## IMF Executive Board Concludes 2025 Article IV Consultation with The Bahamas _IMF News, February 5, 2026_ ## Source details **Canonical URL:** [IMF Executive Board Concludes 2025 Article IV Consultation with The Bahamas](https://www.imf.org/en/news/articles/2026/02/04/pr-26031-the-bahamas-imf-executive-board-concludes-2025-article-iv-consultation) ## Other formats - [Markdown version](/en/news/articles/2026/02/04/pr-26031-the-bahamas-imf-executive-board-concludes-2025-article-iv-consultation/index.md) - [Structured JSON version](/en/news/articles/2026/02/04/pr-26031-the-bahamas-imf-executive-board-concludes-2025-article-iv-consultation/index.json) - [Bundle manifest](/en/news/articles/2026/02/04/pr-26031-the-bahamas-imf-executive-board-concludes-2025-article-iv-consultation/bundle-manifest.json) ## Bibliographic details - Published: February 5, 2026 --- ### Overview - The Executive Board completed the 2025 Article IV consultation with The Bahamas and endorsed the staff appraisal without a meeting, on a lapse-of-time basis. - The authorities consented to publication of the Staff Report prepared for this consultation. - Date of press release: February 5, 2026. Press Release No. 26/031. ### Recent Economic Performance - Real GDP expanded by 3.4 percent in 2024. - Growth remained resilient in the first half of 2025, supported by construction and cruise tourism. - Unemployment rate: 9.3 percent in the second quarter of 2025. - Inflation decelerated to 1.3 percent in July 2025, partly reflecting lower global energy prices. - Fiscal outcomes in FY2024/25: primary balance remained in surplus and the fiscal deficit narrowed to 0.5 percent of GDP. - Central government debt remains elevated, at around 74 percent of GDP. ### Outlook and Risks - Growth projections: - Growth is expected to be around 2.8 percent in 2025. - Growth is expected to gradually slow toward 1½ percent (the assessed potential growth rate) over the medium term. - Inflation and external sector: - Headline inflation is projected to settle at around 2 percent. - The current account deficit is projected to narrow to about 6 percent of GDP over the medium term. - Risks to the outlook: - Downside: potential global slowdown affecting tourism; natural disasters. - Upside: greater-than-expected effects of public and private infrastructure projects linked to tourism and the energy sector reform. ### Executive Board Assessment — Key Messages - Strengths and priorities: - Robust post-pandemic tourism has driven growth and fiscal revenues. - Actions taken to improve public finances and enhance disaster risk management. - Ongoing electricity sector reform, increased tourism capacity, and investment in climate resilience are critical to reduce fiscal vulnerabilities and foster sustained growth. - Growth path and risks: - Growth in 2025 supported by construction and cruise tourism; expected to converge to 1½ percent over the medium term. - Risks broadly balanced: downside (global slowdown, natural disasters); upside (infrastructure and electricity reform benefits). - Fiscal policy and debt target: - Achieving the authorities’ medium-term target for central government debt (50 percent of GDP) requires additional measures. - Recommended measures include introducing corporate and personal income taxes, rationalizing tax expenditures, raising the standard VAT rate, and reducing transfers to SOEs. - Prioritize revenue-enhancing and expenditure-optimizing measures to create space for priority investments, such as education and resilient infrastructure. - Fiscal institutions and fiscal risks: - Immediate priority: improve fiscal reporting and enhance institutional framework for PPPs. - Accurately assess and mitigate fiscal risks arising from SOEs. - Supplement planned civil service pension reform with more holistic changes to address actuarial imbalances. - Advance adoption of an accrual-based accounting system for the budget to improve fiscal transparency. - Continue efforts to reduce debt rollover risks. - Financial sector: - Systemic financial stability risks are moderate. - As bank credit to the private sector increases, safeguard banks’ resilience and monitor banks’ exposure to the sovereign. - Strengthen oversight of nonbanks and close data gaps; operationalize real estate price indices. - Planned legal reforms to improve resolution frameworks and safety nets; reduce the ceiling on central bank advances to the government to support the exchange rate peg. - Maintain efforts to implement the 2024 DARE Act; enhance risk-based AML/CFT supervision and promote financial inclusion. - Structural and resilience policies: - Raise productivity and implement fiscal consolidation to narrow external imbalances. - Ongoing hotel and airport infrastructure projects can alleviate tourism capacity constraints. - Reduce vulnerable employment and informality by cutting red tape, strengthening education, and expanding training and upskilling. - Trade diversification and greater product market competition can strengthen resilience and reduce import costs. - Continue energy sector reform to improve cost and reliability of electricity. - Enhance disaster risk management and invest in climate resilience. - Address housing affordability by investing in social housing and refining rental market regulations. ### Fiscal and Macro-Financial Recommendations (Selected) - Introduce corporate and personal income taxes. - Rationalize tax expenditures. - Raise the standard VAT rate. - Reduce transfers to state-owned enterprises (SOEs). - Improve fiscal reporting and PPP institutional framework. - Assess and mitigate SOE-related fiscal risks. - Supplement civil service pension reform with broader actuarial solutions. - Adopt accrual-based budget accounting. - Reduce debt rollover risks. - Strengthen oversight of nonbanks and close financial data gaps. - Implement planned legal reforms for resolution frameworks and safety nets. - Reduce the ceiling on central bank advances to government; implement the 2024 DARE Act. - Enhance risk-based AML/CFT supervision and promote financial inclusion. - Invest in education, resilient infrastructure, social housing, and training/upskilling. ### Key Indicators (Selected from Table 1) - Real GDP (annual % change): 2023: 3.0; 2024: 3.4; 2025: 2.8; 2026: 2.2; 2027: 1.9; 2028: 1.8; 2029: 1.6; 2030: 1.5. - Unemployment rate (%): 2023: 10.2; 2024: 8.4; 2025: 9.5; 2026: 9.4; 2027: 9.2; 2028: 9.0. - Current account balance (% of GDP): 2023: -7.0; 2024: -7.6; 2025: -7.8; 2026: -7.5; 2027: -7.3; 2028: -6.8; 2029: -6.5; 2030: -6.1. - CPI inflation (%, period average): 2023: 3.1; 2024: 0.4; 2025: 0.6; 2026: 1.2; 2027: 2.0. - CPI inflation (%, end of period): 2023: 0.0; 2024: 0.7. - Fiscal overall balance (% of GDP) 1/: 2023: -3.7; 2024: -1.2; 2025: -0.5; 2026: -0.4; 2027: -0.3; 2028: 0.1; 2029: 0.2. - Fiscal primary balance (% of GDP) 1/: 2023: 0.3; 2024: 2.7; 2025: 3.7; 2026: 3.6; 2027: 3.8. - Central government debt (% of GDP) 1/: 2023: 78.3; 2024: 73.8; 2025: 74.1; 2026: 72.7; 2027: 71.4; 2028: 69.9; 2029: 67.9; 2030: 65.8. - Note: 1/ Fiscal year (FY, July 1 - June 30). *Press Release No. 26/031, IMF, February 5, 2026.* --- ## References - [The Bahamas and the IMF](http://www.imf.org/external/country/BHS/index.htm) - [IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance) - [Press Releases](https://www.imf.org/en/news/searchnews) - [PRESS CENTER](http://presscenter.imf.org/) - [www.imf.org/Bahamas](http://www.imf.org/Bahamas) - [https://www.imf.org/en/home](https://www.imf.org/en/home) _Source: https://www.imf.org/en/news/articles/2026/02/04/pr-26031-the-bahamas-imf-executive-board-concludes-2025-article-iv-consultation_