Monthly Economic and Financial Developments, July 2010

Published: Tuesday August 31st, 2010

Domestic economic activity remained relatively subdued over the review month, as continued signs of stabilisation in tourism activity––although still significantly below pre-crisis levels—occurred alongside broad-based weakness in domestic demand. Consumer price inflation, however, remained relatively benign over the first five months of the year, while monetary conditions featured a modest expansion in bank liquidity and a contraction in external reserves.

Initial data suggests that tourism sector output expanded modestly over the first half of the year as incentive programmes, alongside the soft economic recovery in the main source markets, supported improvements in the key stopover visitor segment. Total arrivals advanced by 10.7%, extending last year’s 2.9% growth, reflecting a 13.8% rise in sea passengers and a 3.0% revival in the air component. Disaggregated by port of entry, arrivals to New Providence grew by 5.0%, occasioned by a 6.2% increase in sea traffic and a more modest 2.8% firming in air passengers. In addition, the rerouting of one cruise line along with increased visits by other carriers, buoyed sea visitors to Grand Bahama by 52.7%, which outstripped a 7.1% reduction in air visitors, for an overall 37.8% advance in that market. Similarly, visitors to the Family Islands expanded by 11.4%, based on double-digit gains in both air (10.9%) and sea (11.5%) traffic.

Hotel performance indicators for the January to July period showed total revenues from a sample of hotels in Nassau and Paradise Island firming by 7.6% to $250.6 million, in contrast to the year-earlier 17.3% plunge. The outcome benefitted from an upturn in average occupancy by 3.0 percentage points to 69.2%, and a more modest advance in average daily room rates of 2.7% to $244.21.

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