By Fay Simmons

Tribune Business Reporter

jsimmons@tribunemedia.net

THE Bahamas will “remain alert” for potential disruptions from trade disputes between the US and other global partners, Prime Minister Philip Davis said yesterday.

During the mid-year budget presentation, Mr Davis noted tensions between the US, our largest trading partner, and other countries could lead to an increase in the cost of imports and the overall cost of living for Bahamians.

He said in addition to potential supply chain interruptions, any slowdown of the US economy could impact our tourism numbers and dampen exports to that market.

“It is crucial to recognise the impact that the potential trade disruption between major global economies, especially between the US and its trading partners, could have on our nation,” said Mr Davis.

“The US is our largest trading partner, accounting for a significant portion of our imports and exports, particularly in tourism, agriculture, and manufactured goods. Rising trade barriers or tariffs could increase the cost of imports, disrupt supply chains, and negatively affect the cost of living for Bahamian consumers. Moreover, any slowdown in US economic growth, which may result from these tensions, impacting consumer confidence could lead to reduced demand for our exports and a potential decline in tourism numbers.”

Mr Davis said in addition to monitoring the situation, we must diversify trading partners and strengthen regional trade relationships.

“We must remain alert, diversifying our markets, strengthening regional trade relationships, and exploring new trade opportunities to mitigate the potential effects of this global uncertainty on our economy,” said Mr Davis.

During the contribution, Mr Davis also announced his administration plans to secure an investment grade credit rating over the next three years and has engaged Fitch Ratings to assess the nation’s financial standing alongside Moody’s and S&P.

“Reaching this milestone would affirm The Bahamas’ strong creditworthiness and low investment risk, reinforcing our commitment to sound financial management. We intend to implement the necessary reforms to make this vision a reality,” said Mr Davis.

He added that achieving investment grade will allow the country to access the international market without credit enhancements.

“Another aspect of achieving investment grade is to demonstrate that we can access the international market without credit enhancement and under normal conditions. In this regard, we will be tabling a borrowing resolution at the end of this communication for approval to access the international capital market at an appropriate time,” said Mr Davis.

After his contribution, Mr Davis tabled a resolution seeking Parliament’s approval to borrow $300m to fund national development objectives, including infrastructure development projects.