IMF: Belize Experiencing Output Rebound, Tourism Recovery

Above: Belize (Photo: Belize Tourism)

By the Caribbean Journal staff

Belize is experiencing an output rebound, despite a decline in oil production, according to the International Monetary Fund, which just concluded its yearly review of the country’s economy.

According to the fund, Belize is expected to see GDP growth this year of between 3.5 and 4 percent, led by a recovery from last year’s weather-related damages in commodity exports, along with a recovery in tourism and electricity generation.

An IMF mission led by Gerardo Peraza visited the country from Nov. 1 to Nov. 15 to conduct the review, which came in the context of the IMF’s Article IV consultations.

Belize’s current account deficit is projected to narrow to 2.3 percent of GD, also thanks to higher inflows from tourism, along with higher remittances and lower repatriation of dividends by foreign companies operating in Belize.

The fund said that, according to preliminary fiscal data, the government’s primary surplus target of 2 percent of GDP is also within reach, although that will require a “close monitoring of spending for the remainder of this fiscal year.”

“In light of ongoing negotiations with bondholders on the restructuring of the ‘super-bond,’ further discussions with the authorities are required to complete this year’s Article IV consultations,” Peraza said. “Discussions so far have been focused on fiscal sustainability, external stability and policies to enhance the financial sector[‘s] resilience.”

Talks are expected to resume on the bond in the near future.

During the mission, a technical assistance mission to Belize examined the current framework for debt management and helped the authorities build “relevant institutional capacity,” the fund said.