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#96097 - 01/20/05 01:16 AM Will it hit the fan?
Lan Sluder/Belize First Offline
[An editorial opinion piece on BelizeFirst.com]

I’m stuck down in Honduras.
I’m a desperate man.
Send lawyers, guns and money.
The shit has hit the fan.

--Warren Zevon, “Lawyers, Guns and Money”


IS THERE A CRISIS IN BELIZE?

OPINION BY LAN SLUDER

With apologies to the late, great songwriter and singer Warren Zevon, it looks like years of crud and cronyism are about to hit the fan in Belize.

On Thursday and Friday, January 20-21, a good part of Belize may be shut down by action by labor unions and businesses. Schools across the country will be closed. Shops will close. Public unions will hold a work slowdown. Even some public utilities may be shut down. (I'm told the water is already out in parts of Belize City.) Several banks maybe closed.

On Tuesday, January 18, the Belize Chamber of Commerce held a meeting with more than 125 business people in attendance. The business people say they have a problem with what’s happening in Belize, with increases in taxes amounting to more than US$50 million. At the same time, from the other side of the field, the Public Service Union is planning a go-slow work action. The National Trade Union Congress is also moving into action.

I’ve heard from people at all levels in Belize over the past few days, and the common theme is: “Things are going to have to change.”

What could happen January 20-21 is only the tip of the iceberg ... er, coral reef.

For those who may not closely follow developments in Belize, the current government in Belize appears to have run out of elbow room. Years of insider dealing, financial irresponsibility, overspending and kowtowing to the interests of the big guys -- like Carnival Cruise Lines and the political and economic elite in Belize -- have created something of a crisis, according to observers in Belize.

The government is running a large budget deficit and is spending much more than it takes in. It has a huge trade deficit. Cronies and insiders have been rewarded with big contracts and sweetheart deals. Small entrepreneurs and conservation interests have been dissed. The big stake holders -- Carnival Cruise Lines and political insiders -- have been rewarded with new, financially lucrative deals. The currency has been under stress. Financial experts have been called in.

Yes, it does sound a lot like the United States under George Bush, doesn’t it? Except on a much smaller scale.

A few weeks ago, Prime Minister Musa sacked several of his most effective cabinet members, like Mark Espat, the tourism guru.

Over the past year, and particularly in the last month, the government has announced a massive series of tax increases:

The “environmental tax” will increase by 2 percentage points -- that’s like a nationwide tax on consumption. At the same time, the government has approved a dolphins swim-a-rama and have considered privatizing part of Belize’s most precious natural asset, the barrier reef.

Tourists visiting Belize and staying longer than 30 days will have to pay US$50 a month to renew their tourist card, a 400% increase.

Property taxes are being increased significantly, and a speculation tax will hit large property holders.

Business taxes will be increased.

Work permit fees have been increased -- in some cases doubled (a professional work permit is now US$1,500 a year, and a self-employed permit is US$1,000)

Wages increases for public workers will be held down, and some cutbacks will be made.

The hotel tax has been increased to 9%.

Taxes on alcohol and tobacco have been raised. Again.

Entry fees to parks, ruins and reserves have been increased, doubled in some cases.

The international exit tax has been increased from US$20 to $35, due to a new airport fee.

Belize, already the most expensive destination to visit in Central America, has become more expensive. Belize, already the most expensive country in the region in which to do business, has become more expensive.

Further, permanent residency applications have been held up for months, so expats wishing to live in Belize have been kept in limbo.

On the non-financial side, the government has moved ahead with a dam that will destroy prime wildlife habitat. It has gotten in bed with the big cruise ship industry, while leaving small hotel owners and tourism operators hanging.

Does this civil action January 20-21 portend future instability?

Will the government be brought down?

Will the Belize dollar peg to the U.S. dollar be dropped?

I don’t know. No one knows. Historically, protests have a way of escalating into revolutions, and revolutions have a way of snowballing.

Prime Minister Musa obviously is worried. In a speech today (January 19), he mentioned “civil unrest” and “lawlessness.”

He said: ‘What is at stake here is no less than the peace and tranquillity we have come to take for granted under our vibrant democracy.”

But the betting is, and my guess is, that things won’t change very much. This too shall pass.

Indeed, in laid-back Belize, it all may just fizzle out.

But I’m betting the government will have to come back to the table, to renegotiate. The PUP and its pals may have to eat a little crow.

In any case, let’s hope that what happens in Belize won’t worry the small investors, entrepreneurs, tourists and others in the U.S., Canada and Europe who provide most of the hard currency exchange for Belize and who have fueled the engines of growth in Belize for many years.

If these guys see Belize as an unstable place, it would have a major impact on Belize’s future.

--Lan Sluder
www.belizefirst.com
_________________________
Lan Sluder/Belize First
http://www.belizefirst.com

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#96098 - 01/20/05 02:51 AM Re: Will it hit the fan?
Chloe Offline
OMG, I'll just book Vegas.
_________________________
Dare To Deviate

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#96099 - 01/20/05 03:32 AM Re: Will it hit the fan?
sandb Offline
"Yes, it does sound a lot like the United States under George Bush, doesn’t it?"
I think you shot yourself in the foot with that one. Nice discussion before and aft your introducion of left wing politics and their raelity of tax increases.
Stick to the impartial and well written travel views and experiences that are your hallmark. Otherwise, you've politicized yourself and marginalized your credibility.

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#96100 - 01/20/05 03:58 AM Re: Will it hit the fan?
RD Offline
sandb... perhaps you should re-read Lens post.... it starts "Opinion by Lan Sluder" Is he not entitled to his opinion? He is obviously very familiar with Belize and has given his opinion... he certainly has not marginalized his credibility.

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#96101 - 01/20/05 04:49 AM Re: Will it hit the fan?
BDinAZ Offline
OPINION:

A very good and informative piece Lan.

Frankly, I think "WE" will be in worse shape overall after another 4 years of the current regime.

One can't help but wonder how the current US policies have negatively impacted all of our neighbors to the South.
(and North, East, and West)

Like I said, just an opinion--only one of 53+ million US citizens like minded opinions.
(that were counted)

BTW-where can you buy Belikin in the states? I surmise it is not as easy to obtain as Red Stripe or the Mexican brews.

Peace.

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#96102 - 01/20/05 03:51 PM Re: Will it hit the fan?
rastapasta Offline
Rasta Pasta will be closed today

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#96103 - 01/20/05 04:28 PM Re: Will it hit the fan?
Mona Lisa Offline
How about the airport? eek

We're arriving in Belize City tomorrow afternoon!!

Nothing like an adventure...

Thanks for the informative report LS.

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#96104 - 01/20/05 04:43 PM Re: Will it hit the fan?
ChrisW Offline
From Channel 5 news:

--SNIP--

Dylan Reneau, President, P.S.U.
"Being a responsible union we have tried to work an agreement on how we will deal with that situation and we certainly will not shutdown any hospitals or any essential services. What we want to have is a token or a skeleton staff there to ensure that the services carry on. But still we want some of the members of those organisations to be out there to show a united front.”

Stewart Krohn
"Let's say air traffic controllers; they will be working? Planes will still land?

Dylan Reneau
"Yes, they will be working.”

Stewart Krohn
"Immigration officers at the airport and border points?”

Dylan Reneau
"Yes, a token staff.”

--SNIP--

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#96105 - 01/20/05 04:45 PM Re: Will it hit the fan?
Chris Offline
Water is off on Ambergris Caye. Electricity is rumoured to go off later today.

Belizeans are extremely angry at what they percieve to be the rampant corruption of the Prime Minister and his cabinet. They have seen various ministers and their friends amass millions of dollars in personal fortunes and now they are being asked to pay for this dubious activity with increased taxes.

I think the basic instinct of most reasonable people is to pay the taxes...but they'd like to see half of the government in jail for theft.

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#96106 - 01/20/05 05:00 PM Re: Will it hit the fan?
cracked up Offline
What the GOB is attempting to do is put unreasonable tax burdens on small, medium and large businesses within Belize. The large outside cos. doing business in Belize will not be effected do to their lucrative GOB sponsored contracts. The GOB is saying that these increases will not be passed on to the consumer.
Unlike the GOB, businesses within Belize
re-invest into their companies through improving services, new equipment, better wages for employees, ect. Positive growth will end if the projective GOB policies are not revised.
The current GOB has only invested in their personal portfolios. Finances for most public/community projects in Belize come from outside sponsorships/grants, not from the GOB.
There is zero comparison between the current U.S. Administrations policies and the current GOB policies. U.S. policies encourage the small/medium business. The GOB is getting more in line with many small African nations which I am very familiar with.
I have been working for a medium size Belizean owned co for 14 yrs. We have continued to grow, improve our services, add new equipment and improve the quality of life for our employees through increased wages and benefits. All these improvements come from re-investment. The money comes from no were else. If the GOB continues on it's current agenda, growth will cease. The quality of goods and services will reverse in a hurry. All common Belizeans will be heavily effected.
Once again, Let's hope that the GOB takes note and revises their current agenda.
This is not meant to be a political forum, but someone decided that it was.

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