Belize Business News

Belize has renewed its Educational and Cultural Cooperation Programme with Mexico by signing a new agreement with this partner for the period 2010-2013.

On December 14, the agreement was signed by Belizean Minister of Education Hon. Patrick Faber and Mexico’s Ambassador to Belize, His Excellency Mario Velázquez, at the Institute of Mexico in Belize City.

The new programme 2010-2013 is one of the results of the 6th Binational Commission and of the 8th Meeting of the Joint committee of Educational and Cultural Cooperation, which was held simultaneously in Mexico on September 29-30, 2010.

On October 21, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Belize.

According to the IMF, Belize has weathered the financial crisis relatively well, as compared with other Caribbean jurisdictions.

Output expanded by 2.7% in 2010 owing largely to activity in the electricity and wholesale and retail trade. 12-month inflation was 0 in 2010, which reflects primarily continued weakness in domestic demand, and picked up slightly in the quarter ending in May driven by higher food and fuel prices. The external position of Belize strengthened, as a narrowing in the current account deficit (from 6.1% of GDP in 2009 to 3% in 2010) underpinned an increase in foreign reserves to 3.25 months of imports at end-2010, equivalent to 300% of 2011 external financing needs. Public debt rose to 83% of GDP.

In Fiscal Year 2010-2011, the overall fiscal deficit widened by 0.3% point of GDP to
1.5% of GDP, which reflects an increase in expenditure and weak grant disbursements. However, it should be noted that this outturn was better than envisaged in the budget. Bank prudential indicators have remained weak, with high nonperforming loans (NPLs) and low provisioning. Bank liquidity remains ample. In July 2011, the authorities participated in their first Financial Sector Assessment Program (FSAP). Despite a cut in reserve requirements, bank credit growth has slowed as fewer investment opportunities and high NPLs continue to constrain new lending. Despite the allocation of significant resources to social protection, improvements in social indicators have been protracted.

The International Monetary Fund stated that Belize’s macroeconomic outlook for 2011 remains moderately positive. Output growth is projected at 2.5%, reflecting a strong performance in the 1st quarter. Higher food and fuel prices are projected to push inflation slightly upward. The external current account deficit is to remain at about 3% of GDP in the context of some improvement in trade. The reserve coverage would remain at around 3 months of imports by year-end.

Executive Directors commended the authorities for their macroeconomic management, which enabled Belize to weather the financial crisis relatively well. They emphasized the need to further tighten the fiscal stance and rebuild macroeconomic buffers. Also, they agreed that safeguarding financial sector stability should be a high priority. So, directors welcomed the authorities’ plans to use the findings of the recent FSAP in order to guide their reform agenda and strengthen the financial industry. In addition, directors emphasized the need to strengthen the macroeconomic framework and the business climate to tackle Belize’s low productivity growth, as well as stressed the importance of close collaboration between the IMF and development partners in these sphere.

The crew of 11 Sri Lankans who had traveled to Belize supposedly to make a movie were sent back because they were suspected of being involved in human trafficking using Belize as a springboard to try and get to the US.

However, the film crew went on the news and defended themselves boasting of their film-making credentials and saying they wanted to make a movie with the Belize Blue Hole as the backdrop. But, according to a representative of Sri Lanka’s Special Media Unit, they are not Sri Lankan movie makers. So, the Commissioner has decided to repatriate them to Sri Lanka.

US President Obama has added Belize to a blacklist of countries considered as major producers or transit routes for illegal drugs.

According to officials, cartels were using the jurisdiction as a route for smuggling cocaine from South America north to Mexico and the United States. The inclusion of Belize on the blacklist could reflect the growing influence of Mexico’s powerful drugs cartels.

As a result of the inclusion, Belize can face US sanctions.

Besides Belize, 22 countries were included on the drugs blacklist.