‘PERILOUS STATE’: MOF charts economic recovery to budget surplus by 2024/25 in fiscal strategy report

‘PERILOUS STATE’: MOF charts economic recovery to budget surplus by 2024/25 in fiscal strategy report
(FILE)

Ministry of Finance releases 2021 Fiscal Strategy Report and Medium-Term Debt Management Strategy

NASSAU, BAHAMAS — The Ministry of Finance (MOF) projects an increase in revenues of up to 25 percent of GDP by the fiscal year 2025/26 with a cap on recurrent and capital expenditure to 20 percent and 3.5 percent of GDP, within the same period.

The ministry outlined steps to restore the country’s fiscal health from its perilous state with measures like digitization, continued economic diversification, and improvements in revenue policy & administration in tandem with containing expenditure, in its 2021 Fiscal Strategy Report released today.

The MOF statement read: “The nation’s fiscal health is in a perilous state. As outlined in the 2021FSR, The Bahamas’ fiscal health will be restored by improving Government efficiency through digitization, continued economic diversification, and improvements in revenue policy & administration to achieve revenues of 25 percent of GDP by the fiscal year 2025/26.

“Containing expenditure will be equally important in achieving fiscal targets and Government intends to limit recurrent expenditure to 20 percent of GDP and capital expenditure to 3.5 percent of GDP by the end of the same period. The planned result is the achievement of a modest budget surplus by the fiscal year 2024/25.”

“The MTDMS outlines the Government’s strategy to manage the stock of existing debt which has ballooned in recent years, refinance maturing debt and achieving an optimal debt portfolio,” the statement continued.

“The prudent management of the Government’s debt obligations is essential to achieving fiscal sustainability and building resilience to withstand future exogenous shocks (such as weather-related events and health pandemics), contributing to stable long-term economic growth, and protecting The Bahamas’ creditworthiness among investors.”

The Ministry of Finance released both the 2021 Fiscal Strategy Report (2021FSR) and the 2021 Medium-Term Debt Management Strategy (2021MTDMS) to the public today.

The statement read: “The Government previously advised that the presentation of these reports would be delayed to avoid clashing with the presentation of the FY2021/22 Supplementary Budget. The Minister of Finance would formally table these reports during the FY2021/22 Mid-Year Budget debate.

“The FSR and MTDS are important documents that outline the Government’s medium-term fiscal framework; however, this administration believes that tying the formal presentation of these documents to a Parliamentary debate is unnecessary and would be making the legislative change to discontinue this requirement.”

The Ministry invites and encourages the public to visit the national Budget Website (www.bahamasbudget.gov.bs) to view the various statistical reports available to the public.

About Ava Turnquest

Ava Turnquest is the head of the Digital Department at Eyewitness News. Her most notable beat coverage spans but is not limited to politics, immigration and human rights, with a focus especially on minority groups. In 2018, she was nominated by the Bahamas Press Club for “The Eric Wilmott Award for Investigative Journalism”. Ava is deeply motivated by her passion about the role of fourth estate, and uses her pen to inform, educate and sensitize the public.