As analysts of geopolitics ponder the possibility of a war in the Middle East , those responsible for governing the Bahamas must also think of a strategy to improve the economy of the Bahamas with or without a war. An attack on Iraq by the United States will undoubtedly cause some constriction in the Bahamian economy. However, since some Bahamians believe we are a part of south Florida , even some parliamentarians and local economists see no need for a war strategy.
In a worse case scenario, The Bahamas will find ways to cope. In tourism, since there will be an immediate increase in oil prices, gas prices at the pump would increase driving up the cost of goods and services. There is expected to be a decline in visitor arrivals, consequentially the cost of operating hotels would escalate.
The hope is that Americans will choose the Bahamas as a vacation destination over Europe as they did during the Gulf War in 1991. While this is optimistic, it is safe to conclude that the Bahamas will have a fall-back position in tourism.
The Bahamas can do a little better than just stand still “to see the salvation of the Lord.” Currently, the government is spending more than Sun International, now Kerzner International to promote our tourism product in North America. Yet Atlantis appears to be getting more out of its promotions than The Bahamas as a whole.
Today many officials in the tourism industry consider the product in The Bahamas to be Atlantis, as the Paradise Island property has become synonymous with The Bahamas. The profits which Kerzner is deriving from its Paradise Island property is running at about 20 percent, which leaves serious Economists to believe that Kerzner has already paid for the investment in The Bahamas.
Whether The Bahamas has to contend with a war or not, we have to develop the expertise among industry professionals to deal competently with the sophistication in the Bahamian economy. For starters, we have to re-think our tourism product and how ewe use the precious resources of the country to promote tourism and whether we are getting value for money. We have to re-examine where the money is spent and how it is spent.
On the fiscal management of the country’s affairs, in the worst case, The Bahamas will be forced to apply to international agencies to tide it over. The Bahamas has never drawn down on the emergency facilities of the International Monetary Fund, The World bank or the Inter-American Development Bank.
Currently, thee is no indication of a deep recession in The Bahamas as actual revenue last November increased by $8 million and by $15 million in December over the same period a year earlier.
This does not mean that there is no sagging of the economy and that the political directorate should not plan to revitalize it.
In the face of global recession, the government needs to be bold and resolute in formulating new strategies and implementing policies to meet economic challenges. It must be conceded that action must be taken to reduce the unemployment rate. The jobless rate is growing as the Financial Services sector shrinks. Not only does unemployment have a direct financial impact on all our citizens, but it also poses a threat to social order and stability.
U.S. President George W. Bush has affirmed that the United States would use its “position of unparalleled military strength and great economic and political influence” to work to bring the hope of democracy, development, free markets and free trade to every corner of the world.
This grand strategy, which seeks to shape an environment in which freedom can flourish, rather than passively hoping for the best, takes on more urgency in the wake of the September 11 terrorist attacks on the United States. These events showed that weak states could pose as serious a threat to U.S. national interests as strong states.
There is no doubt that failed states, broken societies and extreme poverty create the fertile ground in which the seeds of terrorism can grow.
The U.S. Patriot Act instituted last year has the potential of wreaking havoc on the economy of The Bahamas as financial services come under even more increased and intense scrutiny. Terrorism is now defined as whatever the Americans wish to define it as. They are linking any nefarious activity to terrorism. The Bahamas , meanwhile, can only stand still and take notice.
Insight, The Bahama Journal
