MONDAY, JUNE 13, 2016
business@tribunemedia.net
âLittle faithâ on $150m GFS deficit projection By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Oppositionâs deputy leader has âvery little faithâ the Government will hit its projected $150 million deficit target for 20152016, following the $184 million ârevisionâ to the prior fiscal year. K P Turnquest said Prime Minister Perry Christie had performed âa 180 degree turnâ on the GFS deficit outcome for the 2014-2015 fiscal year in his recent Budget speech. He was speaking after Tribune Businessâs assessment of the last two Budget speeches exposed a major, negative revision that resulted in the 2014-2015 fiscal deficit coming in much
$184m revision âswingâ for 20142015 Turnquest: PM did â180 degree turnâ IMF predicts higher deficits than Govât higher than the Governmentâs original projections. Mr Christie, in his May 2015 Budget communication, told Parliament: âI now turn to fiscal performance in the 2014-2015 fiscal year which, I am pleased to report, is now projected to be better than we had expected at the time of the
last Budget Communication. âAs a result, the GFS deficit this fiscal year is now estimated at a level of $197 million, down $89 million from the $286 million forecast. âAs such, the deficit is now expected to amount to 2.3 per cent of GDP, as opposed to the forecasted level of 3.2 per cent.â Mr Christie then touted the projected 2014-2015 fiscal performance as the best for seven years, since the 2007-2008 Budget that predated the global recession. But, fast forward to May 2016, and Mr Christieâs Budget presentation disclosed a negative $184 million âswingâ from the 20142015 outcome projection he See PG B8
Fund paints bleak economic picture Can only see âdownside risksâ for nation Trapped in low growth, high joblessness By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
K P TURNQUEST
Minister in compliance, Ex-Chamber chairman: business ease âbalanceâ âWritingâs on the wallâ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
âDiscussingâ tax enforce changes with Finance
A CABINET minister is discussing with the Ministry of Finance how to âcreate a better balanceâ between its tax compliance crackdown and improving the âease of doing businessâ. Khaalis Rolle told Tribune Business he acted as an âinternal lobbyist on a daily and hourly basisâ within the Government for the private sector, acknowledging business concerns over proposed tax enforcement reforms. The Minister of State for Investments confirmed that he and his Bahamas Investment Authority (BIA) team were having talks with the Ministry of Finance, amid fears that the latterâs initiatives amounted to regulatory âoverkillâ. âWeâre having discussions now with the Ministry of Finance, the investments team, to ensure we create some balance,â Mr Rolle told Tribune Business. âWeâve heard some of the complaints, and the Chamber [of See PG B7
Rolle an âinternal lobbyistâ in Govât for business BIA launches app, databse for investor interact
KHAALIS ROLLE
By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Government has âacted on less than 10 per centâ of private sector recommendations submitted to it two years ago, an exChamber chair adding: âThe writingâs on the wall.â Robert Myers told Tribune Business that the Christie administration appeared to have adopted very little of what the Coalition for Responsible Taxation (CRT) had proposed in the run-up to Value-Added Tax (VAT) implementation, apart from its suggestions on the tax itself. Speaking before the International Monetary Fund (IMF) delivered its latest pessimistic assessment on the Bahamas last week, he said it was âessentialâ for this nation to boost its flagging GDP growth numbers to avoid a currency devaluation. Mr Myers added that See PG B6
IMF: Bahamas growth potential down 50% since millennium turn
Govât acts âon less than 10%â of proposals Greater growth âessentialâ to avoid devalue Poor governance undermines fiscal stability
ROBERT MYERS
THE International Monetary Fund (IMF) says the Bahamasâ economic growth potential has fallen by 50 per cent since the turn of the century, with no sign of any immediate rebound. The Fund painted an extremely bleak picture of the Bahamasâ medium term economic prospects in its latest assessment, finding that the only way this nation can go is likely further down - not up. The assessment, published on Friday, suggested the Bahamasâ ânew normâ is a low-growth economy, plagued by âdouble digitâ unemployment and structural impediments to improved competitiveness. The only âpositiveâ coming from the IMF was its continued praise for the relatively successful Value-Added Tax (VAT) implementation, which it acknowledged had contributed to the Bahamian economyâs contraction. The latest assessment, which concludes the Fundâs 2016 Article IV consultation with the Bahamas, brought its economic growth expectations into line with those given by the Department of Statistics and the Government in the recent 2016-2017 Budget. The IMF could only identify âdownside risksâ facing the Bahamas, and referred to a âsizeable output gapâ to emphasise how this nation continues to perform below its economic growth potential. âStaff estimates point to potential growth between 1 and 1.5 per cent over the medium-term, down from close to 3 per cent at the start of the century,â the Fundâs executive board said. âThis outlook is subject to mainly downside risks, calling for continued fiscal consolidation to rebuild fiscal and external policy buffers and boosting investor confidence, as well as a decisive shift towards implementation of structural reforms to improve competitiveness, See PG B9
âLimited confidenceâ in Budgetary figures By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Bahamas can only have âlimited confidenceâ in the accuracy of the Governmentâs Budget numbers, the Chamber chairman is warning, because they remain âprovisionalâ for so long. Gowon Bowe told Tribune Business that it typically took two to three years before any fiscal yearâs performance was finalised, with the figures subject to considerable gyrations during that period. A prime example is the 2014-2015 fiscal year, whose GFS deficit has undergone a considerable $184 million ânegativeâ revision during the space of 12 months (see other article on Page 1B). The Government in its May 2015 Budget address, which occurred one month before fiscal year-end, that it was on track to achieve a $197 million deficit for the 12-month period - a sum equivalent to 2.3 per cent of gross domestic product (GDP). But, in his 2016-2017 Budget communication, Prime Minister Perry Christie disclosed that the GFS deficit for 2014-2015 had been subject to a major upward revision. The Government is now projecting it will come in at $381 million, equivalent to 4.4 per cent of GDP, and almost $100 million higher than the 2014-2015 target of $286 million or 3.2 per cent
Numbers remain âprovisionalâ for too long Subjected to constant changes post year-end And absence of explanations âworrisomeâ of GDP. Such major swings threaten to undermine confidence in the accuracy See PG B9
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