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Bahamian Politics Last Updated: Feb 13, 2017 - 1:45:37 AM


The Bahamas at Junk Bond Status: The Prime Minister must address the Nation
By Youri Kemp, DNA Spokesperson for the Economy and Finance
Dec 21, 2016 - 4:25:05 PM

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It is with great sadness that we found out that The Bahamas has been downgraded to Junk Bond status by the ratings Agency Standards and Poor’s, the third one since this administration took office in 2012.

The now BB+ rating that we stand at as a nation affirms to us that we are in a dangerous time economically, and this current administration does not have the tools needed to address our financial and economic problems.

What has to happen now is that Prime Minister Christie, who is also the Minister for Finance, needs to address the nation in a comprehensive and meaningful way with regard to his financial administration and allay any additional fears in our economy that investors and Bahamians may have as a result of this downgrade.

The Democratic National Alliance was at the core of this ratings exercise, after having met with analysts from S&P back in July of this year and found out first-hand what they really felt about our country’s financial stability, our economic viability and what they felt the government was and should be doing about it.

We in the DNA were also shocked at the lack of participation from members of the then Opposition Party and the lack of attention being paid to such a critical assessment, as it was a forewarning of what the ratings would be at the end of this year, 2016.

At the core of this ratings’ downgrade by S&P’s, they made mention of the slower than normal rate at which the fiscal consolidation has taken place, something in which the DNA has highlighted on several occasions and have urged the government to be more forceful with regard to their consolidation efforts in addition to being more truthful on how our VAT is collected and spent. In essence, stop playing statistical shell games with our economic indicators and commit meaningfully to true consolidation and a reversal in the out of control spending.

Even as we discuss this and S&P have gave their assessment, the projected expenditure for this fiscal year is some $300 million plus more than the previous budget year, and set to remain at that level and even more when we consider the trends of previous years that the government has over-shot their projections by millions.

We need better than this. We need to get our country back to the path of growth and in the oncoming weeks the DNA will be carrying out our message of reforms and economic expansion for all Bahamians.
We simply cannot allow over $600 million in VAT receipts to be collected by the Treasury while we are deeper in debt and out deficit percentage is some 35% higher than projected by the Minister for Finance in his last budget communication.

We also simply cannot stand by and hear our economic growth forecast revised downward to .03%, from the already negligible forecast of 1.2% for the next year, 2017.

The DNA urges, yet again, for The Minister for Finance to address the nation with regard to our economic viability and performance. We also urge for this administration to undertake wider discussions and dialogue with other opposition members and civil society.

Also, it is important to note that Moody’s has their assessment to give as well and if it follows up as with S&P then we are in for dangerous and perilous times for 2017. Times in which will be unbearable for Bahamians.

We also urge that this administration become more transparent and adopt the policies set out by the DNA on financial transparency and accountability. We urge them to stop the wasteful spending and do the right thing!

Youri Kemp
DNA Candidate for Garden Hills
DNA Spokesperson for the Economy and Finance

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