The World Bank Group this afternoon issued a diagnostic report on Belize that is primarily intended to help the Bank forge its own strategy for assisting Belize in major initiatives. However, “Belize: Right Choices, Bright Future,” as it is called, also offers a unique look at all aspects of Belizean development and society in the past 35 years and identified not only the major challenges which Belize must overcome, but also what the country has been doing right. Media personnel received a sneak preview of the findings on Wednesday, but we got a chance to formally discuss it today with author Francisco Carneiro, the Bank’s Lead Economist and Program Leader for the Caribbean. He summarizes the three major areas that the Bank would like to see Belize pay more attention to.
Francisco Carneiro, World Bank’s lead economist & program leader for the Caribbean: We looked at the history of economic growth and development of Belize and what we have seen is that Belize has done very well. But most recently the country has been facing a more challenging global environment and what we have identified is to put the country back on a sustainable map. Three items need attention, one, is the plight of education and the skills of the labor force. Number two the need to address crime and violence. And number three to strengthen resilience.
The Bank would also like to see more and more frequently collected data to help international and local analysis. While Belize has generally improved in GDP growth and per capita income since Independence in 1981, both have stagnated in recent years. Also, a review of the GDP growth revealed major peaks between 1982 and 1993 and 1998 and 2003, times when there was massive investment economically, and valleys between 1993 and 1998 and 2003 and present, when the Government has tightened its belt and not spent as much. Carneiro spoke to how best to level out the growth and sustain Belize’s main economic engines, agribusiness and tourism.
Francisco Carneiro, World Bank’s lead economist & program leader for the Caribbean: It was moved out the impact in terms of trades and productivity on the growth path to Belize. The true growth engines of Belize are of course business and tourism. So Belize relies quite a lot on those two sectors to create jobs and collect funding for the budget. So it’s very important that Belize remains competitive in those two sectors. IT’s important to make sure that the exploitation of this sector is having a sustainable basis so that we don’t harm the environment and the eco systems, Belize relies quite a lot on its eco systems so in that sense it would be important to think about sustainable options to develop further.
An important aspect of sustaining the economy is opening up capital to investors, especially small businesses locally. However, even with excess liquidity, the banks are feeling the squeeze from the de-risking phenomenon internationally. Carneiro tells us that Belize can lead the way in solving that dilemma:
Francisco Carneiro, World Bank’s lead economist & program leader for the Caribbean: What we did in the report was look at the restraints that Belize faces in the private sector development. Financial inclusion is a very important point that could perhaps help the private sector to develop further and we are aware of the derisking train around the globe and potentially Belize could be one country that could a lesson as to how to improve the legislation so that the strength does not affect the country as it’s doing in other parts of the world.
And finally, there are questions about Belize’s commitment to improving education and skill training, reducing crime and violence and improving governance. However, the Jewel has been lauded for its handling of the Conditional Cash Transfer Program known as BOOST, which sets targets for families to meet to receive their stipend. Carneiro says Belize must keep it up:
Francisco Carneiro, World Bank’s lead economist & program leader for the Caribbean: Transfers and social programs are very important because the boost inclusion, so it’s a very important initiative that will garner support around the world and that would be very helpful in the context of Belize as well.
Interestingly, Belize is ranked by World Bank standards as middle-of-the-road in perception of corruption as compared to other Latin American countries and ahead of the likes of Guatemala and Venezuela.