According to the preliminary results, the GDP in Current Prices for 2012 had a positive growth of 3.5%, while GDP in Constant Prices grew at 1.83%. The current measure utilizes current price levels and currency values, without factoring in inflation and determines the total value of the products and services produced in a particular year. The Constant Prices measures the effects of inflation and is more useful for studying trends in economic growth. These preliminary figures will be revised as more data become available.

The 2012 results are based on early estimates from major data sources such as the Central Bank, Ministry of Tourism, and the Foreign Trade Section of the Department of Statistics. They are also based on indicators which normally mimic movements of particular industries such as Hotel Room Rates, Megawatt Sales, Building Permits, Chargeable Telephone Minutes, Consumer Price Index, etc.

The growth at constant prices was due to increases in the Construction Industry, Manufacturing, Hotel Industry and Marine Transport In contrast, Fisheries, Electricity, Mining, Banking, Insurance and Real Estate/Gross Rents declined.

Others statistics released included:

• The Gross Capital Formation in Constant Prices grew by 20.6%. The impetus in this sector was Non-Residential Construction and Machinery and Transport Equipment which increased by 97% and 22.6%, respectively. This build-up of these fixed assets was the direct result of major capital projects such as the BahaMar and the Airport Expansion Projects, etc.

• The Private Final Consumption Expenditure (PFCE) or Household Expenditure which represents 70% of the GDP, increased in Current Prices by 2.9%. This increase was mostly in the Wholesale and Retail Trade Industry which grew by 5%, and Household Expenditure Abroad which grew by 20%. Contrary to the overall PFCE current growth, a slight decrease was measured at Constant Prices, where PFCE declined by 0.7% as part of the constant growth was mainly due to the increased prices. This decline is due to the All Items NP Consumer Price Index used to deflate the PFCE, which moved from 135.5 in 2011 to 138.4 in 2012.

• The Government Final Consumption Expenditure (GFCE) is split between Individual Consumption and Collective Consumption. In 2012, The Individual Consumption which includes Health and Education grew by 1.6% at Constant Prices and the Collective Consumption, which represents the remaining services, experienced a 2.5% growth.

The National Accounts 2012 Report with detailed tables will be available at the end of April 2013 on the Department’s website.

“No country is projected to report annual rates of more than 1.5 per cent with the exception of The Bahamas, which will report growth of some 2.5 per cent”, Moody’s said in its analysis of Caribbean economies in 2013.

The Moody’s report nonetheless noted that the Government still had much work to do on the fiscal side, noting the worsening of the fiscal balance by more than 4 percent of GDP between 2008-2012, and a foreign currency debt equivalent to 20 per cent of GDP.

Minister Pinder outlined key components of the approach taken by the Government:

(1) Responsible and efficient expenditures causing savings where they can be achieved;

(2) Ensuring revenues owed to the Government are efficiently and effectively collected without raising taxes to Bahamians; and

(3) Ensuring policies for economic growth and advancement for Bahamians and companies not only exist but are continually and aggressively advanced.

Financial Services

The Minister reported that his Ministry, through each key area of its portfolio, has engaged on a comprehensive review of the state of the economy, and developed initiatives and strategies to advance The Bahamas. “We have caused the profile of The Bahamas to be raised in each instance, and have provided for continued education for Bahamians and development of the country.”

In followup to a 6-month initiative announced shortly after taking office, the Minister launched the Ministry’s 10-year strategy for the redevelopment of the financial services at BFSB’s International Business & Finance Summit last month in Bimini. This included, as well, a rebranding of The Bahamas as a full business services centre, and a comprehensive approach to increasing the competitiveness of The Bahamas as a business centre. In this connection, the Ministry is focusing on Human Capital Development, Competitiveness and Innovation.

Outlining some steps already taken, Minister Pinder said:

** We are determined to be engaged with the region and to take a leadership position on matters which affect our second industry. In this context, we are in the process of ensuring a regional committee of Financial Services is launched to address many of the international outcomes in financial services collectively. Our sovereignty allows us the unique position to make policy taking into consideration Bahamian interests as a priority.*

** The Ministry of Financial Services, consistent with the pledges made, have caused for sector and geographic analysis to be conducted, ensuring that key markets of growth are identified and pursued. Certainly key markets in Latin America as well as North America have been identified for growth. We also have identified particular sectors for growth, such as the fund business given our recent achievement of IOSCO A status, and we prepare to launch a new strategy for captive and international insurance, as new product enhancement.*

** Consistent with the forecasted financial services industry review, we developed certain concerted policy initiatives to advance the industry, and the participation and advancement of Bahamians in the financial services industry.*

** We in the Ministry of Financial Services are excited about launching the program to develop the jurisdiction as a preeminent International Commercial Arbitration Center. The Ministry of Financial Services have partnered with the Chartered Institute of Arbitrators branch here in The Bahamas to cause for joint educational initiatives of our professional industries, judiciary and Bahamian students. This is imperative to ensure capacity is developed and build upon in the furtherance of the Bahamas as a world renowned arbitration center. We have to likewise build capacity in our practitioners on the international stage. With leave of the Prime Minister, we will cause the International Arbitration Council of The Bahamas to be formed, designed to provide advice and guidance to the Government on infrastructural needs and other matters relative to the establishment of the International Commercial Arbitration Centre.*

With relation to the trade portfolio of the Ministry, Minister Pinder also spoke the launch of a Value Added Trade Strategy for The Bahamas, with a focus on actively utilizing existing and prospective trade agreements to foster regional integration, develop business networks and enhance this nation’s trade infrastructure.

Commending the Prime Minister and the Minster of State for Finance for their balanced approach to prudent stewardship, Minister Pinder pointed out that the Ministry of Financial Services is not only the representative ministry of the second pillar of the economy, but is also responsible for the promotion and development of the economies related to international trade and industry. “Each component is an important element of our economic development, one building on the other. A robust industrial sector supports a trade agenda. A dynamic trade industry provides the foundation for the expansion and further development of the financial services industry.”

Moody’s pointed out that the economy contracted at an average rate of 0.8 per cent annually between 2007 and 2011 and it expects the post-crisis recovery to remain fragile. The Government’s fiscal stimulus programme is yet to yield growth dividends and unemployment remains high, depressing domestic demand, according to the rating agency.

The Bahamas Government has pledged to unveil a strategy to address “the fiscal imbalance” in its Mid-Term Budget Statement, reinforcing its commitments to get the public finances back on a sustainable path.

Moody's Investors Service is a leading provider of credit ratings, research, and risk analysis. The firm's ratings and analysis track debt covering more than 110 countries, 11,000 corporate issuers, 22,000 public finance issuers, and 94,000 structured finance obligations.

The National Symposium of Tax Reform is scheduled for October 25-26, 2012 at The College of The Bahamas, held under the patronage of His Excellency, the Governor General of The Bahamas, Sir Arthur Foulkes.

The objectives of the Symposium as defined by the Steering Committee are to:

• Establish a non-partisan, national discourse on fiscal practices with thematic and global experts and specialists
• Promote a more informed citizenry
• Encourage wider dissemination of information on options for tax reform in The Bahamas
• Produce a post Symposium report on the findings and policy implications of tax reform in The Bahamas.

Predicting an economic turnaround notwithstanding the economic challenges facing the country, he said he was optimistic about the future of the economy. “We live in a very sound democracy. We have been able to demonstrate that there is a culture of change, that we have been able to change from political party to political party and that the substance of our democracy remains intact,” he said.

The Prime Minister affirmed that there has to be a dedicated effort made in continuing to stimulate the economy, pointing to direct foreign investment still available to The Bahamas. He said “...We have to find a way to accommodate ourselves by our policies to that.” Noting that his optimism about the economy is based on and encouraged by the reality that there are people in the world who see The Bahamas as a significant place to invest, he continued “We are very encouraged as we are working very hard to create the kind of environment and culture in which institutions like CIBC FirstCaribbean Bank can prosper.”

In The Bahamas, CIBC FirstCaribbean has 665 employees in now 14 branches in New Providence, Grand Bahama, Eleuthera and Abaco. There are also satellite branches in Green Turtle Cay, Man-o-War Cay and Hope Town, Abaco. Managing Director, Marie Rodland-Allen, says it was “imperative” that the bank have a presence in the new community, what with the proliferation of small businesses and retail outlets in the Carmichael Road area, “The Carmichael road area is probably the fastest growing area, not just in New Providence but probably in any other community across The Bahamas.” Some 18 persons will be employed at the state-of-the-art Carmichael Road branch, which boasts the latest technology and equipment.

A major Caribbean bank offering a full range of market-leading financial services in Corporate Banking, Retail Banking, Wealth Management, Credit Cards, Treasury Sales and Trading, and Investment Banking, CIBC FirstCaribbean is the largest, regionally-listed bank in the English-speaking Caribbean. It has assets of over US$10.9 billion and market capitalisation of US$2.5 billion; over 3,400 staff; 66 branches, 22 banking centres, and seven offices in 17 regional markets, serving 550,000 active accounts. The Bank was formed in 2002 with the merger of CIBC West Indies Holdings and Barclays Bank PLC Caribbean operations under the name FirstCaribbean.

The change in the short-term foreign currency resulted from the revision of Standard & Poor's criteria on the linkage between long-term and short-term ratings for sovereigns. The Bahamas' track record of political and macroeconomic stability has delivered high per capita GDP, but the Bahamian economy remains vulnerable due to dependence on one primary sector and geographic market . S&P projects growth of 2.5% in 2012 and 2013 as tourism-related construction supports growth, despite a sluggish outlook for the U.S. economy.

The agency said the ratings could come under pressure if The Bahamas’ fiscal deterioration persists and its economic base erodes more severely. Conversely, the ratings could be raised if the government takes a more proactive policy response to reduce debt or if economic prospects strengthen, more sharply improving the country’s external balance sheet.

That notwithstanding, the Chairperson of the Working Party, Ambassador Wayne McCook (Jamaica), said that The Bahamas has considerable work ahead as adherence to WTO rules requires domestic reforms as well as putting in place the necessary enforcement infrastructure.

Ambassador McCook noted that the presence of a high-level delegation to attend the Working Party meeting manifested The Bahamas’ desire to integrate more fully into the multilateral trading system through its accession to the WTO. The Chairman has requested the WTO Secretariat to prepare a “Factual Summary of Points Raised” outlining the discussions in the Working Party.

The Bahamas delegation to the Working Party meeting in Switzerland included new Minister of Financial Services, the Hon. Ryan Pinder, M.P. Minister Pinder confirmed that WTO accession was an important part of the government’s programme to accelerate trade and economic development as well as to create more and better jobs for Bahamians. He added that The Bahamas has been an open economy for many years but as a small island nation it is very dependent on tourism and international financial services. Minister Pinder also referenced the financial services sector as the second largest contributor to The Bahamas’ GDP and one that provides high-paying jobs and career opportunities for Bahamians. He stated that predictable access to world markets for goods and services originating in The Bahamas was one of the necessary preconditions for his government’s economic expansion strategy to succeed.

The Bahamas currently holds Observe Status in the WTO.

New Governments traditionally use this occasion to lay out their plans for the new Parliament and their administration. Sir Arthur said the Government’s ambitious and extensive agenda in this connection had two overriding imperatives:

• Firstly, the need to reduce violence and crime and build a safer Bahamas.

• Secondly, the need to build a stronger economy that generates jobs, deepens and broadens Bahamian ownership and produces a higher standard of living for all Bahamians.

Referencing the Vision 2030 “Charter for Governance” released pre-Elections, the Government affirmed that it will move resolutely to implement the full range of programmes, legislative proposals and policy initiatives promised.

The Speech concluded with expressions of “belief” in Bahamians and in their capacity and determination to overcome all the many challenges ahead. “Armed with a common purpose and united in patriotism and love for one another, we shall indeed overcome, and achieve for our nation the greatness that is its destiny,” said the Governor-General.

The Government has released its Allocation of Ministerial Portfolios.

Outgoing Prime Minister Hubert A. Ingraham conceded the elections last night, also announcing that he will resign from active politics.

Prime Minister Christie said at Government House today that his full slate of Cabinet Ministers will be announced by the end of the week.

About the Prime Minister

The Rt. Hon. Perry Gladstone Christie was born in Nassau on August 21st, 1943.

Named Senator by Prime Minister the Rt. Hon. Sir Lynden Pindling in November, 1974 he is believed to have been the youngest Bahamian ever appointed to the Senate. Mr. Christie served in that capacity until June, 1977. In January of that year he was appointed Chairman of the Gaming Board. Receiving the PLP’s nomination for the Centreville constituency in the 1977 general election, Mr. Christie was elected Member of Parliament for that constituency, and shortly after appointed Minister of Health and National Insurance. During the June, 1982 general election, he was re-elected Member of Parliament for Centreville, and once again was appointed to the Prime Minister’s Cabinet, as Minister of Tourism. He ran as an independent candidate in the 1987 general election, retaining his seat in the Centreville constituency. Three years later he returned to the fold of the Progressive Liberal Party, and was appointed Minister of Agriculture, Trade and Industry by the Prime Minister. In January, 1993 following the PLP’s defeat in the August, 1992 general election, Mr. Christie was elected Co-Deputy Leader of the PLP with responsibility for party activities outside Parliament.

Victorious in the newly created Farm Road constituency in the general election, he was appointed Leader of the Opposition by the Governor-General on April 07, 1997. He had been elected leader of the PLP at a special convention on April 05. Mr. Christie thus succeeded the late Rt. Hon. Sir Lynden Pindling, M.P., who had led the PLP since 1956 as both Leader of the Opposition and leader of the party.

He was sworn in as the third Prime Minister of an independent Bahamas on May 03, 2002, following his Progressive Liberal Party’s triumph over the Free National Movement in that year’s general elections.

Prime Minister Christie attended the Eastern Senior School in New Providence, the University Tutorial College, London, Inner Temple and Birmingham University, from which he graduated with honours in 1969.