Bahamas PM says country’s debt will increase

Dr Hubert Minnis, Bahamas’ PM, says the government plans to restart the economy.

The Bahamas government is projecting US$8.2 billion in debt at the end of June as well as a deficit of US$677.5 million as a result of the damage caused by Hurricane Dorian last September, revenue loss and a number of other spending imperatives.

Prime Minister Dr Hubert Minnis, in delivering the mid-year budget to Parliament on Monday, acknowledged that the “figure may seem daunting” but was confident that his administration “has a plan to restart the economy.”

“Our government debt, which was forecasted at some US$7.6 billion, is now anticipated to stand at approximately US$8.2 billion at end-June 2020.”

— Minnis

Minnis said that the government was also confident of restoring the lives of the people of Abaco and Grand Bahama, the two islands hardest hit when the Category 5 storm swept through the archipelago on September 1 last year, killing 70 people and causing damage estimated at US$3.4 billion.

Effects of the hurricane

Minnis, who used his presentation to compare his administration policies in handling the effects of the hurricane as compared to the previous administrations, said at the outset of the 2019/20 budget, his government had projected a deficit of US$137 million, “which has now been expanded to US$677.5 million to account for hurricane recovery spending, revenue loss, and a number of other spending imperatives.

“Our government debt, which was forecasted at some US$7.6 billion, is now anticipated to stand at approximately US$8.2 billion at end-June 2020,” he said, adding that apart from the massive package of tax breaks and economic incentives granted in the wake up of the storm, the government has pioneered a number of foreign direct investment (FDI) projects that will create jobs for Bahamians.

He told legislators that these projects will produce “new and exciting activities that will attract more tourist to our shores, and ultimately help to propel our economy to a full rebound.

“Our commitment to restoring the lives of our fellow Bahamians goes well beyond this fiscal year. As outlined in our Fiscal Adjustment Plan, we expect that fiscal recovery will take approximately five years, although economic recovery is expected to continue beyond that horizon,” Minnis said, adding “the return to normalcy is no small task, but my government is certainly up to the task.”