A weeklong visit to The Bahamas ended  with the International Monetary Fund (IMF) giving a positive assessment of the local economy.

Having discussed the country’s outlooks and risks, financial developments and sectors, the IMF team concluded that the Bahamian economy continues to recover, with real GDP growth projected to reach 2.3 percent in 2018 and 2.1 percent in 2019.

This growth is said to be driven by an increase in tourist arrivals, paired with an expansion of hotel room and airlift capacity and against the backdrop of the continued expansion of the U.S. economy.

It calls then for maintaining strong fiscal and financial policies to bolster resilience and build buffers should external conditions become less favorable, and for advancing reforms to achieve more inclusive growth over the medium term.

The IMF finds the enactment of the fiscal responsibility law a welcome development as is the plan to establish a disaster relief fund.

The government was further patted on the back for narrowing the fiscal deficit from 5.5 per cent of GDP in the 2017 fiscal year to an estimated 3.3 per cent in fiscal year 2018.

There’s a commitment for further fiscal consolidation, targeting an overall deficit of 1.8 percent of GDP.

Further, the team said it welcomed the government’s transparent recognition of accumulated arrears and the budgetary provisions to clearing them, as well as the plans to put in place robust expenditure control systems.

Banks were also given high marks for making progress towards improving asset quality.

Deputy Prime Minister and Minister of Finance K. Peter Turnquest views the IMF’s positive assessment as an indication that the government’s policies are starting to pay a dividend and that it is pleased to see its efforts are being recognized by the IMF and others.

He however acknowledges that the economic recovery is still not as buoyant as the government would like to see it.

In fact in a statement, he admits it has not been easy to cut the fiscal deficit by some 37 per cent in one year  – down from $661 million to $415 million – but that the simple truth is that the government must stay the course as there is a tremendous amount of work left to do to quicken and strengthen the ongoing recovery and to ensure long term fiscal stability and economic resilience.

The government’s expected to bring several new pieces of legislation in the coming months – public procurement legislation, public financial management legislation and public debt management legislation.