In the wake of another major resort delaying its reopening and the country’s borders being closed again to US commercial flights, Deputy Prime Minister and Minister of Finance Peter Turnquest yesterday reassured that while these new developments ultimately mean less tourist spend, they “won’t hurt us tremendously”.
The deputy prime minister cautioned, however, that the country is only on safe footing for a limited amount of time, adding that if things don’t improve by the end of the year, more austerity measures may need to be considered.
“The good news is we had not projected much tourism business up through the end of October. Obviously, we had hoped that there would be some trickle to support. But we didn’t anticipate anything significant up until then. So, from that perspective, it doesn’t hurt us tremendously,” Turnquest told Guardian Business yesterday.
“Having said that, of course, the level of social assistance that has been necessary, has been running a little bit ahead of where we anticipated it to be. So, that being said, on balance, we are not in the best of places in terms of where we would want to be. In relative terms, we are more or less on pace for where we anticipated being, but we’re not where we want to be.”
Visitor arrivals into Lynden Pindling International Airport (LPIA) were less than 6,000 – significantly less than typical numbers, which can be in excess of 200,000 per month during the busy season – since the country’s borders reopened to international commercial flights on July 1.
However, with the commercial flights from the country’s number one source market ending Wednesday until the recent uptick in COVID-19 subsides, the little tourism revenue the country was poised to collect is expected to diminish in the foreseeable future.
“We are continuously monitoring and drafting contingency plans for what may happen in the event that things do not improve. But again, as I say, we’re still within our envelope in terms of where we thought we would be. So, it doesn’t cause us to need, at this particular point, dramatic changes in what we have been doing,” Turnquest said when asked whether the government is seeking to cut back on spending given the new developments.
“If we get down to the late-October time frame and things are still uncertain or as they are today, then we’re going to have to make changes, most likely coming into the new year.”
Turnquest said in the meantime, the government’s fiscal priority remains supporting Bahamians during these uncertain and unstable economic times.
“Again, remember the principle, in an economy like this where the private sector is obviously very challenged, the government does have an obligation to step in and provide some stability and some support. So, for us to stop spending now even though things are very tenuous, it would just add disaster to an already bad situation. So, as uncomfortable as it is for those of us who manage the budget, this is one of those times where the government has to step in and provide some level of stability and support for the economy and for individuals, so that the bottom does not completely fall out,” he said.
“The careful thing for us is to make sure that we spend that money on sensible things. So, for instance, infrastructure works that provide improved and needed infrastructure or upgraded infrastructure is a reasonable investment. When we talk about some of the softer investments, we have to consider some of those a little more carefully because they are temporary at best. So, it’s really about how you spend that money.”