Bahamian government paints bleak economic picture
Declaring that the government’s “cupboard is bare”, Bahamian Deputy Prime Minister and Finance Minister Peter Turnquest has served notice that the country will have to resort to borrowing $722 million to stay afloat.
After delivering the national budget last week, he told reporters that the new Hubert Minnis administration is not only grappling with spiraling debt, but has been left with little to no revenue – thanks to the former Perry Christie Government.
“To cover the fiscal overhang for 2016-17 we need to borrow $400 million. What it means is that we have bills outstanding today that we have to borrow to meet because of the fact that there was no provision made for those expenditures in the previous budget,” he said, adding that $322.4 million will be borrowed for the 2017-2018 Budget.
The Finance Minister reported that the “situation is far bleaker than we could have ever imagined”, pointing out that the former government had woefully underestimated the country’s debt.
“The deficit outturn in the current fiscal year features a significant deterioration as compared to the fiscal projections contained in the previous final budget. While they had forecast a GFS deficit of $100 million, the actual out turn is now expected to be in the order of $500 million. That is an astonishing five times the budget forecast of only 12 months ago,” Turnquest said.
He assured that the government would take immediate action to rein in the deficit and return the country’s debt level to more sustainable levels.