Outlook Good For Bahamian Economy Says Central Banker

by Amanda Banks, Tax-News.com, London

18 April 2005

Outgoing Bahamas Central Bank Governor Julian Francis has predicted that the jurisdiction's economy is set for continued expansion in 2005, although he warned that rising US interest rates and unstable energy prices add a degree of uncertainty to the outlook.

In an interview with the Nassau Guardian last week, Mr Francis stated that there was no reason to be unduly pessimistic over the outlook for the Bahamian economy in 2005, noting that the indicators were favourable for the next three to six months.

He went on to add that economic growth would increase over the next 12 to 15 months.

"Because it seems to us that economic growth is reasonably well grounded. I don't think that there are any major threats to that in the short term," Mr Francis noted.

"We expect the current trends to continue and we believe that some of the underlying economic driving factors, which currently account for the pace of growth in our economy will continue to be supportive," he added.

However, the Central Bank chief, who is set to retire at the end of next month after twelve years in the job, acknowledged that rising interest rates in the US would likely quell demand in the Bahamas tourist sector, and also warned that continued fluctuations in oil prices could force the Central Bank to change its outlook.

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