DOING BUSINESS IN BELIZE

 

The cost of setting up shop, whether you plan to invest,
or just retire here

Planning on starting a business, or dreaming of building a resort in Belize? You're not alone. Our gentle climate, tropical beauty and relaxed way of life are a lure to many, whether retired, close to retirement, or still actively involved in business. If you want to be in Belize, and have had successes elsewhere, chances are you can make a go of it here. To help you in formulating a business plan, we have compiled an assortment of general data relating to wage rates, cost of construction and other items, and some miscellaneous "insider information."

Land
Land in Belize is still reasonably priced, if the owner wants to sell it. If you approach someone about buying land you like, that is not listed, you will likely have to pay a lot more, but that's to be expected­and not to say you still wouldn't be able to strike a bargain. Non-Belizeans wishing to purchase more than 1/2 acre within city limits or ten acres elsewhere, must first acquire a license from the Ministry of Natural Resources, and must submit a development plan prior to approval (unless said land is already developed). There are no other restrictions on foreign ownership. It is sometimes possible to lease land from the Government of Belize, with an option to buy the land after the proposed development is completed. Tax on ten acres of agricultural land is about US$125/year, and about US$20/year for a town lot.

You definitely will want a Belize lawyer to handle any actions you take with respect to land; to run a title guarantee check first, and handle your land purchase (or lease request) as well; many friendly deals have been struck with unsuspecting visitors who ended up losing money. A lawyer also has local connections, which can be very helpful for foreigners in a strange land.

Wages (in US$)
Wages for workers average $10/day for common labour (clearing land, hauling materials). Minimum wage for manual workers is $3.30 BZ ($1.65 US), although the average graduate, with at least an Associatesí Degree, would expect to be paid a minimum of between $4.44 and $6.25 an hour..

If you are paying workers yourself (versus hiring a contractor that pays his own workers) you will have to make Social Security deductions and contributions: for example, a worker who makes over $55/week gets $0.65 deducted from their pay, and employers must contribute $3.90/week on each employees behalf. Income taxes must also be deducted, but only for those earning over $10,000/year. There are plenty of quality workers and craftsmen in Belize, and as with anywhere else, you may have to look a bit to find them. Your best assurance of getting things done the way you want them, is to be on hand for frequent supervision.

Resorts in operation generally pay US$10-12.5/day for general staff, but many remote locations provide meals and housing--and therefore pay less in actual cash.

Developers should bear in mind that the cost of living in and around Belize City is higher than elsewhere in the country, and for some occupations, wages there would be proportionately higher.

Materials (in US$)
Lumber is quite inexpensive--even hardwoods, but usually it is air dried, so it can be of unpredictable quality at times. Cement costs about $8 for a 110 pound bag. Sand/gravel mix is $65 per truck load. Steel and PVC materials are reasonably priced. Plywood, and most other imported, wood-based material is very expensive. Sheet rock runs about $12.5 per 4'x8'x1/2" sheet and 8"x16" cement blocks are$0.55 ­.60 each. If you are developing on a large scale, you will be able to negotiate some discounts with the local suppliers. Bear in mind that all tools are imported and can be expensive, especially power tools; that said, it's still best to buy them here so that replacement parts will be readily available.

Gasoline is US$2.50/gallon, but you can cover most of the country in just a few hours' driving time. Vehicles will be your major expense, however, utility vehicles, such as pick-up trucks, carry a much lower duty rate: 15% versus 45% for passenger cars, and the locally popular 4-wheel drive "sport utility vehicles" (despite the name). Plus there is currently a Value Added Tax of 15% on top of that, on all purchases. If you import your own used vehicle(s), these same charges will be applied based on their current value. Be sure to contact Customs in advance, with the particulars of your vehicle, to confirm your actual expense.

Utilities (in US$)
Of the three utilities, the government-run Water and Sewerage Authority (WASA) is the fastest and most efficient in terms of getting you hooked up. Water rates vary slightly depending on locale and charges are calculated on a sliding scale. Outside of Belize City, the rate based on a consumption of 100,000/month is approximately $0.006 per gallon. The household rate in Belize City is closer to $0.01 per gallon. Many areas of Belize are blessed with year 'round, natural water sources, which could also be considered as a means of generating electrical power.

Electricity rates for industrial consumers are based on a usage of more than 30,000kwh per month; the rate for the first 50,000kwh is $0.20/kwh and $0.17/kwh for the balance; monthly service charge is $37.50. Non-industrial (less than 30,000kwh per month) users are charged $0.10/kwh for the first 50kwh, $0.17/kwh for the next 150kwh, and $0.21/kwh for the balance; monthly service charge is $2.00.

Telecommunications services in Belize are the best in the region. However, because it is operated by a monopoly, the rates are high. Internet and e-mail services are billed according to time used, as opposed to a flat-rate, unlimited access charge. A one-minute call to the United States during peak hours costs $1.58. Calls to Mexico and Central America are $1.00/minute; to Europe and beyond $3.00 and $4.00/minute. Even local calls are billed by the minute (BZ$0.05).

Some final notes:
Although tourism is the fastest growing industry in Belize, there is presently a surplus of small- to medium-sized resorts. A viable alternative to building your own would be to purchase an existing "fixer-upper" and modifying it to reflect your own style. As with any business, anywhere, your chances of success here are greatest with an owner or partner presence on site the majority of the time. Deal respectfully with local elected representatives as necessary, but stay out of "politics."

The recently established Trade and Investment Promotion Service (TIPS) in the capital, Belmopan, would be a good source for information on all aspects of investing here, including details of the incentive programs offered by the government. If you opt to apply for the Fiscal Incentives Program, which offers tax holidays and duty exemptions to approved enterprises, you will want a local accountant or a consultant which specializes in preparing the applications, and can usually speed things up, since they would have local contacts. If you don't have a referral you can trust, you should visit with some of them in person, and ask for references, before hiring their services.

What is the best rule of thumb for doing anything in Belize?
Smile a lot and go with the flow!

For more information:

TIPS
#3 Unity Blvd.
Belmopan, Belize
Tel: 501-8-23737
& 23745
Fax: 501-8-20595
tipsbze@btl.net
Commissioner of
Lands and Survey
Ministry of
Natural Resources
Belmopan, Belize
Tel: 501-8-22331
Fax: 501-8-22333
Belize Tourist Board
83 North Front St.
Belize City, Belize
Tel: 501-2-77213
Fax: 501-2-77490
btbb@btl.net


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