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Bahamas: Central Bank, Ministry of Finance dismiss debt default speculation

NASSAU, BAHAMAS — Both the Central Bank and the Ministry of Finance have strongly denounced speculation that The Bahamas will likely default on its sovereign debt obligation, with the latter describing the claims as “unreasonably alarmist”.

Caribbean economist Marla Dukharan has predicted The Bahamas will default on its sovereign debt next year.

Dukharan while addressing Royal Fidelity’s Investor Forum 2020, noted that the default could mean The Bahamas would enter an International Monetary Fund (IMF) program.

Back in May, Dukharan, a former Royal Bank of Canada top regional economist made similar remarks during a webinar with Cayman Islands financial analysts, predicting that this nation will be in an International Monetary Fund (IMF) adjustment programme by 2021 due to a “balance of payments crisis”.

Responding to the claims, Central Bank Governor John Rolle said: “It is important to preface my remarks by stating that The Bahamas will have to do more to reduce the public debt burden in the medium-term. The debt burden leaves The Bahamas exposed to increased hardships from severe hurricanes and other shocks, as the sovereign will continue to need more flexibility and space to repair infrastructure, give relief to private businesses and provide social safety net assistance, after such setbacks.

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