By YOURI KEMP
FORMER Democratic National Alliance leader Branville McCartney believes the Bahamas has a tremendous opportunity to build better than ever in the wake of Hurricane Dorian, which decimated parts of Abaco and Grand Bahama last month.
Mr McCartney’s comment to Tribune Business yesterday followed Standard & Poor’s latest assessment of the country post-Dorian. The rating agency said early signs suggest the country is well positioned to handle the fallout from the storm. The hurricane’s long-term effect on credit quality could be limited, the agency said, particularly if the government responds in a timely manner to various challenges.
Reacting yesterday, Mr McCartney said: “I think with regard to S&P’s positive report that it is good that we are in a good position to handle the fallout from Hurricane Dorian. I think we ought to use this as something where we are able to rebuild and to restructure our country better, particularly in those two islands.
“This ought to be used for us to look at the economic model of those two islands, and rebuild them to accommodate for the future. Although it’s going to be difficult in the meantime, we have to look at the silver lining for us to rebuild into a first world status. The government should recognise we can’t do this on our own. We need to look internationally in order to get the best advice and look towards the future to carve those islands out in a way that would ensure that they would be economically beneficial and viable on the whole. The government has a tremendous task at hand with regard to having the insight and vision and pure will to make the changes needed. But I have no doubt that we can rebound and rebuild stronger.”
Among the reasons S&P believes the long-term effects of Dorian on the country’s credit quality could be limited is that Abaco and Grand Bahama attract only 20 percent of tourists.
“Other destinations within the country, including Nassau, the capital and economic centre, were unaffected,” the agency said.
“Furthermore, before the hurricane, the country had been on track to achieve good GDP growth in 2019, slightly exceeding our forecast. The government also recently reported a relatively strong fiscal performance in 2019 (year ended June 30). Based on the information currently available, the timing and location of the hurricane’s impact, and the country’s relatively strong economic and fiscal performance year to date, it is possible that Dorian may not lead to a meaningful deterioration in The Bahamas’ economy, fiscal performance, debt burden, and external assessment.
“Nevertheless, this event highlights the importance of considering environmental factors in our analysis of The Bahamas, given its location in the Atlantic hurricane belt, and the large geographic dispersion of its 700 islands over almost 14,000 square kilometers. In the past five years, The Bahamas has been affected by at least four other serious hurricanes. We believe this elevated environmental risk has contributed to below-average growth for The Bahamas, when compared with peers with similar GDP per capita. The Bahamas has taken steps to mitigate the risks related to increasingly frequent climate disasters by strengthening its public finances, planning for these events, and obtaining insurance. Despite these efforts, vulnerability to natural disasters continues to affect the country’s creditworthiness,” S&P said.