IMF Praises Reform Progress In The Bahamas
by Mike Godfrey, Lowtax.net, Washington
16 June, 2015
The International Monetary Fund (IMF) has concluded its Article IV consultation with the Bahamas, reporting that the economy is gradually recovering but stressing the need for continued economic diversification and tax reforms.
The IMF commended the Bahamian authorities for the substantial progress on fiscal consolidation and for the successful introduction of the value-added tax. However, it warned that the outlook remains challenging.
In 2014, real gross domestic product (GDP) expanded by an estimated one percent but growth remains well below pre-global crisis levels.
The fiscal deficit in 2013/14 is estimated to have narrowed to 3.3 percent of GDP from 5.4 percent in FY2012/13.
Government revenues were lower than budgeted, but a substantial reduction in spending resulted in a fiscal deficit that was below the budget target.
The IMF welcomed continued progress on financial sector reform, including the planned introduction of a new credit bureau. It noted that the financial sector and the banking sector remain well capitalized and liquid, and it said that efforts to further strengthen financial sector regulation and supervision should continue.
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