Monthly Economic and Financial Developments, March 2019

Published: Thursday May 2nd, 2019

Overview   

Indications are that the domestic economy maintained its modest pace of growth over the review month of March.  The sustained increase in stopover visitor arrivals supported gains in tourism sector output, while ongoing medium and small-scale foreign investment projects undergirded activity in the construction sector.  In monetary developments, the corresponding robust real sector inflows boosted external reserves; however, liquidity contracted as resources shifted to Government.

Real Sector

Tourism    

Buoyed by robust gains in the key stopover visitor segment, indications are that tourism output continued to strengthen during the review period in both visitor volumes and pricing data.

The latest statistics from the Ministry of Tourism showed a 19.3% increase in total arrivals during January, notably higher than the 4.8% uptick recorded in the prior year. This included accelerated gains in air and sea arrivals of 28.8% and 17.1%, from 7.0% and 4.3%, respectively, in the previous year; and marked strengthening for New Providence and the Family Islands outweighing a cruise-based decline in Grand Bahama.

Moreover, stopover data from The Bahamas Hotel and Tourism Association, revealed that in the two months through February, estimated room revenues improved by 44.0%, on sustained occupancy and pricing advances.

For the month of March, data from the Nassau Airport Development Company Ltd. (NAD) showed that total departures from the country's main airport - net of domestic passengers - grew by 18.8%, albeit lower than the 20.9% expansion in the prior period, when the Easter holidays fell earlier in the year. In terms of the components, the growth in both U.S. and non-U.S. departures slowed to 19.1% and 17.3%, from 20.9% and 21.0%, respectively. An analysis of longer-term trends, showed that during the first quarter, the total number of departures expanded by 22.0%, outstripping the 13.8% uptick recorded in the previous year, as both the U.S and non-U.S departure segments increased by 23.8% and 13.2%, after gains of 13.2% and 16.8%, respectively, over the same period last year.

Healthy trends were also noted in the growing non-hotel based segment of the market, typically characterised by short-term vacation rentals. An analysis of data obtained from AirDNA, showed that the total number of room nights sold firmed by 24.3% to 78,160 in March, as bookings for "entire place" listings rose by 22.8%, and for hotel comparable listings, by 37.3%. Over the first quarter, total room nights booked firmed by 24.7%, underpinned by a 22.4% expansion in "entire place" bookings and a 42.6% rise in the hotel comparable segment. Moreover, all of the significant markets tracked experienced quarterly sales expansions, as room bookings for Exuma firmed by 51.5%, New Providence by 26.9%, Abaco by 21.4%, and Grand Bahama by 2.1%. Further, the average daily rate (ADR) firmed slightly, by 0.7% to $141.97 for hotel comparable listings, while the rate for entire place listings softened by 1.5% to $341.49.

For full text reading, please download the attached documents.