Bahamians should prepare for a contraction of the economy amid coronavirus fears, Acting Financial Secretary Marlon Johnson said yesterday.
Johnson said the best Bahamians can hope for is that the impact is only short term, and he warned people to save their money.
“What has been forecasted is a flat or slight contraction in the economy,” he said.
“…But I think for us in our modeling, we have to anticipate that given the impact of the coronavirus and given the fact that it may lead to a significant slowdown in tourism, that we may see an even deeper contraction.”
Johnson added, “But the truth is that we simply don’t know right now. The tourism numbers are remaining healthy for the time being. But we have to anticipate that if the coronavirus comes onshore, or certainly if it gets worse in Florida or along the eastern seaboard, we can see a potentially significant contraction.
“Our hope though is…that it will be short term, that it will be a matter of months as opposed to a matter of years. And I think that’s the best-case scenario that we can hope for.”
The travel industry has been particularly hard-hit amid fear over the virus. The U.S. State Department earlier this week discouraged American citizens from traveling on cruise ships.
Johnson said that in light of that, Bahamians must exercise fiscal prudence.
“A lot of persons make their livelihood in the tourism trade,” he said.
“…And if the tourism slows down, then that impacts people’s pocketbook very directly.
“So, I think for all of us, it’s about prudence.
“It’s recognizing that if we are in those direct tourism trades, it is incumbent upon us to save as much money as we can, to be as circumspect in our spending plans until we see what the outcome of this particular event is.”
He added, “The general advice I give to people all the time is if you don’t budget, it’s time to budget.
“…There are a number of things we do that are discretionary.”
COVID-19 originated in Wuhan, China and has since spread to all continents except Antarctica, with major outbreaks in China, South Korea, Iran and Italy.
Currently, non-residents who have visited any of those countries in the past 20 days are not being allowed to enter The Bahamas. Residents who have visited any of those countries in the past 20 days face a two-week quarantine.