By Richard Harrison
Today, on the eve of our 33rd year of INDEPENDENCE…. I kneel in service to deliver the STATE OF THE NATION address.
Instead of dealing with all and sundry, gifts and glory, today I take off my gloves to try to deal a death blow with the little strength I have left….to only ONE, but principal among the obstacles to the development of my country and people….who, deep in my heart of hearts, I believe aspire to greater INDEPENDENCE.
33 years ago, all the citizens of BELIZE pledged allegiance to serve the best interest of an INDEPENDENT nation among all free nations of the world….free from the shackles of colonial dominance and control….and to carve a new and more promising way for the greater and more rapid development of ALL its people. HIP HIP HURRAY!!
One of the most important challenges our young INDEPENDENT nation faced, was to move from a colony that served the masters by supplying raw materials at give-away prices and importing their finished goods and services at much higher prices….enriching the masters and enslaving the colonial subjects.
We aspired to be equals with all FREE peoples on earth….earning and living with mutual respect….with our integrity and sovereignty intact. GRAN APLAUSO!!
The leaders of our drive to Independence spoke eloquently of our need to produce more of what we consume, and of our potential to become the ‘bread basket of the Caribbean’….they spoke of ‘wealth untold’…..and the people believed, gave their full support…and put their shoulders to the wheel.
BUT how could the country produce and export more relative to what we import, if the law which is the ‘gate keeper’ for the economy….the Customs Tariff Law….which controls what enters and leaves the country…was designed to achieve exactly the opposite?
Today our country imports close to BZ$2 billion and growing….and export only around BZ$0.65 billion, with non-oil exports declining since the turn of the century. We are consuming a lot more than we produce…financing this gluttonous consumption by debts that threatens to shackle and enslave us worse than we were in colonial times….so much so that we find ourselves crawling around with ball and chain on our ankles, with our palms upward.
The Customs Tariff Law requires payment of prescribed rates of import duty on items being imported into the country, including on inputs required for production of goods and services within Belize…and the ‘development concession’ under the Fiscal Incentives Act exempts the particular beneficiary from paying those import duties. In other words, the ‘development concession’ is an instrument under one law…the Fiscal Incentives Act….created for the sole purpose of…..you guessed it…..circumventing another law…the Customs Tariff Law….which was fully well known, recognized and acknowledged to be a principal obstacle to our development.
This law, which is still very largely in the way it was ‘inherited’ from our colonial masters… in some cases charge higher import duty on input materials than on finished products made from them….completely the opposite of what is needed if we are to make many more products and services here on a competitive and profitable basis. At the time the colonial masters drafted the law, Belize was a colony playing the role of exporter of raw materials and importer of finished products for consumption from the motherland….it was drafted to achieve THEIR objective.
The new local leaders of our INDEPENDENCE could have killed the culprit there and then…..by overhauling the Customs Tariff Law to reflect our new objective as an INDEPENDENT state…reduce import duty on inputs for production, while increasing import duty on finished competing imported items ready for consumption….making it possible to turn a profit from producing more goods and services within BELIZE, and creating the many jobs that would be needed for its growing population. That would have allowed every person to produce whatever was within their willingness and ability to produce. Belize would be a very different place today….
BUT NO….that would have freed all of the slaves….every man free to produce and benefit from his production and productivity….advancing according to his merit, ability and integrity. THAT would have contributed greatly to growing our INDEPENDENCE.
SO THAT was obviously not the objective…..rather the objective was for a new set of ‘local colonizers’ to rule over the slaves….those goading us to INDEPENDENCE did not want the slaves FREE….what they wanted was to take the reins from the British colonial masters….that was the end-game.
HOWEVER….they wanted to produce and export more relative to what is imported….because they knew that is how the wealth of the country that they have dominion over would grow….but they wanted to do it in a way where those with the reins on government…..the new colonial masters….would still hold sway over the slaves….deciding who should win, and who should lose….guiding the shillings by law into the pockets of the chosen few….not leaving every man to advance according to his merit, ability and integrity….as rightfully expressed in our NATIONAL CONSTITUTION.
THEREFORE….they instead created another law….the Fiscal Incentives Act….which allows for privileged persons, who at the discretion of the one with the reins of government in his hand, can circumvent the Customs Tariff Law….making them exempt from paying the import duties required by the law for importing THEIR particular set of inputs for THEIR production. Those who are privileged win…..those who are not lose.
HENCE….the Customs Tariff Law…..and its bastard sister…the Fiscal Incentives Act….can be deemed to be UNCONSTITUTIONAL in their present state….because they do not live up to this basic tenet of our NATIONAL CONSTITUTION….that advancement of citizens should be based on merit, ability and integrity….and not based on nepotism, favoritism and politically discretionary privilege.
THUS…the very thought of offering a ‘development concession’…..to encourage more production and export…by circumventing the payment of prescribed import duties…..is an acknowledgement that the Customs Tariff Law is flawed….and is an obstacle to development.
SO….why not remove the obstacle to development? Instead of circumventing it in this way? It is because the slaves would all be set free….and clearly that is not the objective….that is a heaven reserved only for a chosen few.
Not only that….but why give 1-year , 2-year or 5-year development concessions as being practiced? Which capital investment can be financed over such periods? The new local colonial masters not only wanted to hold unto the reins…..they wanted to hold on to the reins TIGHT. The investor slave has to come kneel to his master every year or two…..certainly before the 5-year election cycle comes to an end.
One of the false premise held by many….is that a development concession should last for only a short period…that the beneficiary should at some point be able to go on with his business without it. How can this be, if the law which was the chief obstacle to the business in the first instance, is still in place? Dreamers paradise…
33 YEARS AFTER INDEPENDENCE….FREEDOM FROM THIS SLAVERY IS STILL NOT THE OBJECTIVE….IT CERTAINLY IS MADE OBVIOUS BY THE RELUCTANCE TO MODERNIZE OUR CUSTOMS TARIFF LAW AND DO AWAY WITH POLITICAL DISCRETION OF CHOOSING WINNERS AND LOSERS THROUGH SO-CALLED ‘DEVELOPMENT CONCESSIONS’.
WE ARE INDEPENDENT IN FICTION AND FANTASY…..COLONIAL SUBJECTS IN FACT AND REALITY.
LET US TODAY RECOMMIT OURSELVES TO OUR GREATER INDEPENDENCE….ACTING IN THE BEST INTEREST OF ALL OUR PEOPLE….LET US OVERHAUL THE CUSTOMS TARIFF LAW…AND DO AWAY WITH ITS BASTARD SISTER….THE FISCAL INCENTIVES ACT.
LONG LIVE BELIZE. QUE VIVA BELICE.
This article was written by Richard Harrison, Belizean investor in production and services businesses in Belize. He holds a Masters in Business Administration degree from Lancaster University.Patrick Jones