One of the issues concerning the Bahamian public sector is providing adequate services across The Bahamas, especially to the southern-most Family Islands, Inter-American Development Bank (IDB) Country Economist Dr. Allan Wright told Guardian Business in a recent interview.
Wright lamented the challenges of the country's investor climate to date. And while The Bahamas has some ideal perks for doing business, Wright pointed out that the current fiscal state poses a challenge.
For instance, he noted that The Bahamas has access to international finance, "but the high cost of financing and elevated unemployment rates have weakened domestic consumption and investment demand," he added.
"The Bahamas' developmental and growth challenges are centered on low investment and timid entrepreneurship, which result in low returns on economic activity and high financing costs," said Wright.
"The former is being impacted by low social returns and appropriability due to a relatively large and somewhat inefficient government sector, and a private sector weakened by an inadequately trained workforce, both operating within a vast geographic expanse of islands and cays with inadequate infrastructure."
The economist said that underlying low appropriability "is the problem of a limited public sector".
"The public sector faces challenges in providing adequate services across The Bahamas," he said.
"Shipping and air connectivity are particularly challenging, as well as water services and sanitation. Tightening fiscal space has made this challenge even more pronounced."
The Bahamas also faces private sector appropriability, which Wright said has been impacted "by an inadequately trained labor force and other market and coordination failures".
"The private sector faces challenges in terms of high energy costs and frequent power outages, restricted financing access and rising costs, and low research and development expenditure," he continued.
"Weak protection of minority investors and property rights, rising crime and violence, and low levels of coordination between the government and the private sector to develop industries that encourage diversification and sophistication. These constraints have all diminished the country's ability to mitigate its dependence on exogenous factors and to improve factor productivity."

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