Despite the economic gains from a rebounding tourism sector, Bahamian consumers should expect to see higher prices and more scrutiny in obtaining credit from lending institutions in 2022, Central Bank Governor John Rolle said yesterday during an address at the 31st Bahamas Business Outlook.
“The area in our economy where we’re still not going to see much traction in 2022 and possibly into 2023 is the robust level of credit or bank lending. That is because banks are still on a more drawn-out path in terms of recovery and in terms of the credit environment and there is likely to be some adjustments as the credit bureau starts to have some impact. But longer term the adjustment that we are doing now in the sector will benefit how credit is provided,” he said.
“We also expect when we look at the year ahead that Bahamians will see more of the inflation that is being seen outside of The Bahamas. We are going to see it particularly in the goods and services that we import. We shouldn’t expect that there will be a one-for-one relationship between our inflation and the United States’ inflation, because inflation is really just a reflection of the combination or mix of goods and services that you consume and in the case of The Bahamas, our consumption basket looks different than the Americans.”
In terms of the broader impact of this on the economy, Rolle said it is hoped that as tourism continues to flourish, more Bahamians will gain more working hours to be able to afford this shift in the economy.
“Tourism is where this recovery is happening most, so it means that people are returning to work and as we move through this year we will see also increased work hours for a lot of individuals. That is important because the way we measure unemployment in The Bahamas is, if we just look at who is back on the job it might mislead in terms of in the hotel sector, because hours worked really matter,” he said.
“So, we expect to see continued recovery in terms of hours worked in the hotel sector. It also means that since that is the sector where there has been the greatest amount of setback in terms of dealing with financial matters at the home, et cetera, that that is a part of our population that will improve their relationships with their financial institutions in terms of getting back on even more solid footing as regards to the repayment of debts.”