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General Macroeconomic Indicators

The importance of banking and finance to the Bahamian economy far exceeds references to absolute size. Ranking second only to tourism, the sector contributes an estimated 15% of the country's Gross Domestic Product (GDP). In 2006, banks and trust companies employed 4,662 persons, and spent $445.0 million as compared to $408.3 million in 2005.

Over the years, two of the major underlying benefits of having a competitive banking and financial sector have been the steady development of human resource infrastructure in tandem with evolving professional and technical service demands, and the promotion of telecommunication advancements, which have kept the sector apace with the rest of the world.

Indicators of the industry's overall contribution in most recent years include:

  1. Total employment and the average annual salary for domestic companies - 1995: 2,903 and $30,141, 1996: 2,980 and $31,074, 1997: 3,050 and $32,820, 1998: 3,178 and $33,296, 1999: 3,203 and $35,270, 2000: 3,270 and $39,112, 2001: 3,371and $37,064, 2002: 3,309 and $39,250, 2003: 3,208 and $40,352, 2004: 3,185 and $39,699, 2005: 3,424 and $41,618.
  2. Total employment and the average annual salary for offshore companies - 1995: 777 and $43,629, 1996: 806 and $43,052, 1997: 892 and $44,180, 1998: 902 and $46,255, 1999: 978 and $48,874,  2000: 1,139  $53,777, 2001: 1,215 and $57,876, 2002: 1,201 and $60,717, 2003: 1,045 and $64,214, 2004: 1,181 and $70,082, 2005: 1,027 and $66,838.
  3. Total employment and the average annual salary for the industry, including both the domestic and offshore sectors - 1995: 3,680 and $32,989, 1996: 3,786 and $33,624, 1997: 3,942 and $35,388, 1998: 4,080 and  $36,161, 1999: 4,181 and $38,452, 2000: 4,409 and $42,901, 2001: 4,586 and $42,578, 2002: 4,511 and    $44,956, 2003: 4,253 and $46,215,    2004: 4,343 and $47,870, 2005: 4,451 and $47,437.
  4. In millions of Bahamian dollars, operational and capital investment expenditure by domestic companies amounted to - 1995: 138.0 and 12.5, 1996: 169.3 and 14.0, 1997: 185.1 and 12.9, 1998: 180.5 and 9.3, 1999: 203.2 and 15.9, 2000: 207.9 and 14.2, 2001: 231.9 and 25.4, 2002: 230.1 and 13.2, 2003: 225.4 and 11.9, 2004: 250.2 and 27.8, 2005: 253.7 and 12.5.
  5. In millions of Bahamian dollars, operational and capital investment expenditure by offshore companies amounted to - 1995: 80.1 and 7.6, 1996: 80.5 and 11.5, 1997: 90.4 and 8.2, 1998: 95.3 and 8.2, 1999: 110.9 
    and 15.2, 2000: 142.7 and 30.3, 2001: 149.4 and 23.3, 2002: 146.8 and 6.1, 2003: 156.8 and 3.6, 2004: 177.6 and 7.2, 2005: 154.6 and 5.1.
  6. In millions of Bahamian dollars, operational and capital investment expenditure for the industry, including both domestic and offshore sectors amounted to - 1995: 218.1 and 20.1, 1996: 249.8 and 25.5, 1997: 275.5 and 21.1, 1998: 275.8 and 17.5, 1999: 314.1 and 31.1, 2000: 350.6 and 44.5, 2001: 381.3 and 48.7, 2002: 376.9 and 19.4, 2003: 382.1 and 15.4, 2004: 424.1 and 34.8, 2005: 408.3 and 17.6.

In the information that follows, real economic growth is measured according to changes in Real GDP. Note that growth rates from 1996 to 2006 are taken from the Department of Statistics National Accounts Report 2006, whereas 2007 and 2008 figures are projected from the IMF World Economic Outlook for April 2007 (Table 6).

 

Year Real GDP
1996 4.20%
1997 5.00%
1998 6.80%
1999 4.00%
2000 1.90%
2001 0.80%
2002 2.3%
2003 1.00%
2004 1.30%
2005 2.50%
2006 3.40%
2007 4.50%
2008 4.00%

 

Gross Domestic Product (GDP) refers to the total value of final goods and services produced in an economy, normally over the period of one year. It is measured in either current prices or constant prices. GDP at current prices or Nominal GDP, as it is called, means that the total value of final goods and services is measured at the prevailing price level in that period. Correspondingly, GDP at constant prices or Real GDP, means that the total value of final goods and services is measured at a price level from which the element of inflation would have been removed. This action enables the determination that an increase(decrease) in an economy's production from year-to-year would have been due to a direct increase(decrease) in production, and not influenced by price increases(decreases). On this basis, economic growth is measured as the percent change in Real GDP, since this constant price measurement, in effect, indicates the 'real' or actual production in an economy.