Economy of Belize

The economy of Belize is a small, essentially private enterprise economy that is based primarily on agriculture, tourism, and services. The cultivation of newly discovered oil in the town of Spanish Lookout has presented new prospects and problems for this developing nation. Belize's primary exports are citrus, sugar, and bananas. Belize's trade deficit has been growing, mostly as a result of low export prices for sugar and bananas.

Top Sectors in Belize

Agriculture in Belize

Agriculture is a key part of the economy. Banana production accounted for 16 percent of total Belizean exports in 1999. Citrus fruits are Belize's second most important agricultural Crop.<br>In 2018, Belize produced 1.7 million tons of sugarcane, being heavily dependent on this product. In addition to sugarcane, the country produced 100 thousand tons of orange, 80 thousand tons of banana, 77 thousand tons of maize, in addition to smaller productions of other agricultural products such as papaya, rice and soy.

Energy in Belize

A major constraint on a functioning market economy in Belize continues to be the scarcity of infrastructure investments. Although electricity, telephone, and water utilities are all relatively good, Belize has the most expensive electricity in the region. Several capital projects are currently underway. The largest of these is a $15 million rural electrification program to be jointly implemented by the government and Belize Electricity Limited (BEL).

Transport in Belize

Ports in Belize City, Dangriga, and Big Creek handle regularly scheduled shipping from the U.S. and the United Kingdom although draft is limited to a maximum of 10 feet in Belize City and 15 feet in southern ports. International air service is provided by WestJet, American Airlines, Delta Air Lines, United Airlines and TACA to/from gateways in Toronto, Dallas, Houston, Atlanta, Charlotte, North Carolina, Miami, and San Salvador.

Tourism in Belize

A combination of factors climate, the Belize Barrier Reef (longest in the Western Hemisphere), 127 offshore Cayes (islands), excellent fishing, safe waters for boating, scuba diving, and snorkelling, abundant jungle flora and fauna, and numerous Mayan ruins support the thriving tourism and ecotourism industry. Development costs are high, but the Government of Belize has designated tourism as its second development priority after agriculture.

Belize - Key Economic Indicators

Exports and Imports

Belize's main exports are agricultural products like citrus, bananas, and sugar, along with seafood and garments. Imports include machinery, fuel, and construction materials. While specific recent data might be hard to find, Belize has historically run a trade deficit.

Infrastructure Development

Belize's infrastructure is developing, but there's still room for improvement. The total road network is around 3,600 kilometers, with a mix of paved and unpaved surfaces. As of 2022, investments are ongoing to improve transportation links and expand access to electricity and internet.

Fiscal Policy

The Belizean government faces the challenge of balancing spending on social programs and infrastructure development with the need to control debt. Fiscal policy often involves tax adjustments and managing public spending to achieve these goals. Recent data shows some progress - the unemployment rate fell to 5% in 2022, the lowest ever recorded. However, public debt remains high at 72.8% of GDP in 2022.

Trade Agreements

Belize is a member of the Caribbean Community (CARICOM), which allows duty-free trade with other members. They also have trade agreements with several countries, including the US and Europe, and are actively seeking new partnerships.

Environmental Regulations

Belize boasts a rich natural environment, and the government is taking steps to protect it. Environmental regulations focus on areas like deforestation, pollution control, and sustainable resource management. These regulations aim to balance economic development with environmental protection.

Balance of Trade

This deficit is somewhat offset by earnings from tourism, a vital sector for Belize. The government is working to increase exports and diversify trading partners. Efforts might be showing some promise, with a projected GDP growth of 9.6% in 2023

Monetary Policy

The Central Bank of Belize is responsible for maintaining price stability and promoting a stable exchange rate. Their monetary policy tools include setting interest rates and managing foreign exchange reserves.

Tax System in Belize

Capital Gains Tax: Yes, Belize has a capital gains tax of 20% on profits exceeding BZ$25,000 (around $12,500 USD). This rate and threshold haven't changed recently.
Corporate Tax Rate: A flat corporate tax rate of 25% applies to business profits. This rate remains unchanged.
Sales Tax: Belize levies a 12.5% Goods and Services Tax (GST) on most goods and services. There haven't been any recent reported changes to the GST rate.
Property Tax: Property tax rates vary depending on the property's value and location. Generally, rates range from 0.1% to 1.5% of the assessed value. Recent data on specific property tax adjustments might be limited by location.
Payroll Tax: Belize uses a social security system funded by contributions from both employers and employees. The contribution rate is 6.75% for each, capped at a specific income level. This contribution rate hasn't changed recently.
Tax Deductions and Credits: Belize offers various tax deductions and credits to reduce tax liability. These include deductions for medical expenses, charitable donations, and certain business investments. There are also tax incentives for specific industries and activities, particularly in designated free zones. While the specific details of deductions and credits might change occasionally, no major revisions have been publicly announced in recent months.
Tax Compliance: The Belizean government is working on improving tax collection efficiency. However, some challenges persist, and the informal sector's size can make comprehensive tax collection difficult. There haven't been any major reported breakthroughs in tax collection efficiency recently, but the government's efforts might show improvement in future data.
Tax Burden: Compared to some regional neighbors, Belize's tax burden is considered moderate. The income tax exemption for residents earning less than BZ$26,000 (around $12,800 USD) annually helps ease the burden for low-income earners. This exemption threshold remains unchanged. It's important to note that recent economic data, like the projected GDP growth of 9.6% in 2023, might influence future tax policy decisions.

20 Live Notices for Belize ....

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Belize

15 Nov 2024

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