 International Monetary Fund |
An International Monetary Fund mission led by Gerardo Peraza wrapped up its yearly review of Belize's economy in the context of the IMF's Article four consultations on Thursday. In a statement issued yesterday Peraza reported that Belize is experiencing an output rebound despite the decline in oil production.
In 2012, real Gross Domestic Product growth is expected at three point five to four percent, led by a recovery from last year's effects of weather-related damages in commodity exports as well as a recovery in tourism, and electricity generation. Inflation, which stood at one point five percent in January to August, has been easing as commodity prices pressures abate. The current account deficit is expected to narrow to two point three percent of GDP down from two point five percent of GDP in 2011. This is attributed to higher inflows from tourism, lower repatriation of dividends by foreign companies operating in Belize, and higher remittances, despite a moderate widening of the trade deficit in goods.
The report goes on to say preliminary fiscal data suggest that the government's primary surplus target of two percent of GDP is within reach but will require a close monitoring of spending for the remainder of this fiscal year. In light of ongoing negotiations with bondholders on the restructuring of the "super-bond", further discussions with the authorities are required to complete this year's Article IV consultations. Talks are expected to resume in the near future.
Discussions so far have been focused on fiscal sustainability, external stability, and policies to enhance the financial sector resilience. In parallel with the Article IV consultations, a technical assistance mission assessed the current framework for debt management and helped the authorities build relevant institutional capacity. The IMF team was in Belize from November first to the fifteenth.
Belize is experiencing an output rebound, despite a decline in oil production, according to the International Monetary Fund, which just concluded its yearly review of the country's economy.
According to the fund, Belize is expected to see GDP growth this year of between 3.5 and 4 percent, led by a recovery from last year's weather-related damages in commodity exports, along with a recovery in tourism and electricity generation.
An IMF mission led by Gerardo Peraza visited the country from Nov. 1 to Nov. 15 to conduct the review, which came in the context of the IMF's Article IV consultations.
Belize's current account deficit is projected to narrow to 2.3 percent of GD, also thanks to higher inflows from tourism, along with higher remittances and lower repatriation of dividends by foreign companies operating in Belize.
The fund said that, according to preliminary fiscal data, the government's primary surplus target of 2 percent of GDP is also within reach, although that will require a "close monitoring of spending for the remainder of this fiscal year."
"In light of ongoing negotiations with bondholders on the restructuring of the 'super-bond,' further discussions with the authorities are required to complete this year's Article IV consultations," Peraza said. "Discussions so far have been focused on fiscal sustainability, external stability and policies to enhance the financial sector['s] resilience."
Talks are expected to resume on the bond in the near future.
During the mission, a technical assistance mission to Belize examined the current framework for debt management and helped the authorities build "relevant institutional capacity," the fund said.