The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Stopover arrivals beat pre-COVID highs by more than 30 percent in September with the economy forecast to hold its “growth momentum” into 2024, the Central Bank said yesterday.

The banking regulator, unveiling its report on November’s monthly economic developments, praised “aggressive marketing” by The Bahamas for sustaining the country’s tourism rebound although it noted that economic growth will slow in line with its traditional and medium-term “potential”.

Still, the Central Bank confirmed that The Bahamas had matched its pre-COVID full-year arrivals record from 2019 in just the first ten months of this year. “On a year-to-date basis, total arrivals strengthened to 7.2m visitors vis- à-vis 4.8m in the corresponding 2022 period,” it said.

“Contributing to this outcome, air arrivals increased to 1.3m passengers from 1.1m in the prior year, reflecting gains in all major markets. Likewise, sea arrivals accelerated to 5.9m from 3.7m visitors in the previous year.

“The most recent data provided by the Nassau Airport Development Company (NAD) indicated that total departures in October, net of domestic passengers, grew by 19.6 percent to 100,000 compared to the same period last year. Specifically, US departures increased by 20.2 percent to 90,000, while non-US departures rose by 16.5 percent to 15,000 vis-à-vis the prior year,” the Central Bank added.

“On a year-to-date basis, total outbound traffic advanced by 25.2 percent to approximately 1.3m passengers. In particular, US departures moved higher by 25.3 percent to 1.2m visitors relative to the same period in 2022. Likewise, non-US departures increased by 24.4 percent to 200,000 visitors compared to the corresponding period last year.”

Turning to the monthly performance, the Central Bank added: “Monthly data suggested that, in October, tourism sustained its robust growth momentum, with healthy gains in both the high-value air component and sea traffic. The aggressive marketing efforts of The Bahamas have reinforced continued elevated demand for travel in the aftermath of the pandemic.

“Official data provided by the Ministry of Tourism showed that total visitor arrivals rose to 0.57m in September from 0.47m in the comparative period of 2022. Specifically, the dominant sea segment increased to 0.5m from 0.4m passengers in the previous year. In addition, air traffic stabilised at 70,000 - representing 130.2 percent of the pre-pandemic high that was recorded in 2019.

“A breakdown by major port of entry showed that total arrivals to New Providence expanded to 220,000 visitors from 200,000 in the year prior. Supporting this outcome, sea passengers advanced to 160,000 from 140,000 a year earlier, while air traffic steadied at 60,000 visitors,” the Central Bank added.

“In addition, foreign arrivals to the Family Islands rose to 300,000 from 240,000 in the prior year, as respective sea and air arrivals totalled 290,000 and 8,823. Further, arrivals to Grand Bahama amounted to 40,000, surpassing the 30,000 registered in the preceding year, as sea and air visitors measured 39,831 and 2,068, respectively.”

As for the vacation rental industry, the Central Bank said: “Positive trends were affirmed in the short-term vacation rental market. The latest data provided by AirDNA showed that, in October, total room nights sold moved higher to 149,549 from 115,152 in the corresponding 2022 period. Underlying this outturn, the occupancy rate for entire place listings firmed slightly to 52.9 percent from 51.7 percent a year earlier.

“Conversely, the occupancy rate for hotel comparable listings fell marginally to 50.2 percent from 51.1 percent in the previous year. Further, price indicators revealed that year-over-year, the average daily room rate (ADR) for entire place listings rose by 6.5 percent to $543.08 and, for hotel comparable listings, by 3.5 percent to $195.16.”

Focusing on The Bahamas’ economic outlook, the Central Bank said: “The domestic economy is anticipated to maintain its growth momentum in 2023, supported by robust gains in tourism output. However, the pace of expansion is projected to slow as the economy converges closer to its medium-term growth potential....

“In the labour market, ongoing improvement in employment conditions is projected, with additional job gains concentrated largely in the construction and tourism sectors. In price developments, inflation is estimated to remain high in the near-term, although trending downward over the medium term with a lag, attributed to slowing price trajectories in the major trading markets and delayed fuel cost pass-through in domestic energy costs....

“In addition, external reserves are forecasted to remain buoyant in 2023, remaining above international benchmarks supported by anticipated foreign currency inflows from tourism and other net private sector receipts. Consequently, external balances should remain more than adequate to maintain the Bahamian dollar currency peg.”

The Bahamas’ external reserves declined by $90.7m to $2.495bn at end-October 2023, although this represented a more measured decline than the $187.9m contraction during the same month in 2022.