By JADE RUSSELL

Tribune Staff Reporter

jrussell@tribunemedia.net

THE Bahamas may be overstating how much money tourists are spending, and the gap could be helping to mask larger economic problems.

That’s the message from a new report by the International Monetary Fund (IMF), which flagged the country’s tourism estimates as potentially inflated and warned that outdated data collection is making it harder to track where money is really coming from or going.

The IMF said current estimates for how much tourists spend, known as “travel credits”, appear too high and are propping up the country’s balance of payments. The concern is that those numbers may not match what’s actually happening on the ground, especially as newer data from the Ministry of Tourism suggests lower revenue than what’s reported in official statistics.

If those numbers are adjusted downward, the result could be a nearly $1bn hole in the national accounts.

The report highlights what it refers to as “Net Errors and Omissions” (NEOs), a category that tracks unexplained discrepancies in international transactions. The report says The NEOs for 2023 could swing to a negative $923m, or around 6.5 percent of GDP, if tourism earnings are revised.

“Estimates for travel credits may be concealing shortfalls in other parts of the balance of payments,” the IMF said.

Most data used to estimate visitor spending is based on old surveys and assumptions. The IMF is urging the government to modernise how it collects that information through updated visitor surveys, better collaboration with the Ministry of Tourism, and more accurate tracking of what visitors actually do and spend when they’re here.

The report also highlights a much broader problem: large amounts of money are flowing into and out of the country through offshore entities — banks, funds, and shell companies — yet none of that activity is currently captured in the country’s official statistics.

In 2023, countries like Luxembourg and Singapore reported receiving over $90bn in investments from The Bahamas. But locally, officials could only explain a small fraction of that amount. The rest likely comes from offshore financial activity that isn’t being properly monitored or reported.

The IMF is calling for an overhaul in how The Bahamas tracks its external finances. It wants the Central Bank to bring offshore entities into national reporting, survey real estate markets to better understand foreign property investment, and update systems that haven’t kept pace with how global money actually moves.

Some progress has already been made. The Central Bank has started collecting more detailed information from local banks and insurance companies. Surveys have also begun for pension funds and investment vehicles. But for the system to be credible, the IMF says, the offshore sector must be fully integrated.