According to preliminary estimates compiled by the Statistical Institute of Belize, Belize’s economy grew by 5.3% during 2012; and according to the PM this growth is attributable to brisk activity in agriculture, agro-manufacturing, tourism, construction and telecommunications. During the budget debate and yesterday’s senate sitting the opposition questioned that growth within the economy and foreign investment, saying that poverty, unemployment and the sale of homes are on the rise in Belize which are indicators of an economy in dire need of help.
Here is an excerpt from Senator Karen Borden.
Senator Karen Borden:
It has never before caught my attention, the number of homes and properties that are listed in one week’s newspaper, Madam President. 85 homes and properties are up for sale. One edition of one of our leading newspapers. This for me is an indication that our economy is indeed in trouble. And in that newspaper it also caught my attention that the banks no longer refer to this exercise as Public Auction Sale, but rather as Mega Public Action Sales. Madam President, these are modest homes, these are not exorbitant enterprises. Our everyday Belizean families can no longer afford to keep a roof over their heads. That for me is a serious indication.
The Hon. Senator Godwin Hulse responded by saying that Government is indeed growing the economy, however economic growth does not necessarily translate into economic revenue for Government.
Senator Godwin Hulse:
I agree we should grow the economy and that is what is happening, but please remember growth in the economy does not necessarily translate into revenue for Government. It’s something we must always remember.
Yes, stimulating the economy and doing all of that is also Government’s responsibility through policies, but principally the Government’s money is spent on wages, pensions, utilities, the never-ending bludgeoning debt, public sector debt, and some capital investment. Government fixes roads and bridges and streets and things done.
We are talking about Government revenue, a scarce commodity. And so there’s the jack and ball, what we a spend it on, where we no a spend it on? What we need to do is to find a way to increase Government revenue. And that can not happen so lightly, because right now it’s principally from taxes, and it’s difficult to raise taxes beyond what is currently being taxed, some 25% of GDP.
And at a time when taxes are high, Hulse says that every potential investor wants a tax holiday; however these investors help to boost the economy by providing meaningful jobs.
Senator Godwin Hulse:
I am here to tell you that I chair a committee of the Cabinet for Economic Development, which is aggressively looking at every potential investor in this country, not to give him a hard time, but to make sure that he partners with the people of Belize right. And I’m here to tell you that just two days ago, we met with one of the major cruise lines, who wants to establish a port. We’ve looked at details. We looked at the other ones. We’ve looked at 5 criteria for proper investment. First being that it must be socially and economically acceptable, and legally doable. The next criteria: it must bring some revenue to Government. It must bring meaningful jobs. My colleague who sits on the committee can tell you, I tell them what meaningful jobs are, accountants and managers and all those people turning out a Gallen and UB, not cleaners and grass-cutters and sweepers. No minimum wage jobs, [but] meaningful jobs. Those are the criteria we set. And what is the response? The majority of the investors want a 30 years tax holiday, 20 years tax holiday, and they read it out all in a tax holiday too, customs duty, sales tax, business tax. They want all of that waved. How that help we?
Hulse alludes that economic growth is slow and the raising of taxes is not an option; and in his eyes, Oil is the saviour and answer to economic growth. However Hulse says that Belizeans need to decide what they want as we want revenue but we do not want to drill for oil because everything is protected.
Senator Godwin Hulse:
There’s a group out there lobbying against oil drilling, and this one comes from the heart, offshore and even onshore, in the so-called protected areas. So what we want?
Explain to me, how is it that every time I go to Spanish Lookout, the nicest looking village in this country, in terms of layout and everything, I see quiet pumps up and down next to restaurants that you can eat in and hear music. I don’t hear no squeak, see no spill, see no mess. I see beautiful nice shiny stainless steel tankers carrying 9.960 gallons of crude, rolling out there, driven by Mennonite boys, on good roads, nice banking and everything, and people making money in that community. How is it [that] it has not destroyed their environment? But we can’t drill in the Maya area, we can’t drill in the Garifuna Area. We can’t drill in the Criole area, we can’t drill in the Mestizo area. Is this a conspiracy against us? Or Is this limited only to white man. Gimme a break. I asked the question more than once, and many of us are fighting to prevent it. I say again, look at ourselves properly, and the next time they find oil in this country I can assure you it will be in Blue Creek.