Report: Bahamas FDI inflows grew 47% to $897 million despite COVID-19

The Bahamas was one of only seven small island developing states (SIDS) that saw increased inflows for foreign direct investment (FDI) during 2020, when flows plunged globally by 35 percent because of the economic crisis caused by the COVID-19 pandemic.

According to the United Nations Commission on Trade and Development (UNCTAD) in its annual World Investment Report 2021, which was released last month, FDI inflows to SIDS fell by 40 percent to $2.6 billion.

However for The Bahamas, Barbados, Comoros, Grenada, the Marshall Islands, Palau, Samoa and São Tomé and Príncipe, there was an increase despite the strains of the pandemic.

“The top five host economies (The Bahamas, Jamaica, Maldives, Barbados and Mauritius) accounted for four-fifths of the total FDI inflows to the group. Inflows to the 10 Caribbean SIDS dropped 36 percent to $1.4 billion. These economies continued to account for more than half the inflows to SIDS,” the report states.

“FDI suffered both in tourism, where only a handful of projects survived the collapse of international travel, and in natural resources. In The Bahamas, inflows grew by 47 percent to $897 million, despite the contraction of the domestic economy and tourism. Reconstruction works following the ravages of Hurricane Dorian in 2019 and investment in ICT services continued in 2020.”

Speaking to the results in the report, Minister of State for Finance Senator Kwasi Thompson said The Bahamas demonstrated the strongest level of FDI receipts among global SIDS, adding that the study highlighted the core message that despite the severe global economic downturn associated with the COVID-19 pandemic, investors maintained a strong level of confidence in the Bahamian economy.

“This is perhaps the strongest indicator of the enduring and sustained confidence that investors have in The Bahamas. It cannot be taken for granted that during these challenging times, investments are not only continuing but increasing. This is evidence that we are headed in the right direction and motivates us to redouble our efforts until full recovery,” he said in a statement.

“As the Bahamian economy rebounds, the government’s articulated Accelerated Bahamas Recovery Plan has placed a renewed focus on prioritizing public and private sector investment. Under this administration, The Bahamas will continue to improve its investment framework, to ensure that domestic and foreign investment inflows will remain healthy and strong over the medium and long term, resulting in more employment opportunities for Bahamians.”

The Ministry of Finance pointed to the FDI inflows to neighboring countries, which experienced some growth but not as much as The Bahamas, with Barbados growing by 22 percent to $262 million and Grenada by 11 percent to $146 million.

Jamaica and St. Kitts & Nevis experienced contractions in FDI receipts of 45 percent and 47 percent respectively.

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source https://thenassauguardian.com/report-bahamas-fdi-inflows-grew-47-to-897-million-despite-covid-19/