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Jan 23, 2018

Things Look Better, But Not Much, Foreign Forecast Says

For those still wondering if the best is yet to come going into an election year, The Economist Intelligence Unit says not quite. Its quarterly economic forecast predicts a return to form, but less than expected. Its first-quarter report says Belize continues to cope with significant internal and external pressures socially, politically and economically. While the agricultural sector and tourism are projected to lead the comeback, the E.I.U. points to continuing debt concerns, especially the still-unresolved U.H.S. loan payment of over ninety million dollars and counting. Belize remains middle of the pack in comparison to its Central American and Caribbean neighbors in both economics and crime, and the Unit calls for “political will” to steer the ship through these choppy waters. News Five’s Aaron Humes takes a closer look at the January 2018 report.

 

Dean Barrow

Prime Minister Dean Barrow [File: January 3rd, 2018]

“2017 was certainly an improvement over 2016, not least in the fact that the year just past saw a return to all-important GDP and economic growth. Exports were up an impressive thirteen percent in the first nine months, and a historically low year-over-year inflation rate, pegged at just one point two percent continued. The importance of this in preserving the purchasing power of the Belize dollar, helping to fight poverty and growing the middle class, cannot be overstated. We had a bumper sugar crop, increased our access to export markets in the non-traditional areas of chicken, grains, processed meat and even ice cream. And tourism continued its magnificent star turn as the highest flyer of all.”

 

John Briceño

John Briceño, Leader of the Opposition [File: January 3rd, 2018]

“I think it would be fair to say that 2017 was not a good year for Belize. We saw so much go wrong: our economy grew by only half a percent. That means that the better year for our productive sector that we wished for did not happen. Overall, our economy suffered major shocks, as government had to pay out hundreds of millions in compensation because of bad decisions in a number of legal cases. What this means is that we start the New Year with the understanding that the Government, led by Prime Minister Barrow, has put the Belizean economy on the brink of crisis.”

 

Aaron Humes, Reporting

The Economist Intelligence Unit’s perception of Belize as a country going into 2018 falls in the middle of these contrasting views. In the political context, the Prime Minister is headed into the twilight of his administration, and even before the end finally comes in 2019 or early 2020, the E.I.U. predicts bruising internal struggles in both major political parties. For the U.D.P., second-in-command, Deputy Patrick Faber faces challenges from the likes of John Saldivar and potentially Gaspar Vega for the right to steer the ship. While Opposition Leader Johnny Briceño too is predicted to face another leadership challenge from within a party, but no such challengers have emerged heading into Sunday’s national convention in Belize City. But whoever is in charge must wrestle with an enigmatic economic outlook. The E.I.U. predicts that the government and Belize will not be able to keep debt down despite a return to good economic growth of one point five percent, up from just zero point seven percent so far in 2017. Prices are expected to continue to rise, but modestly. Export growth will recover and services will remain supportive. But with the Petrocaribe oil financing program struggling to find its legs, other sources will be turned to, to repay that crippling ninety million dollar judgment debt from the Belize Bank, about which the House meets in February. Rising oil prices will also affect the prices at the pumps and for butane. Also keep an eye on tourism activity: with agriculture, fishing and manufacturing underperforming in 2017, expansion in tourism, driven by visitors from the U.S., has kept the economy growing. Attention will turn to how well it performs during the peak holiday season which runs from late November to late April, says the E.I.U. The bottom line is that Belize is coming back, but there is much more work to be done. Aaron Humes reporting for News Five.

 

According to the E.I.U., Belize’s G.D.P. per capita leads a number of Central American nations including Guatemala and Honduras but lags behind more developed nations in the hemisphere.

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