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Belize experiences Biggest Economic Boost since 2015 Print E-mail
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Friday, 02 November 2018 00:00

While Prime Minister Barrow has not been back in the country too long since his surgery in Cuba, he is already demonstrating his full engagement in the affairs of the country. He held a press conference on Monday, October 29, 2018 where he exercised that engagement. His first item of the day was the always-important: Belize’s economy. The Prime Minister started quoting a Central Bank memo of Friday, October 26, 2018. What stands out is that when we compare the first half of 2018 to the same period of any year since 2015, this year’s GDP growth is something to talk about.

“That memo makes the point that our GDP expanded by 3.4% in the first half of this year. You will recall that not too long ago, the SIB (Statistical Institute of Belize) certified Q2 economic growth of 5.4%, with a comparatively low unemployment rate of only 9.4%. And this half year 3.4% growth is the highest for the first six months if any year since 2015. Our current account deficit also narrowed from 49.3 million in the half of 2017, to 26.1 million in the first half of 2018.”

Prime Minister Barrows says that the Central Bank of Belize’s foreign assets is comfortably above the internationally mandated benchmark, standing at 584.3 million, or 3.6 months of import cover. “Our financial system is healthy, the balance sheets of the domestic banks are robust and their aggregate ratio of non-performing loans remains well below the guideline threshold of 5.0%.”

Even the International Monetary Fund (IMF) says, “Belize’s economic recovery is strengthening, the Government is making significant progress towards debt reduction and the CBB has taken resolute action to improve financial soundness.” They went on to commend the Government of Belize for increasing the primary balance to a 1.3% of GDP surplus and acknowledged that the current budget raises the primary surplus still further to above 2%.

But what has caused this steady increase in GDP and improved economic performance? The Prime Minister says that it is it tourism. “Overnight arrivals this year have been up every single month over the corresponding month for 2017. And by end December, the year on year increase will be just shy of 11%.  This continues the record setting phenomenon of an unbroken 10-year stretch of a year-over-year Belize tourism growth with that growth being double digit for each of the last three years.  With major new investments in hotel construction and additional airlifts, as we witnessed the direct flights from Mexico next month and from Minnesota by December, this trend is only expected to get better.  And it is the same story with cruise tourism, as of September, cruise passenger arrivals are 19.9% over the same period for 2017.”

PM Barrow says that while our agriculture sector is mixed, our banana industry is doing well. “Agriculture, our other economic mainstay, is more of a mixed bag. But banana is doing well and will do even better with port improvement for alongside berthing, and the rehabilitation and putting back into production of some of the old John Zabaneh farms. Citrus is still in the recovery mode, but it on the cusp of receiving a huge new capital injection from an international direct foreign investment proposal. And sugar awaits the CARICOM decision to impose the CET (Common External Tariff) on extra regional imports of refined white, making way for its substitution by the plantation while produced by Belize, Guyana, Jamaica, and Barbados. This would mean increased regional market share for us and a substantial hike in earnings for our farmers. Also, ASR is seeking IDB Invest loan funds to assist independent growers with rehabilitation expansion, and GOB has already provided its required non-objection letter.”