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Bahamas: Economic Outline

Economic Indicators

After having been strongly impacted by the global financial crisis, the Bahamas has regained a positive economic growth, which has slightly accelerated in 2011 (+2%) thanks to the revival of the tourism activities (an increase in the number of visitors and the development of new sites in construction). Inflation is about 4%. The country should experience a light economic growth in the next few years. The Bahamas has a very high GDP per capita (USD 23,000, which represents the third highest rate in the Americas after the United States and Canada).

Considering that the country has few natural resources and an insubstantial industrial sector, the economy of the country depends strongly in the tourism sector (60% of GDP) and in a lesser degree to its financial services. The crisis has deteriorated the fiscal position of the country: the weight of the public debt has risen and the ratio debt/GDP has increased. Budgetary measures have been implemented in order to re-balance the situation and to reinforce the financial system in order to improve its control. In a parallel direction, the government has initiated significant efforts to improve the basic public services infrastructures (energy, water and transportation) and to support the tourism sector, which is essential to the economy. Numerous real estate projects are being planned as well as public and private infrastructure projects (roads and airports).

The opposition political party, nevertheless, has criticized the privatization economic plan conducted by the First Minister Ingraham, and most of all the choice of hiring Chinese manpower (almost 8,000 Chinese workers are in charge of the construction of one of the largest hotels complex in the archipelago, financed in its majority by the Export-Import Bank of China), while the unemployment rate in Bahamas is 13.7%. The Bahamas has a very high crime rate, with one of the highest homicide rate of the region (30 for every 10,000 inhabitants). The government, consequently, has established new tribunals specialized in the issues related to the traffic of drugs and firearms. 

Socio-Demographic Indicators	2011	2012 (e)	2013 (e)
Unemployment Rate (%)	13.7	11.0	9.5

Source: World Bank - Last Available Data

 

 

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Indicator of Economic Freedom

Score:

68.0/100

Position:

Moderately free

World Rank:

42/179

Regional Rank:

5/26

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

 

Country Risk

See the Country Risk Analysis Provided By Ducroire.

 

Indicator of Political Freedom

Ranking:

Free

Political Freedom:

1/7

Civil Liberties:

1/7

Map of freedom 2010
Source: Freedom House

Note: The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

 

Sources of General Economic Information

Main Online Newspapers and Portals

The Bahamas Journal
The Nassau Guardian
Bahamas Newspapers, Magazines and News Sites
Official tourist website of Bahamas

Useful Resources

Ministry of Finance
Central Bank

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Last Updates: May 2012