{
  "title": "The Bahamas: Staff Report for the 2015 Article IV Consultation",
  "publication": "IMF Staff Country Reports, July 27, 2015",
  "sourceUrl": "https://www.imf.org/en/publications/cr/issues/2016/12/31/the-bahamas-staff-report-for-the-2015-article-iv-consultation-43125",
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  "summary": "Context. Economic activity strengthened somewhat in 2014 while the external current account deficit worsened primarily as a result of Baha Mar construction-related imports.",
  "publishDate": "2015-07-27",
  "series": "IMF Staff Country Reports",
  "sections": [
    {
      "heading": "Context and recent developments",
      "content": "- Economic activity strengthened somewhat in 2014.\n- The external current account deficit worsened primarily as a result of Baha Mar construction-related imports.\n- The authorities continued to make substantial progress on fiscal consolidation with successful VAT implementation in January 2015 setting the stage for continued improvements in the fiscal position.\n- Lower oil prices helped keep inflation anchored in 2014.\n- Notwithstanding the capital flow management (CFM) regime, international reserves remain low.\n- The pre-crisis credit boom has left the banking system with an overhang of non-performing loans, which will likely continue to generate headwinds for the economy.\n- Despite the non-performing loan overhang, the banking system remains very well capitalized and liquid."
    },
    {
      "heading": "Key findings and outlook",
      "content": "- Growth outlook remains well below pre-global crisis levels despite the U.S. recovery and the imminent opening of the Baha Mar resort.\n- Rebuilding fiscal and external buffers will be essential for sustaining macroeconomic stability.\n- The fixed exchange rate peg constrains monetary policy, leaving fiscal policy as the main instrument for macroeconomic stabilization."
    },
    {
      "heading": "Policy recommendations",
      "content": "- Reigniting strong and inclusive medium-term growth:\n  - Implement structural reforms to address longstanding competitiveness issues, including labor market impediments to growth.\n  - Pursue energy sector reforms to substantially lower energy costs, boost productivity, and facilitate economic diversification in the medium term.\n  - Develop a diversification strategy that explores increasing value added in the tourism sector, including through deepening linkages with agriculture.\n- Rebuilding fiscal and external buffers:\n  - Steadfast implementation of the VAT (implemented January 2015) and expenditure rationalization within a medium-term budgetary framework.\n  - Advance public enterprise reforms to help rebuild fiscal buffers and support international reserves.\n- Preserving financial sector stability:\n  - Put in place measures to resolve the debt overhang from non-performing loans.\n  - Further strengthen the regulatory and supervisory framework for the banking system."
    },
    {
      "heading": "Subject focus and keywords (as provided)",
      "content": "- Subjects: Commercial banks, Credit, Financial institutions, Fiscal consolidation, Fiscal policy, International reserves, Money, Public debt, Taxes, Value-added tax\n- Keywords: banking system, Caribbean, CARTAC mission, central bank, Commercial banks, CR, Credit, credit growth, debt GDP ratio, deficit, Fiscal consolidation, GDP, Global, IDB participation, ISCR, Potential GDP growth, Value-added tax\n\nSource: The Bahamas: Staff Report for the 2015 Article IV Consultation, IMF Staff Country Reports 2015, No. 2015/203 (Pages: 64; DOI: https://doi.org/10.5089/9781513502649.002).\n\n---\n\n Content in this bundle\n\n- cr15203\n  - cr15203 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - cr15203 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/cr/issues/2016/12/31/the-bahamas-staff-report-for-the-2015-article-iv-consultation-43125"
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    "Published: July 27, 2015",
    "Series: IMF Staff Country Reports",
    "DOI: https://doi.org/10.5089/9781513502649.002",
    "Economic activity strengthened somewhat in 2014.",
    "The external current account deficit worsened primarily as a result of Baha Mar construction-related imports.",
    "The authorities continued to make substantial progress on fiscal consolidation with successful VAT implementation in January 2015 setting the stage for continued improvements in the fiscal position.",
    "Lower oil prices helped keep inflation anchored in 2014.",
    "Notwithstanding the capital flow management (CFM) regime, international reserves remain low.",
    "The pre-crisis credit boom has left the banking system with an overhang of non-performing loans, which will likely continue to generate headwinds for the economy.",
    "Despite the non-performing loan overhang, the banking system remains very well capitalized and liquid.",
    "Growth outlook remains well below pre-global crisis levels despite the U.S. recovery and the imminent opening of the Baha Mar resort.",
    "Rebuilding fiscal and external buffers will be essential for sustaining macroeconomic stability.",
    "The fixed exchange rate peg constrains monetary policy, leaving fiscal policy as the main instrument for macroeconomic stabilization.",
    "Reigniting strong and inclusive medium-term growth:",
    "Rebuilding fiscal and external buffers:",
    "Preserving financial sector stability:",
    "Subjects: Commercial banks, Credit, Financial institutions, Fiscal consolidation, Fiscal policy, International reserves, Money, Public debt, Taxes, Value-added tax",
    "Keywords: banking system, Caribbean, CARTAC mission, central bank, Commercial banks, CR, Credit, credit growth, debt GDP ratio, deficit, Fiscal consolidation, GDP, Global, IDB participation, ISCR, Potential GDP growth, Value-added tax",
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