The Bahamas
The Bahamas has developed a thriving, internationally oriented economy based primarily on financial services and tourism.
IMF praises 30 years of prudent macroeconomic management
The Rt. Hon. Hubert Alexander Ingraham, Prime Minister and Minister of Finance
Area: 5,382 square miles Capital: Nassau Government: Democracy Population: 307,451 (July 2008) Language: English (official) GDP per capita: USD 25,000 Monetary unit: Bahamian dollar (BSD) Exports: mineral products and salt, animal products, rum, chemicals, fruit and vegetables Imports: machinery and transport equipment, manufactures, chemicals, mineral fuels, food and live animals
It is no surprise that The Bahamas’ tourism sector is going strong, because as a tourism destination, The Bahamas has it all: close proximity to the United States, outstanding natural beauty, and some of the world’s most luxurious hotels.
The financial-services sector also benefits from proximity to the United States but more importantly has been guided by far-sighted leaders who have focused on providing world-class services, an investor-friendly and reliable regulatory environment, and great diversity of offerings.
The financial-services sector had a good year last year. Market capitalization on the Bahamas International Securities Exchange (BISX) grew 24.3 percent to reach USD 3.9 billion.
The local construction sector is performing very well, too, with several large-scale projects currently underway. The Bahamas is also a major trading partner, relying on imports from the United States for almost all its food and manufactured goods.
The government’s current economic goals include balancing the budget and reducing debt to between 30 percent and 35 percent of GDP by 2012. The government also intends to improve tax administration, privatize national telecom and electricity companies, streamline import duties and tax concessions, and control public spending.
Four percent GDP growth in 2008
Like other developed countries, The Bahamas has been hard hit by rising oil prices as well as by uncertainty in global tourism. Nevertheless the country has been achieving steady economic growth for many years, with 3.3 percent growth in 2005 and 4.6 percent in 2006 followed by 2.8 percent growth last year.
The International Monetary Fund recently predicted 4 percent GDP growth for The Bahamas this year, and commended the country for its prudent macroeconomic management for the past three decades. The Bahamas has long benefited from its economic and political stability and has the highest standard of living in the Caribbean.
