Background: Since attaining independence from the United Kingdom in 1973, The Bahamas have prospered through tourism and international banking and investment management. By the early 1980s, the islands had become a major center for drug trafficking, particularly shipments to the United States.
Government type: constitutional parliamentary democracy
Currency: 1 Bahamian dollar (B$) = 100 cents
Geography of Bahamas
Location: Caribbean, chain of islands in the North Atlantic Ocean, southeast of Florida
Geographic coordinates: 24 15 N, 76 00 W
total: 13,940 sq. km
land: 10,070 sq. km
water: 3,870 sq. km
Land boundaries: 0 km
Coastline: 3,542 km
continental shelf: 200-m depth or to the depth of exploitation
exclusive economic zone: 200 nm
territorial sea: 12 nm
Climate: tropical marine; moderated by warm waters of Gulf Stream
Terrain: long, flat coral formations with some low rounded hills
lowest point: Atlantic Ocean 0 m
highest point: Mount Alvernia, on Cat Island 63 m
Natural resources: salt, aragonite, timber
arable land: 1%
permanent crops: 0%
permanent pastures: 0%
forests and woodland: 32%
other: 67% (1993 est.)
Natural hazards: hurricanes and other tropical storms that cause extensive flood and wind damage
Environment – current issues: coral reef decay; solid waste disposal
Environment – international agreements:
party to: Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Hazardous Wastes, Law of the Sea, Nuclear Test Ban, Ozone Layer Protection, Ship Pollution, Wetlands
signed, but not ratified: none of the selected agreements
Geography – note: strategic location adjacent to US and Cuba; extensive island chain
People of Bahamas
Eighty-five percent of the Bahamian population is of African heritage. About two-thirds of the population reside on New Providence Island (the location of Nassau). Many ancestors arrived in the Bahama Islands when they served as a staging area for the slave trade in the early 1800s. Others accompanied thousands of British loyalists who fled the American colonies during the Revolutionary War.
School attendance is compulsory between the ages of 5 and 16. The government fully operates 158 of the 210 primary and secondary schools in The Bahamas. The other 52 schools are privately operated. Enrollment for state and private primary and secondary schools amounts to more than 66,000 students. The College of The Bahamas, established in Nassau in 1974, provides programs leading to bachelors and associates degrees. The college is now converting from a 2-year to a 4-year institution. Several non-Bahamian colleges also offer higher education programs in The Bahamas.
note: estimates for this country explicitly take into account the effects of excess mortality due to AIDS; this can result in lower life expectancy, higher infant mortality and death rates, lower population and growth rates, and changes in the distribution of population by age and sex than would otherwise be expected (July 2005 est.)
0-14 years: 29.43% (male 44,179; female 43,486)
15-64 years: 64.46% (male 94,329; female 97,674)
65 years and over: 6.11% (male 7,618; female 10,566)
Population growth rate: 0.93%
Birth rate: 19.1 births/1,000 population
Death rate: 7.14 deaths/1,000 population
Net migration rate: -2.65 migrant(s)/1,000 population
Infant mortality rate: 17.03 deaths/1,000 live births
Life expectancy at birth:
total population: 70.46 years
male: 67.27 years
female: 73.71 years
Total fertility rate: 2.3 children born/woman
Ethnic groups: black 85%, white 12%, Asian and Hispanic 3%
Religions: Baptist 32%, Anglican 20%, Roman Catholic 19%, Methodist 6%, Church of God 6%, other Protestant 12%, none or unknown 3%, other 2%
Languages: English, Creole (among Haitian immigrants)
definition: age 15 and over can read and write
total population: 98.2%
female: 98% (1995 est.)
In 1492, Christopher Columbus made his first landfall in the Western Hemisphere in The Bahamas. Spanish slave traders later captured native Lucayan Indians to work in gold mines in Hispaniola, and within 25 years, all Lucayans perished. In 1647, a group of English and Bermudan religious refugees, the Eleutheran Adventurers, founded the first permanent European settlement in The Bahamas and gave Eleuthera Island its name. Similar groups of settlers formed governments in The Bahamas until the islands became a British Crown Colony in 1717.
The first Royal Governor, a former pirate named Woodes Rogers, brought law and order to The Bahamas in 1718, when he expelled the buccaneers who had used the islands as hideouts. During the American Civil War, The Bahamas prospered as a center of Confederate blockade-running. After World War I, the islands served as a base for American rumrunners. During World War II, the Allies centered their flight training and antisubmarine operations for the Caribbean in The Bahamas. Since then, The Bahamas has developed into a major tourist and financial services center. Bahamians achieved self-government through a series of constitutional and political steps, attaining internal self-government in 1964 and full independence within the Commonwealth on July 10, 1973.
The Bahamian economy is almost entirely dependent on tourism and financial services to generate foreign exchange earnings. Tourism alone provides an estimated 60% of the gross domestic product (GDP) and employs about half the Bahamian work force. In 2000, over 4 million tourists visited The Bahamas, 83% of them from the United States.
A major contribution to the recent growth in the overall Bahamian economy is Sun International’s Atlantis Resort and Casino, which took over the former Paradise Island Resort and has provided a much needed boost to the economy. In addition, the opening of Breezes Super Club and Sandals Resort also aided this turnaround. The Bahamian Government also has adopted a proactive approach to courting foreign investors and has conducted major investment missions to the Far East, Europe, Latin America, and Canada. The primary purpose of the trips was to restore the reputation of The Bahamas in these markets.
Financial services constitute the second-most important sector of the Bahamian economy, accounting for up to 15% of GDP, due to the country’s status as a tax haven and offshore banking center. As of December 1998, the government had licensed 418 banks and trust companies in The Bahamas. The Bahamas promulgated the International Business Companies (IBC) Act in January 1990 to enhance the country’s status as a leading financial center. The act served to simplify and reduce the cost of incorporating offshore companies in The Bahamas. Within 9 years, more than 84,000 IBC-type companies had been established. In February 1991, the government also legalized the establishment of Asset Protection Trusts in The Bahamas. In December 2000, the government enacted a legislative package to better regulate the financial sector, including creation of a Financial Intelligence Unit and enforcement of “know-your-customer” rules. Since enactment of new regulations, many of the IBCs have closed shop in The Bahamas.
Agriculture and fisheries industry together account for 5% of GDP. The Bahamas exports lobster and some fish but does not raise these items commercially. There is no largescale agriculture, and most agricultural products are consumed domestically. The Bahamas imports more than $250 million in foodstuffs per year, representing about 80% of its food consumption. The government aims to expand food production to reduce imports and generate foreign exchange. It actively seeks foreign investment aimed at increasing agricultural exports, particularly specialty food items. The government officially lists beef and pork production and processing, fruits and nuts, dairy production, winter vegetables, and mariculture (shrimp farming) as the areas in which it wishes to encourage foreign investment.
The Bahamian Government maintains the value of the Bahamian dollar on a par with the U.S. dollar. The Bahamas is a beneficiary of the U.S.-Caribbean Basin Trade Partnership Act (CBTPA), Canada’s CARIBCAN program, and the European Union’s Lome IV Agreement.
Although The Bahamas participates in the political aspects of the Caribbean Community (CARICOM), it has not entered into joint economic initiatives with other Caribbean states.
The Bahamas has a few notable industrial firms: the Freeport pharmaceutical firm, PFC Bahamas (formerly Syntex), which recently streamlined its production and was purchased by the Swiss pharmaceutical firm Roche; the BORCO oil facility, also in Freeport, which transships oil in the region; the Commonwealth Brewery in Nassau, which produces Heineken, Guinness, and Kalik beers; and Bacardi Corp., which distills rum in Nassau for shipment to the U.S. and European markets. Other industries include sun-dried sea salt in Great Inagua, a wet dock facility in Freeport for repair of cruise ships, and mining of aragonite–a type of limestone with several industrial uses–from the sea floor at Ocean Cay. The Hawksbill Creek Agreement established a duty-free zone in Freeport, The Bahamas’ second-largest city, with a nearby industrial park to encourage foreign industrial investment. The Hong Kong-based firm, Hutchison Whampoa, has opened a container port in Freeport.
The Bahamian Parliament approved legislation in 1993 that extended most Freeport tax and duty exemptions through 2054. The Bahamas is largely an import, service economy. There are about 110 U.S.-affiliated businesses operating in The Bahamas, and most are associated with tourism and banking. With few domestic resources and little industry, The Bahamas imports nearly all its food and manufactured goods from the United States. American goods and services tend to be favored by Bahamians due to cultural similarities and heavy exposure to American advertising.
GDP: purchasing power parity – $4.5 billion (2000 est.)
GDP – real growth rate: 4.5% (2000 est.)
GDP – per capita: purchasing power parity – $15,000 (2000 est.)
GDP – composition by sector:
services: 90% (1999 est.)
Inflation rate (consumer prices): 1.9% (2000 est.)
Labor force: 156,000 (1999)
Labor force – by occupation: tourism 40%, other services 50%, industry 5%, agriculture 5% (1995 est.)
Unemployment rate: 9% (1998 est.)
revenues: $766 million
expenditures: $845 million, including capital expenditures of $97 million (FY97/98)
Industries: tourism, banking, cement, oil refining and transshipment, salt, rum, aragonite, pharmaceuticals, spiral-welded steel pipe.
Electricity – production: 1.465 billion kWh (1999)
Electricity – production by source:
fossil fuel: 100%
other: 0% (1999)
Electricity – consumption: 1.362 billion kWh (1999)
Electricity – exports: 0 kWh (1999)
Electricity – imports: 0 kWh (1999)
Agriculture – products: citrus, vegetables; poultry
Exports: $376.8 million (2000 est.)
Exports – commodities: pharmaceuticals, cement, rum, crawfish, refined petroleum products
Exports – partners: US 22.3%, Switzerland 15.6%, UK 15%, Denmark 7.4% (1998)
Imports: $1.73 billion (2000 est.)
Imports – commodities: foodstuffs, manufactured goods, crude oil, vehicles, electronics
Imports – partners: US 27.3%, Italy 26.5%, Japan 10%, Denmark 4.2% (1998)
Debt – external: $385.8 million (2000 est.)
Economic aid – recipient: $9.8 million (1995)
Currency: 1 Bahamian dollar (B$) = 100 cents