Inflation Continues to Affect Belize

We also asked Minister Coye about Belize’s low income levels referred to in Moody’s Investors Service’s report. According to the data, the country’s low income level exposes Belize to high social risks. Well, Minister Coye says he does not agree with this assessment of Belize’s income level. He contends that wages are increasing across the board. We also asked him about the high prices of goods and services associated with inflations. Many Belizeans are wondering when they can expect some relief. Here is what he had to say.

Christopher Coye

Christopher Coye, Minister of State, Ministry of Finance

“I don’t know that I would agree. It certainly varies depending on the age group you are talking about, the level of education you are talking about. You have to look by district, urban rural, all of those things, you will see significant differences in what the wages are and trends in wages are. But, across the board I think the wages are increasing on a whole. I just mentioned about the BPO sector and the level of wages and the level of impact that is having. There is a bit of concern as to whether that will have an inflationary level of effect, but for sure there is wage growth that is occurring. Now, as far as the minimum wage, it is not a proposal, that decision has already been made; it is just a matter of implementation which I understand that to be at the beginning of 2023. I think inflation is certainly something you have to monitor very closely. I will refer once again to the IMF in terms of their consultations with us a few weeks ago. They point out that Belize’s rate of inflation has been lower than the rate of inflation in the region. That in large part has to do with the fact that we have a fixed exchange rate and that helps to level the rate of inflation, but also some of the policy decisions that were made, including the capping on price of fuel, regular and diesel. So, that also had an effect of moderating the level of inflation we have been experiencing. Now, inflation has an international component. Belize, largely imports its inflation. That is a big reason why we have inflation.”