NASSAU, The Bahamas – During his Budget Debate Closing Remarks, on June 17, 2024, Prime Minister and Minister of Finance the Hon. Philip Davis, said that, while much work remained, the Bahamian economy was finally moving in the right direction.
“We took an economy that had fallen to record lows and lifted it to new heights,” Prime Minister said in the House of Assembly. “Real Gross Domestic Product, GDP, has grown for consecutive years despite high global inflation. Not every country can say this.”
He added: “Global inflation does continue to act as a drag on our economic growth, however, as it does everywhere. And of course, when you lift up an economy from the deepest depths, an economy struggling from the stifling lockdown and curfew policies, you get the kind of meteoric growth in the first year that is followed by more moderate gains – explaining any decreases in year-over-year Real GDP gains.”
Prime Minister Davis noted that what matters most to Bahamians was that overall economic activity was up.
“Last year’s Nominal GDP, which measures total economic growth without taking inflation into account, was higher than forecast,” he said. “We forecasted a growth rate of 7.4% and actually achieved a rate of 9.2%.”
“In doing so, we exceeded international and local financial expectations when it comes to spurring economic activity and growing revenue,” Prime Minister Davis added. “The revision in the real growth forecast therefore does not reflect a slowdown in economic activity but rather something more technical, which is a spike in the GDP deflator, a metric which takes inflation into account.”
Prime Minister Davis pointed out that, since much of that inflation was imported, unfortunately, until other reforms his Government were advancing begin to take effect, The Bahamas must live with that reality. He added that, however, by any measure, economic activity continues to grow.
He said: “Unemployment is at its lowest rate since 2008. More visitors are experiencing the beauty of our islands than ever before, and prices are finally starting to go down. Revenues are increasing, driven both by the strength of our economy, as well as structural improvements, including a well-designed and well-executed compliance programme. The deficit is under control and there are regular primary surpluses.”
Prime Minister Davis noted that the Debt to GDP has decreased from over 100 percent to 79.9 percent in two years and it continues to decrease.
“These are the economic and fiscal indicators that can truly assess the health of a country. So, we’ll let the data speak for itself,” he said.
“International observers are astounded that we’ve been able to have the results we’ve had outside of a structural adjustment programme, which tells us we’re performing exceptionally well,” he added.
Prime Minister Davis stated that his Government had approved over $8 billion in investments to facilitate economic growth.
“And when we sit at the negotiation table with investors, we let them know that hiring and empowering Bahamians is a mandatory part of their plans,” he said.
“We make it clear that for any specialised roles that non-Bahamians are hired for, we are enforcing our Notice of Vacancy policies to ensure that a Bahamian will be trained to fill that role,” Prime Minister Davis added. “We inform them that Bahamian suppliers, taxi drivers, excursion company owners, vendors, creatives, and other small and medium-sized businesses must be incorporated into their plans.”
He noted that, as a result of his Government’s efforts, the country is seeing unprecedented levels of Bahamians hired throughout the nation, and more local businesses and entrepreneurs included in and around the premises of those major developments.
“Economic gains must bring widespread benefits for Bahamians – that’s the only thing that makes moral and economic sense to us,” Prime Minister Davis stated.
He added: “We’re also making sure more and more Bahamians are ready for new opportunities.
That’s why we are introducing the National Apprenticeship Progamme this year, to train and encourage our young people, preparing them to launch careers in the largest and most in-demand industries in our nation.”
Prime Minister Davis pointed out that his Government had committed 1.2 million dollars over a two-year period to the Culinary Skills Programme at The University of The Bahamas to prepare 200 young persons for entry-level jobs in the culinary field.
“The first class was in September 2023 and the University is preparing for its next class in September 2024,” he said. “These are positions that previous governments had to approve work permits for. Simple entry level jobs that can now be filled by talented Bahamians.
“I want to thank the Culinary and Hospitality team at the University of the Bahamas for bringing this programme to life, changing the status quo and changing the lives of hundreds of young Bahamians,” he added.
Prime Minister Davis pointed out that his Government was recruiting young Bahamians into the National Youth Guard to “strengthen our nation’s ability to respond during times of crisis”.
“I see our young people as a source of our strength – the same valuable skills they learn during their training to serve on the front lines during a disaster are also the skills supporting high rates of employment for participants once they graduate – because employers recognise the value of the training they received,” he said. “Once again, changing the status quo and changing lives.”
Prime Minister Davis noted that his Government was investing in the widespread economic empowerment of Bahamians through training and employment, as well as helping more Bahamians become owners in their country.
He said: “We are building affordable homes, after not one home was built by our predecessors.
Our Rent-To-Own Programme has taken time to build but will help even more Bahamians fulfil their dreams of owning a home. And, of course, we are investing millions in funding for Bahamian business owners through our grant and loans programmes, including $30 million in grants for farming and fishing businesses during the upcoming fiscal year.
“These grants will function as seed funding for the expanding agriculture and fisheries sectors.”
Prime Minister Davis pointed out that, as The Bahamas lowered grocery bills by feeding itself, the National Trade Facilitation Committee will pursue strategies to lower the food import bill up to one-third by identifying new policies and trade opportunities, forging new trade agreements and partnerships, and making shipment processes more efficient.
“This new investment in trade is significant – and it returns to my earlier point about the importance of developing and strengthening international relationships, and always seeking new opportunities,” he said. “The next global crisis may be around the corner – we can’t control that. But we can act to make our economy more resilient to external shocks. We can grow more of our own food and create the conditions which support diversifying our economy.”
