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COVID impacts heavily on Bahamian economy

COVID impacts heavily on Bahamian economy

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NASSAU – A new joint report by the Inter-American Development Bank (IDB) and the United Nations’ Economic Commission for Latin America and the Caribbean (ECLAC) has estimated the total cost of the impacts and effects of COVID-19 on The Bahamas to the tune of US$9.5 billion, with tens of thousands of job losses and long-lasting effects on the country’s tourism sector.

The report, “Assessment of the Effects and Impacts of the COVID-19 Pandemic in The Bahamas,” say that most losses, due to COVID-19 for the period 2020 to 2023, were concentrated between 2020 and 2021, at 84 per cent.

The worst year was 2020, when 48 per cent of losses occurred, the report says.

It says total losses in tourism were estimated at almost US$7.9 billion, largely from the fall in stopover visitors.

According to the report, the economy is expected to return to its pre-pandemic level only by 2024, mainly because of the gradual pace of recovery in the tourism sector and the long-lasting effects of COVID-19 in this sector.

“This estimate represents more than two-and-a-half times the US$3.5 billion estimated cost of damage and losses due to Hurricane Dorian, which devastated parts of Abaco and Grand Bahama in September 2019, just six months before the start of the COVID-19 pandemic,” says the report, adding that the pandemic overlapped and negatively impacted the Hurricane Dorian rebuilding process.

The two disasters are estimated to have cost the country a combined $13.1 billion. In addition, the magnitude of the impacts of COVID-19 highlighted the need for comprehensive Disaster Risk Management and Health Risk Management, among other strategies and instruments, to serve the country better, in areas that range from strengthening disaster risk governance, investing in disaster risk reduction and enhancing disaster preparedness.

The report says aggregated loses in wages of employees and workers are expected to reach US$2.4 billion for 2020 to 2023, or 4.9 percent of gross domestic product (GDP) per year on average.

The impact on employment of these losses is estimated to be around 30 000 jobs, equivalent to 14.7 per cent of the labor force.

The report stated that the pandemic in The Bahamas has affected more women than men, with women accounted for 53 per cent of the total confirmed cases. Around 43 per cent of the cases reported were people between 20 and 39 years old, the report says.

“The COVID-19 pandemic disrupted the world’s economic order and global public health,” said Daniela Carrera-Marquis, IDB Country Representative in Bahamas. “Social distancing measures to curb the spread of the virus created significant challenges for global economic activity. Sectors such as tourism–which depend on the movement of people–virtually shut down.

“The economy of The Bahamas is heavily reliant on tourism, which accounts for half of the country’s Gross Domestic Product,” she added. “The pandemic also highlighted the country’s socio-economic vulnerability as businesses and citizens were hit hard.”

Since the pandemic began, the IDB said it has provided The Bahamas with US$200 000 in technical assistance and US$60 million in loans for projects to reduce COVID-19-caused morbidity and mortality, and to mitigate other indirect impacts of the pandemic on health.

The IDB said these programmes also aim to prepare the country’s health system for future risks.

The Washington-based financial institution said these projects have also focused on designing a strategy to integrate primary health care services to enhance quality care; establish adaptable and climate-resilient clinics to provide primary care services; improve emergency response capacity; and design a roadmap for digitally transforming the health system, including by offering electronic health records and telemedicine services.

The report recommends the implementation of a comprehensive framework for resilient recovery from the COVID-19 pandemic, which will require a combination of structural and non-structural measures to reduce socio-economic, environmental, institutional and human vulnerabilities in the long-term.

While the establishment of priorities, the required resources and the intervention scheduling will depend on The Bahamas Government, the report urges policy planners and stakeholders to leverage ongoing related initiatives, including existing frameworks and the IDB Group’s Country Strategy (2018 to 2022), while considering national priorities regarding gender equality and inclusion in human rights.  (CMC)