By RODERICK A SIMMS II
RASII@ME.com
“The economy, stupid.” The phrase, famously associated with political strategist James Carville during Bill Clinton’s 1992 US presidential election campaign, was intended to keep the effort focused on the issue that mattered most to voters: The economy. More than three decades later, the expression remains relevant because regardless of the political noise surrounding an administration, people ultimately experience government through their pockets.
For The Bahamas, perhaps we need a similar reminder. We can debate leadership, constitutional reform, decentralisation, crime, Immigration and any number of issues dominating the national conversation, but almost all roads eventually lead back to the economy. Can Bahamians afford to live comfortably? Are wages keeping pace with the cost of living? Can young Bahamians afford homes? Can small businesses survive the cost of electricity, labour, financing and imported goods? Are we creating enough high-paying jobs? And perhaps, most importantly, is economic growth improving the standard of living of the average Bahamian?
On paper, there is good news. The Bahamian economy has strengthened considerably since the COVID-19 pandemic. The International Monetary Fund (IMF) reported real gross domestic product (GDP) growth of 3.4 percent in 2024, and estimated growth of around 2.8 percent in 2025, supported by construction, cruise tourism and the broader recovery of the hospitality sector. Public finances have also improved, with the fiscal deficit narrowing significantly. But economic statistics and economic reality are not always experienced in the same way.
A country can report GDP growth while a household still struggles with groceries. Visitor arrivals can break records while a worker wonders whether his salary will stretch until pay day. Government revenue can increase while a young professional concludes that home ownership remains beyond reach. These realities do not necessarily contradict positive economic statistics; they demonstrate that economic growth and broadly-shared economic well-being are not the same thing. That distinction should be at the heart of the next phase of economic reform in The Bahamas.
Tourism has served
us well but what
comes next?
Tourism remains an extraordinary economic asset. The question is not whether The Bahamas should move away from tourism, but whether we have done enough to build alongside it. The vulnerability is obvious. According to the IMF, stopover visitors generate around 90 percent of tourist spending and around 28 percent of GDP, while roughly 80 percent of tourist inflows originate from the US. That concentration has served us extremely well when the American economy is strong and people are travelling, but COVID-19 demonstrated just how quickly an external shock can expose the vulnerabilities of that model.
Therese Turner-Jones, a Bahamian economist, has raised a similar concern. More recently, discussions involving Ms Turner-Jones have focused on the uncomfortable question of whether strong tourism growth across the Caribbean is translating into greater prosperity for the people who live here. For The Bahamas, this includes the issue of economic leakage. Tourists may spend money in the country, but a large portion of that ultimately exits through imports and other external payments required to sustain the sector.
Ms Turner-Jones has argued that The Bahamas should deepen the linkages between tourism and the rest of the economy, and reduce the import content of the industry so that more of the tourism dollar remains at home. This is an important distinction. Our success cannot simply be measured by how many visitors arrive at Lynden Pindling International Airport (LPIA) or how many cruise passengers walk off a ship. We must also ask how much of what they spend stays here?
Economic diversification, therefore, cannot remain the paragraph that appears in every national speech. We have been talking about agriculture, technology, financial services, the ‘blue economy’, logistics, renewable energy, entrepreneurship and the creative economy for years. At some point, diversification must move from aspiration to measurable contribution to GDP, employment, exports and Bahamian ownership.
This does not mean abandoning the industry we have spent decades building. Quite the opposite. We should extract more value from tourism while simultaneously building industries around and beyond it. The question should increasingly become: How much of every tourism dollar stays in The Bahamas, circulates through Bahamian businesses and ultimately reaches Bahamian households?
That requires stronger linkages between tourism and agriculture, transportation, entertainment, technology, construction, professional services and Bahamian-owned businesses. Economic success cannot simply be measured by how many people arrive on our shores. It must also be measured by what their arrival produces for the people who live here.
Growth must feel
like growth
GDP matters. Fiscal discipline matters. Debt matters. Foreign direct investment (FDI) matters. Tourism arrivals matter. But they are measurements of the economy. They are not, by themselves, the purpose of the economy. The purpose must ultimately be to improve people's lives.
The IMF's latest assessment illustrates the challenge. While the economy has recovered strongly, it expects growth to moderate and eventually converge toward an estimated annual rate of about 1.5 percent over the medium term. Central government debt, although declining, was also around 74 percent of GDP in 2025. These are reminders that post-pandemic recovery should not be confused with having solved our longer-term structural problems.
The Bahamas, therefore, needs to become more deliberate about productivity. How do we produce more value per worker? How do we reduce the cost of doing business? How do we improve education and skills so Bahamians can command higher wages? How do we use technology to make government and businesses more efficient? How do we reduce energy costs? How do we create opportunities across the Family Islands so that economic activity is not disproportionately concentrated in New Providence? These are not separate policy discussions. They are economic policy.
It is still the economy
Governments will be judged on many things. Leadership matters. Integrity matters. Social policy matters. National security matters. But, for the average person trying to build a life, economics has a way of making every other conversation very real.
A stronger economy means little if prosperity becomes increasingly inaccessible to the people generating it. Growth must eventually translate into wages, opportunity, home ownership, entrepreneurship, reliable infrastructure and a reasonable standard of living.
The Bahamas has built one of the Caribbean's most recognisable and successful tourism economies. The next chapter should be about building an economy that is more productive, more diversified, more resilient and, importantly, allows more Bahamians to own a meaningful piece of it.
The National
Development
Plan
This is where the National Development Plan (NDP), Vision 2040, becomes particularly important.
Many of the economic challenges we continue to discuss- our dependence on tourism, limited economic diversification, productivity, Bahamian ownership and the need to create stronger linkages between tourism and the domestic economy - are already contemplated within the NDP.
The plan calls for a more resilient economy, greater entrepreneurship and ownership, and stronger connections between tourism and sectors such as agriculture, culture and local enterprise.
The issue, therefore, is not necessarily that The Bahamas lacks a vision; it is whether we have the discipline to execute it.
The NDP provides an opportunity to move beyond simply counting visitor arrivals and GDP growth, and instead measure whether that growth is creating sustainable jobs, expanding Bahamian ownership, strengthening the Family Islands and ultimately improving the standard of living for Bahamians. Economic reform should not restart with every administration; the NDP should be the thread that connects one government to the next, and keeps the country moving towards a common economic destination.
Conclusion
More than 30 years after James Carville's famous reminder, the lesson remains remarkably simple. Governments can produce impressive statistics, announce record visitor arrivals and celebrate economic growth, but people will ultimately judge the economy from their kitchen tables, their electricity bills, their pay cheques and their ability to build a future. For The Bahamas, the challenge of the next 20 years is not simply to grow. It is to make growth feel like growth. Because, in the end, it is still the economy, stupid.