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Dec 6, 2010

Businesses in critical financial problems within the Corozal Free Zone

While BSI will be receiving the ten million dollar bailout, the situation in the Commercial Free Zone remains grave for businesses that have been unable to make deposits in US dollars. An emergency meeting was held last Friday evening between government, Central Bank and Free Zone officials but the situation persists tonight, and if it remains unresolved for much longer, it could have serious financial ramifications during one of the busiest periods at the Zone. News Five’s Isani Cayetano reports.

Isani Cayetano, Reporting

While it is the height of the Christmas shopping season business at the free zone is not what it appears to be.  Its merchants have not for the past few weeks been able to make financial transactions with counterparts in China, Panama and the United States.  Subsequently, they have not been able to purchase and import goods.

The procedure is such that the U.S. dollar which is the primary currency used at the zone is routinely deposited into one of two banks operating in the area, namely Atlantic and Belize Banks.  The monies are later transferred to the Central Bank of Belize which then conducts the overseas transactions with a number of lending institutions including Bank of America.  Recently those banks have not been accepting the monies forcing Central Bank to hold on to an accumulating figure, in the range of seventeen million dollars, which it cannot use to carry out business on behalf of its clients.  The reason for the freeze has not been explained but it is known that the Central Bank is looking for another corresponding bank for the transfer of U.S. dollars.  It is a problem that has many store owners concerned about the fate of their businesses.  On Friday evening an emergency meeting was convened to address the matter.

Present at the meeting was Central Bank Governor Glen Ysaguirre, board members representing the Commercial Free Zone, officials from the Ministry of Finance and  Minister Patrick Faber.  While a solution is being sought and several options are being explored News Five was reliably informed today that the situation will be discussed during Tuesday’s Cabinet meeting.  The CFZ committee of management is also expecting a favorable response from Ysaguirre on Tuesday but cannot say for certain whether an answer is forthcoming before the end of this week.

Reporting for News Five, I am Isani Cayetano.

Viewers please note: This Internet newscast is a verbatim transcript of our evening television newscast. Where speakers use Kriol, we attempt to faithfully reproduce the quotes using a standard spelling system.

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5 Responses for “Businesses in critical financial problems within the Corozal Free Zone”

  1. rootsman says:

    Banks in the US does not arbitrarily refuses to accept deposits, the controller of currencies is the regulatory arm of national banks in the US and decision like these most certainly was handed down, with the world now recognizing that Belize engages in narcotic trafficking, human trafficking and a host of other illegal activities which apparently seems to have the blessing of the Belize government it will only get worse before it gets better.

  2. Common Sense says:

    But why was the account closed? Does someone similar to Eric Cantona in France need to prompt people to close accounts until some answers are given?

    Please keep digging Channel 5 – I think rootsman is correct, but we wont get an answer unless you continue digging for the answers!

  3. Manford says:

    Rootsman you are wrong about controller of curencies and deposit of Central Banks account. This strictly the domain of the Federal Reserve. Note that the Priminister has chosed to pick a fight with a formidable force with far more international connections. And as the saying goes, there are many ways to skin a cat. Read between the lines.

  4. rootsman says:

    Manford you are partially correct but I am not wrong they are both regulatory bodies the OCC for federally chartered banks or national banks and the Federal Reserve for state chartered banks the OCC regulates nearly two thirds of the assets of the commercial banking system in the United States.

  5. vigilante justice 316 says:

    Manford, please do tell who the primeminister is picking fights with that has our country in a headlock.

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