Bahamas: IMF provides macroeconomic policy response

Bahamas: The recently announced Concluding Statement from the Executive Board of the International Monetary Fund (IMF) grants further indication that the Government’s fiscal policy responses and economic management produce results in keeping with global best practices.

The Government is pleased that the Board of Directors of the IMF has agreed with the Government’s near-term priority to save lives and livelihoods and the Government’s decision to postpone the achievement of public debt targets by another two years in response to the pandemic.

The board of directors was delighted to see that the IMF’s board has supported its staff’s view that the Government’ has ascended a successful response to the pandemic.

Many have noted our policies’ effectiveness to develop social support through unemployment and food assistance and our targeted losses in recurrent and capital expenditures.

These have all helped to take care of Bahamians as we endeavor towards economic recovery and the IMF’s initial remarks show that our plan is working,” said Kwasi Thompson, Minister of State for Finance.

In response to the COVID-19 pandemic, the Government suitably shifted its financial policies towards granting relief to households. These citizens became unemployed due to the pandemic, the miniature business sector, and the health sector.

This focus recognized the Government’s consignment to placing the welfare of Bahamians and the small business community at the forefront of its policy response.

Given its financial constraints due to lower revenue intake from significant domestic economic activity reductions, the Government made difficult decisions to reprioritize expenditure by adjusting recurrent and capital budgets in targeted ways.

The Concluding Statement from the IMF Board has indicated that reprioritizing capital expenses and prioritizing social support were timely and suitable policy responses.

“We look forward to the release of the full Article IV report, which provides the complete assessment of the IMF staff regarding their views on the state and prospects for the Bahamian economy.

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