the 2026-2027 fiscal year means the Bahamian economy has to expand by just over $3Bn in four years if that goal is to be achieved. And government revenues will have to increase by $1.2Bn over the same time period to strike the $4Bn mark.
• This begs the question of whether this growth will be achievable given that the nation has not seen a sufficient change in prior infrastructure, policies, and the system in recent times and whether tourism has the legs to move the nation beyond that point.

(Sources: CariCris & The Ministry of Finance (Bahamas))