Statement by an IMF Mission to BelizePress Release No. 12/443
November 15, 2012
An International Monetary Fund (IMF) mission lead by Mr. Gerardo Peraza, visited Belize from November 1-15 to conduct its yearly review of the country’s economy, in the context of the IMF’s Article IV consultations.1 Mr. Peraza released the following statement in Belmopan at the conclusion of the meetings today:
“Belize is experiencing an output rebound despite the decline in oil production. In 2012, real Gross Domestic Product (GDP) growth is expected at 3.5−4 percent, led by a recovery from last year’s effects of weather-related damages in commodity exports as well as a recovery in tourism, and electricity generation. Inflation, which stood at 1.5 percent in January-August, has been easing as commodity prices pressures abate. The current account deficit is expected to narrow to 2.3 percent of GDP (down from 2.5 percent of GDP in 2011) thanks to higher inflows from tourism, lower repatriation of dividends by foreign companies operating in Belize, and higher remittances, despite a moderate widening of the trade deficit in goods. Preliminary fiscal data suggest that the government’s primary surplus target of 2 percent of GDP is within reach, but 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. Talks are expected to resume in the near future. Discussions so far have been focused on fiscal sustainability, external stability, and policies to enhance the financial sector resilience. In parallel with the Article IV consultations, a technical assistance mission assessed the current framework for debt management and helped the authorities build relevant institutional capacity.
“The mission would like to thank the Belizean government officials as well as political opposition, private sector and labor union representatives, with whom it had the privilege of exchanging views, for their excellent collaboration.”1 Under Article IV of the IMF's Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country or territory, collects economic and financial information, and discusses with officials the country's economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board.