Central Bank Governor Assesses Matthew Impact

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Governor of The Central Bank of The Bahamas (CBOB) John Rolle said the regulator’s concerns about the Bahamian economy in the wake of Hurricane Matthew are “relieved” for several reasons that relate to tourism, reinsurance inflows and net foreign currency inflows from the remobilization of Baha Mar.
Rolle indicated that the Category 4 storm did not intensely impact the tourism product in New Providence. However, major hotels and resorts in Grand Bahama and Exuma are temporary closed for repairs as a result of severe damage sustained by the storm.

“The disruptions to the tourism plant, which were less concentrated in New Providence and which spared Abaco, are being contained to the low point of the tourist season,” said Rolle.

The Bahamas Hotel and Tourism Association (BHTA) confirmed that most tourist properties throughout The Bahamas suffered relatively minor damage, with the exception of properties in Grand Bahama and Andros.

Rolle pointed out that insured private properties would benefit from reinsurance inflows to help finance the imports of building materials needed for repairs.

President and CEO of Bahamas First Patrick Ward previously explained that from the $400 million estimate of insured claims, $250 million to $300 million of that is going to be paid by international reinsurers that are partners with local insurance companies.

Rolle mentioned that the economy is also receiving some net foreign currency inflows from the Baha Mar claims settlement process.

“There are always concerns in instances of natural disasters about how the Bahamian economy would cope with the adequacy of its foreign reserves. In the present circumstances, the reserves are not under pressure,” he said.

Rolle noted that the bank is participating in a “more comprehensive” economic impact assessment that is being done by the Ministry of Finance.

In addition, the bank would provide a more detailed interim assessment in its upcoming Monthly Economic and Financial Developments Report (MEFD).

The Nassau Guardian
Published: October 24, 2016