PM: Economy turning around
Unemployment could reach”the lowest level ever seen”in the next four years, according to Prime Minister Hubert Ingraham, who said yesterday that projected foreign direct investment and domestic investment have the potential to turn the economy around.
Ingraham suggested that the country is on the precipice of economic growth. He said the worst of the economic bruising The Bahamas has withstood over the past two and a half years is coming to an end.
“Most important for projections of employment stability and growth are a number of ongoing infrastructure and construction projects, both private and public, which are continuing and in some cases nearing completion, opening opportunities for permanent employment in new premises coming on stream,”said Ingraham as he addressed Rotarians during a luncheon at the British Colonial Hilton.
“We are able now to identify a number of proposed foreign direct investment spending over the next four years and domestic investment spending within the next three years. Together these projects have the potential of unleashing the kind of dynamism within our economy than can bring unemployment to a low level-dare I say the lowest level ever-and create the economic platform which will enable us to pursue the advances in education, health and social and business development and systemic efficiencies that would substantially progress our broad national development.”
In addition to that, Ingraham laid out several other reasons why the government believes that the tide is turning.
He said the unemployment figures are leveling, tourism numbers are improving and non-performing loan numbers are decreasing among other things.
“Now there are distinct signs that the worst is over and that the tide is beginning to turn. For example, that critical barometer of economic well being, foreign direct investment, appears to have reversed its downward slide as the first six-month period in 2010 has posted an increase of 3.5 percent over the corresponding period in 2009,”Ingraham said.
“Another signal of changing fortunes is the significant slowdown in the rate of increase in non-performing loans.”
However, Ingraham added that nothing is more critical to the revival of the Bahamian economy than tourism. So far, he said the tourism product seems to be improving.
“Year on year performance shows significant increases in 2010 over 2009 in six of the nine months through September. Each of the last five months represented significant improvements over the corresponding period in the previous year, in what appears to be a clear trend of tourism revival,”the prime minister said.
“Also, it appears that unemployment has leveled off. NIB statistics suggest that the rate of layoffs has slowed; in fact, some companies have begun hiring again.”
However, as Ingraham pointed out to reporters after his speech, it is unclear how many people are unemployed in The Bahamas today.
The prime minister noted that the Department of Statistics does not have the resources to conduct a census and a labor force survey this year.
Last year, the level of unemployment was placed at above 14 percent with thousands of people listed as discouraged workers–those who are able to work but are so discouraged they have stopped seeking employment because they believe there are no jobs available.
However, Ingraham said the number of people cashing checks in the nation’s banks, buying new cars and shopping are all signs that the rate of unemployment may be positively shifting.
He said that, added with a modest growth in the U.S. economy, strengthens the government’s view that these are early signs of an economic recovery in the works.
“It is without doubt that the Bahamian economy, as indeed the global economy, has gone through a bruising period in the last two and a half years,”Ingraham said.
“It is also now widely accepted that signs of economic recovery are beginning to emerge in many different jurisdictions. And these signs are now beginning to become evident in The Bahamas.”
He also acknowledged that there are threats posed by the continued economic sluggishness in Europe.
Ingraham said the national debt issues of several European countries could threaten the U.S. recovery.
“These are risks to be recognized but not to immobilize us from ensuring our readiness to take fullest advantage of the opportunities that become available to us,”he said.
“It seems to us now that a major opportunity is emerging.”