By FAY SIMMONS

Tribune Business Reporter

jsimmons@tribunemedia.net

The Bahamas saw a 3.4 percent increase in economic output during 2024 that was largely driven by increased construction, motor vehicle repair and merchant wholesale/retail activity.

In unveiling the advanced gross domestic product (GDP) estimates for 2024, the Bahamas National Statistical Institute (BNSI) reported a 3.7 percent increase in economic output in nominal terms, and a 3.4 percent rise in real terms, compared to 2023. The latter measurement strips out the impact of inflation.

Terah Newbold, the BNSI’s national accounts supervisor, said the wholesale and retail trade, motor vehicle repairs and construction were responsible for the “lion’s share” or real growth.The value added to the economy through the production of goods and services was estimated at $14.1bn.

“According to the 2024 annual estimates, economic activity in The Bahamas increased by 3.7 percent in nominal terms and by 3.4 percent in real terms when compared to 2023. This real growth was evident in a number of industries, led by wholesale and retail trade, motor vehicle repair and the construction industries, which were responsible for the lion’s share,” said Ms Newbold.

“In 2024, the value added created through the production of goods and services in the Bahamian economy was estimated at $15.8bn in nominal prices and $14.1bn in real prices.”

Giving a breakdown of the increase in growth across top industries, Ms Newbold said the wholesale and retail trade and motor vehicle repairs increased by 15 percent, construction increased by 19 percent, information and communication increased by 20 percent and electricity and gas, water supply and sewerage increased by 10 percent compared to 2023.

“Wholesale and retail trade and motor vehicle repairs increased by $206m. This increase is mainly connected with growth in household consumption. Construction increased by $146m. This industry increases as capital investment within the country continued to grow, as evidenced by a rise in imports of construction materials,” said Ms Newbold.

“Information and communication increased by $97m as implementation and increased use of digital technology expanded in the Bahamian economy, and electricity, gas, water supply and sewage increased approximately $64m when compared to 2023. This growth can mainly be attributed to lower fuel costs in 2024.”

Ms Newbold said gross fixed capital formation increased in 2024 due to a 38 percent increase in machinery and transportation equipment, and a 16 percent increase in building and infrastructure. Household consumption also increased by 3 percent, and the export of goods and services, which includes the tourism sector, increased by six percent in 2024.

“Gross capital formation showed an increase in 2024 compared to 2023 of 21 percent. This was led by building an infrastructure sector with an increase of $341m, followed by machinery and transport equipment, which grew by approximately $291m,” said Mrs Newbold.

“Household final consumption expenditure experienced real growth in 2024 of almost $252m. When compared to 2023 exports of goods and services increased by $287m in 2024. This sector includes the contribution of the economy by tourists, which includes both stopover and cruise visitors spending representing the majority of this component.”

The Institute, in unveiling the advance GDP growth estimates for 2024, said: “According to the 2024 annual estimates, economic activity in the Bahamas increased by 3.7 percent in nominal terms and by 3.4 percent in real terms when compared to 2023.

“This real growth was evident in a number of industries, led by wholesale and retail trade, motor vehicle repair and the construction industries, which were responsible for the lion’s share. In 2024, the value added created through the production of goods and services in the Bahamian economy was estimated at $15.8bn in nominal prices and $14.1bn in real prices.”

Explaining how the GDP estimates were derived, the Institute added: “The production approach to GDP, which is derived from the gross value added (GVA) by industry, showed an increase in real growth across most industries. The industries indicating the most substantial increases in 2024 were the following.

“Wholesale, retail trade and motor vehicle repairs increased by $206 (15 percent). This increase is mainly connected to the growth in household consumption. Construction increased by $146m (19 percent). This industry increased as capital investment within the country continued to grow as evidenced by a rise in the imports of construction materials.

“Information and communications increased by $97m (21 percent), as implementation and increased use of digital technology expanded in the Bahamian economy. Electricity and gas, water supply and sewerage increased approximately $64m (18 percent) when compared to 2023. This real growth can be mainly attributed to lower fuel costs in 2024.”

The Institute added that the expenditure approach to GDP, which bases its calculation in final consumption, investments, exports and imports, “indicated a real growth in a number of sectors in 2024. Gross fixed capital formation showed an increase in 2024 compared to 2023 of 21 percent.

“This was led by the building and infrastructure sector, with an increase of $341m (16 percent), followed by machinery and transportation equipment, which grew by approximately $291m (38 percent). Household final consumption expenditure experienced real growth in 2024 of almost $252m (3 percent) when compared to 2023.

“Exports of goods and services increased by $287m (6 percent) in 2024 compared to 2023. This sector includes the contribution to the economy by tourists, which includes both stopover and cruise visitors’ spending and represents the majority of this component.”