NASSAU, BAHAMAS- The Bahamian economy grew moderately in the first half of 2025, slowing from 2024 due to softer stopover tourism and a nearly two percent decline in external reserves, with the Central Bank forecasting stronger tourism receipts later this year driven by higher hotel rates and increased forward bookings despite steady occupancy
During the Central Bank’s quarterly press briefing, Governor John Rolle acknowledged the challenges facing the tourism sector and the broader economy.
“I think we have a good appreciation for the fact that some of the ability to grow stopover depends on the inventory for accommodation. There is a recognition of that.”
He also noted that visitor patterns affect occupancy: “Sometimes you may have a period during the middle of the week when occupancy levels are low, and if the visitor vacation pattern is concentrated around the weekend or just a few days out of the week, then it’s the occupancy potential within that period that is more likely impacting our results.”
Despite these challenges, the accommodation sector continues to expand. “You do see the incredible response in terms of the amount of occasional rental units that are still being added to the accommodation stock. And that is being backed up by increased sales in that space,” Governor Rolle added.
Governor Rolle noted that data from the Central Bank shows that while stopover arrivals dipped slightly, average room rates rose, helping to offset the decline. The vacation rental segment experienced nearly a 10 percent rise in room sales, supporting overall tourism receipts. Meanwhile, cruise visitor numbers continued to grow steadily, providing additional revenue.
The softer tourism growth early this year contributed to a two percent drop in external reserves by late July compared to the same period in 2024, reflecting the more tempered inflow of foreign currency. Commercial banks’ purchases of foreign currency from the private sector — which correlate with tourism, investments, and other activities — rose only 1.3 percent in the first half of 2025, down from 2.2 percent in the same period last year.
Governor Rolle noted that credit growth remained firm, with domestic banks increasing lending across consumer loans, mortgages, and commercial activities. Credit risk improved, with non-performing loans dropping from nearly 6 percent in 2024 to about 5 percent by mid-2025.
Looking ahead, Governor Rolle expressed cautious optimism. “Our analysis of online travel sites and forward bookings and pricing data forecasts better hotel sector revenues over the remainder of 2025 compared to the second half of 2024,” he said, “based on higher average room rates but without any forecasted uptick in occupancy.”
