The Government of The Bahamas issued a release today indicating that it is pleased to learn that Moody’s has affirmed the A3 bond ratings of The Bahamas. This reaffirms the credit profile of the country.
The Government also acknowledged the rating agency’s revised outlook of the Bahamian economy from stable to negative. *“The recent global economic and financial crisis profoundly impacted the Bahamian economy and required extraordinary levels of spending on the part of the Government to safeguard the financial system, boost economic activity and provide assistance to Bahamians badly in need of help in these trying times, this at a time when government revenue experienced precipitous declines.”*
The release noted that the unusually high rise in debt levels therefore was not surprising and,in fact, had been forecasted by the Government in light of the worse global economic and financial crisis since The Great Depression. *“Despite this, we maintain in the circumstances a debt-to-GDP ratio that is one of the lowest in our region.”*
The Government emphasised its continuing goals to: (1) Reduce the level of deficit spending, as is proposed in the 2011/2012 fiscal budget relative to the crisis period, (2) Reduce the growth rate of the debt-to-GDP ratio as again is proposed in the current budget; and (3) Eventually decrease the debt- to-GDP levels in order to reestablish the fiscal space the country enjoyed prior to the onset of the crisis. *“We acknowledge that there are challenges in the global economic environment generally, but more particularly that of the United States of America to pursuing these aims, but our focus in achieving them will not be diminished. Both the medium term and long term wellbeing of our people depend on our achieving these objectives.”*
Ongoing efforts will continue to focus on promoting broad economic growth through innovative marketing programmes in tourism, pursuit of new opportunities for international financial services, increased investment promotion, expanding support to and opportunities for small and medium sized enterprises, increasing the ease with which business is done in The Bahamas, so as to improve the nation’s profile as a prime jurisdiction within which to do business; modernizing the nation’s infrastructure; and pursuing a fiscal policy that reduces the debt burden and creates an optimum environment for economic growth and prosperity for people throughout the Commonwealth of The Bahamas. To these objectives, the release stated, the Government remains committed.