The Tribune

EDITOR, The Tribune

In June The international Monetary Fund projected that the world economy will contract by 4.9%. Two thirds of the world’s governments borrowed US $11 trillion in June alone. The IMF forecast 12 trillion in loss to the global economy in 2020 and 2021 due to the pandemic. The world is beginning to reopen but the rate of infection is increasing in the US, Brazil and India which collectively produce over 20% of global GDP. A major concern is the US which accounts for 26% of infections worldwide according to Johns Hopkins University. The US is the number one consumer nation, so if the US is stumbling economically because of COVID-19, the world economy suffers. The majority of remittance and tourists for the Bahamas comes from the US, the Bahamas’ number one trading partner.

The Bahamas’ economic needs have increased since COVID-19 pandemic because of increased medical costs, increased unemployment relief and other government assistance and decrease in government revenue. The opening of the tourist industry in a measured way is a start but more than that is required. The IMF forecast the Bahamas’s economy will contract by 8.3% and the consumer price index will be 2.4%. This spells hard times for many Bahamians who have less income and higher prices. The Bahamas has never had IMF deals but both the people and the government are skilled at dealing with economic hardship. This time it is different. The global downturn is severe and unusual so the Bahamas will have to make a lot more internal adjustments with less international assistance.

The Bahamas needs to set up a committee that is innovative with radical solutions. There needs to be systemic changes. If the Bahamas treats this situation like all the other economic recessions, the results will be dire. Never in the history of the world has the world been so heavily indebted and experienced a pandemic simultaneously.

BRIAN ELLIS PLUMMER

Nassau,

July 13, 2020.