Bahamas III: Economic power, reliable partnerships

Aired March 2008

Offering year-round sunshine and stunningly beautiful beaches, the Bahamas stretches over 100,000 square miles of some of the clearest water in the world. Made up of about 700 islands, the archipelago has been classified as an upper middle-income developing country, and ranked as one of the wealthiest nations in the Caribbean region.

The country has about 300,000 English-speaking citizens, most of whom live on the islands of New Providence, home of the capital Nassau, and Grand Bahama Island, home of Freeport.

In recent elections, the physically conservative government of Prime Minister Hubert Ingraham came to power. He pledged/ to bring good governance and accountability to office, together with policies spurring even higher levels of growth for greater numbers of Bahamians.

Today, the nation's economy relies heavily on the tourism and financial services sectors to generate foreign-exchange earnings.

Robust domestic demand and the new government's economically conservative policies are expected to keep the economy moving forward, resulting in an annual growth of at least 4%.

Ideally located at the crossroads of the Americas, the Bahamas attracts numerous international companies, who are drawn to the nation's political stability, economic diversity, as well as tax-free business opportunities.

With close proximity to the United States, strong ties have developed between the 2 neighbours over the years.

Well aware that location alone is not enough to lure potential investments, successive business-friendly governments welcome investors by offering state-of-the-art infrastructure, streamlined government bureaucracy and favourable tax policies.

Investors are also attracted to the stability of the economy, which is steadied by the solid value of the Bahamian dollar. The currency has been pegged to the US dollar on a 1:1 ratio for the last 35 years. US dollars and Bahamian dollars are used interchangeably throughout the island chain.

A series of investment incentives provide relief from customs duties on approved raw materials, equipment, and building supplies, as well as allowing exemptions from business licenses and real estate property taxes for up to 20 years, thus further encouraging foreign investors to pick the Bahamas as a location.

The large, diverse and highly-skilled professional community of accountants, international bankers, trustees, and investment specialists ensure that any foreign venture into the islands will be well-supported.

FINANCIAL SERVICES

The Bahamas has been providing banking and trust services to international financial community since the 1930’s. With its historic commitment to providing top quality service to high net-worth individuals, the Bahamas has emerged as one of the world’s foremost private wealth management centres.

The rigid, self-regulatory code of conduct of the Association of International Banks and Trust Companies also deters the use of financial operations for criminal activities and upholds the principles of bank secrecy.

Private banking, portfolio management, and mutual fund administration have gained in importance in recent years, reinforcing the international community's recognition of the Bahamas as a safe repository of the financial assets of both individuals and corporations.

In its role as a centre of world banking activities, the Bahamas emphasizes the quality and international reputation of its financial institutions. Today, the country boasts over 400 banks from more than 30 different countries, including many of the world's largest and most prestigious financial institutions.

Licensees also include major players in the offshore banking and trust community. The nation boasts over 40 years of steady growth and experience in this very active and lucrative area.

The financial services sector is expected to continue to grow and to play an even larger role in the country’s economy in the future.

INFRASTRUCTURE

The government of the Bahamas has long made infrastructure a top priority in its efforts to attract continued foreign investment. Today, the Bahamas boasts one of the best infrastructures in the Caribbean region.

The tens of millions of dollars spent by successive administrations on the country's infrastructure have resulted in a modern transportation system. The road and highway system in the Bahamas is well developed and is constantly being upgraded.

The islands also boast six major airports, which are served by various international airlines. The Nassau airport, the Caribbean's fourth busiest, handles 50,000 flights per year and receives over 3 million passengers annually.

23 seaports dot the Bahamas, allowing for regular shipping connections to the Americas and Europe.

The deep-water shipping ports in Nassau and Freeport are major international transhipment centres, servicing both tourism and commerce.

The country has established a world-class telecommunications infrastructure. For over 100 years, the Bahamas Telecommunications Company, or BTC, has been the primary service provider for the islands.

The infrastructures and place, you can be connected in a very, very short time to the rest of the world, so you’ll have continuity in terms of business as well as we’ve got a network that is very robust.

State-of-the-art services in the country include international telex, cellular radiotelephone, facsimile, automatic radio paging, and private line services. Instantaneous direct international links are provided through a 100% digital switching system.

With the continued dedication of the government towards further improving the already high standards of infrastructure available on the islands, residents and international companies can continue to count on world-class facilities.

TOURISM

The Bahamas has long supported a thriving tourism sector, and tourism remains the country's top industry.

Supporting nearly half the labour force and producing 70% of the government tax revenue, tourism is expected to remain the dominant industry of the Bahamas for the foreseeable future.

Home to some of the world's most beautiful beaches, the islands offer visitors a chance to relax as well as to take part in sporting activities.

In addition, with more than 5% of the planet's reef mass, there are inexhaustible pleasures and challenges for snorkelers and divers.

In the bustling capital of the Bahamas archipelago, Nassau, many old buildings are preserved till today. The famous Straw Market is one of the largest in the world. Here, you'll find an array of handmade hats and baskets along with woodcarvings.

Several multi-billion-dollar anchor investments have led the Bahamas to being ranked among the world's five-star venues for tourism. Recent mega-projects include the Atlantis Resort on Paradise Island. Connected to the city of Nassau by two 600-foot bridges, the island has many amenities, which cater to tourist interests.

There are plans to further develop other islands. The island of Grand Bahama – the country's fourth largest island, just off southeast Florida – is also a priority for the new administration. It hopes to develop a major cruise ship port in Freeport within the next 24 months, turning the town into a major cruise ship destination.

Exemptions from property tax and customs duty for companies investing in hotel and resort development have further encouraged the construction of new hotels and stimulated the renovation of existing ones.

Visitors can also enjoy the wide variety of flora and fauna found in the country. From trained flamingos to family-friendly dolphins, the various animal reserves offer a wonderful day's outing.

Most of the islands also offer excellent opportunities for eco-tourism development. Low-impact, environmentally-sensitive resort-developers interested in providing nature theme vacation destinations will find a promising investment environment.