The US-based rating agency Moody’s downgraded the sovereign creditworthiness of The Bahamas slashed the country’s long-term issuer and senior unsecured ratings to ‘Ba3’ from ‘Ba2, a day after the general election.
Moody’s, in maintaining a “negative outlook” on The Bahamas, justified the downgrade by saying “the downgrade to Ba3 reflects the significant erosion of The Bahamas’ economic and fiscal strength” occasioned by COVID-19. Moody’s said its baseline expectation assumes tourist arrivals to remain close to 75% of 2019 levels for the remainder of 2021, leaving tourist arrivals at around 50% of 2019 levels.
“Assuming continued recovery in 2022, driven mainly by increased vaccinations and greater comfort with international travel, we expect The Bahamas to have another year of very high economic growth rates,” it said. “We expect GDP growth of 8.0% in 2021 & 7.0% in 2022, after the 14.5% contraction in 2020. We expect stopover arrivals to return to 2019 levels by 2024, while cruise visitors will take longer to recover.” (NG) (JG)