The Tribune

By KHRISNA VIRGIL

kvirgil@tribunemedia.com

DESPITE an economically trying 2011, the Bahamas' economy is expected to experience some growth this year, State Minister of Finance Zhivargo Laing said.

“We forecast that the Bahamian economy will grow about 2.5 to 2.8 per cent this year, 2012, consistent with the IMF. Unemployment is likely to remain in double digits, though some continuing decline from 13.8 per cent is expected. We further expect to sustain out growth trajectory with 2.4 per cent in '013 and 2.3 per cent in '014,” he said.

Last year, the economy grew by 2.0 per cent with a slight decline in unemployment to 13.7 per cent, said Mr Laing.

While the past four years were difficult for the economy, Mr Laing said the government was still able to manoeuvre fairly well.

“Given revenue decline of some $23 million from 2006/2007 and $114 million from 2007/2008 compared to 2008/2009, we would have had to reduce spending by some between $23 million and $114 million. This would have meant either severe layoffs of civil servants, deep cuts in salaries of public officers, or deep cuts in Government services, deep cuts in public sector investments or a combination thereof for at least two years to three years. The impact of this on an already devastated and fragile economy is obvious.”

According to Mr Laing, had the government decided to take that route, none of the major projects would have got underway. “If we had decided to hold the line, it would mean that much of what you see that has gone on or is going on now; at the airport, at the harbour, at Arawak Cay, with the utilities and roads, the employment programmes could not and would not be occurring.”

On the other hand, Mr Laing said some proactive measures could be taken to ensure the economy continues to thrive. “We could take a long-range view. That would mean laying the foundation for a more resilient, robust and dynamic economy and society in the years to come by strategically spending the necessary significant borrowing we would have to do.”

With that foresight, the government, said Mr Laing, undertook “the most dramatic, comprehensive reforms and modernisation seen in our country in generations”.

The New Business License Act, the New Securities Act and the Utilities Regulation and Competition Authority Act (URCA) were among major legislation that received great attention from both parliamentarians and the public.