The staff report for The Bahamas’s 2009 Article IV Consultation examines economic developments and policies. The financial sector, including the offshore sector, accounts for about 20 percent of economic activity. Exchange controls are maintained on capital transactions, narrowing the field of investment opportunities for local wealth, largely to real estate and government debt. Macroeconomic policy has historically been geared to maintaining fiscal sustainability, attracting investment, and supporting the exchange rate peg.
This 1999 Article IV Consultation highlights that real GDP growth for The Bahamas accelerated from less than 1 percent a year in 1994–95 to 4 percent in 1996, but slowed somewhat in 1997–98 as construction work on a second phase of tourism projects led to a decline in the number of available hotel rooms and in tourist arrivals. Following the completion of the expansion projects in November–December 1998, tourist arrivals rose sharply in the first quarter of 1999.