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  • Economy

Belize - Economy

KEY FACTS 2006

  • GNI: US$1.2bn
  • GNI pc: US$3,800
  • GDP growth: 4.9% p.a. 2003–07
  • Inflation: 3.3% p.a. 2003–07
  • Aid: 0.7% of GNI (2006)
  • External debt: US$1.0bn (2006)

Overview: Belize’s economy is predominantly agricultural, with a heavy dependence on exports of sugar and citrus concentrates, so that it is vulnerable to the volatility of that world market. Efforts have been made to diversify from traditional export products such as sugar and timber into bananas, citrus concentrates, seafood and fish products. Forestry has been revitalised and tourism expanded to become a significant foreign currency earner. Since 1990, an export-processing zone has been developed near Belize City International Airport, mainly for clothing production. And, mainly for domestic consumption, a free zone has been established at Corozal on the coast near the Mexican border.

Though Belize had not had a formal relationship with the IMF, it implemented its own structural adjustment programme, with expenditure controls, a public-sector wage freeze and job cuts, and some privatisation, aimed at restoring a fiscal surplus.

There was a short pause in the vigorous economic growth of the early 2000s when, in 2001, the fourth hurricane to strike Belize in three years caused heavy damage to tourist facilities and rice production in the southern part of the country. Strong growth resumed, rising to 9% in 2003, before moderating to 4.6% in 2004 and 3.1% in 2005. It rose to 5.6% in 2006 and weakened in 2007, reflecting the impact of Hurricane Deanon agricultural output and tourism, while inflation remained at 3%.

Trade: Main exports are citrus concentrate, fish products, sugar and bananas. Main imports are machinery, transport equipment, manufactured goods, fuels, food and chemicals. Main export partners are the USA (52%), the UK and other European countries. Main import partners are the USA (40%) and Mexico.

From 2007, when the Cotonou Agreement between the European Union and the ACP grouping of developing countries came to an end, negotiations proceeded on a series of regional Economic Partnership Agreements, to replace the preferential trade agreements of the Cotonou Agreement with WTO-compliant free-trade areas.