A nation in crisis! Belize is on the verge of heading from tatters to ruins with impending tax hike!

Belize Economic Collapse

Every modern nation has experienced its unpleasant share of economic woes in the practicing of its own form of economic model. Belize is no different and at this point in time, the nation is experiencing its worst economic period in its history. This is as a result of shear incompetence and economic mismanagement starting from the period of Spring 2008 to present, under the United Democratic Party administration led by Dean Barrow the Prime Minister. During this time there has been a series of economic policies that have not been in favor of the Belizean people.

These policies, instead have served to enrich cronies and supporters of the United Democratic Party at the expense of YOU the tax payer. Belizeans are being fed the spoon to consume the notion that the national telecom would be for us Belizeans, however; it is used to facilitate job positions for family member of the upper echelon of the United Democratic Party. Belizeans were left to burden with the $550,000,000 cost of a company that they have yet to see the fruits of, having such a company under public control. As a result of that , nationalization has occurred followed by subsequent nationalizations of other private entities under the guise “for the people”. In effect the government sent a chilling message to foreign investors that Belize is a state where the right to enterprise is not respected. The government uses its power to arbitrarily take over without any warranted cause or whatever foreign investment that seems lucrative without immediate and proper compensation. This type of arbitrary actions by government has resulted in the sharp decline in the foreign direct investment that the country was traditionally enjoying up to the end of 2007.

This has injected a foreign capital of about $450,000,000 compared with the gloomy depressed projection at the end of 2016 which is next to nothing. The UDP government under Prime Minister Barrow has failed Belize and Belizeans because of their arrogance. It may be possible that ignorance blocked them from grasping that FDI (Foreign direct investment) was fundamentally essential in order to successfully service the nation’s foreign debt and to provide necessary funds for national development projects. The UDP government Under Prime Minister Barrow has been blinded and misguided by their arrogant drunken power arbitrarily abusing and feeding off the Petro Caribe Funds which was intended for the realization of genuine national development. This has instead been manipulated by Barrow to finance political pet projects using cronies as middle men to sap the funds (for electioneering purposes) which has resulted with poorly developed projects and infrastructure. Government’s wasteful spending came to a startling halt at the end of 2015 when money eventually ran out. Barrow’s mismanagement and myopic poor economic policies became more and more evident while Belizeans were deceived into believing “The Best is yet to come” were caught in disbelief with their pants down. As the year 2016 began progressing, Barrow’s government began to experience pressure on its looming collapse. Just about all major industries started to show loss and under performance starting with the closure of the Papaya industry which moved away to greener pasture market, then the gasping Citrus, Banana and shrimp farm industries started begging for government bailout but government was broke and needed bailout themselves. And to top it off, the last drops of crude oil was being squeezed out of the Never Delay oil field with no more incoming revenues to Belmopan.

As 2016 proceeded into August, Hurricane Earl smacked us across the country as a category and left with a destruction trail and damages with a cost in excess of $200 Million dollars at a time when Prime Minister Barrow was already running around like a chicken without head. Well this event was a wakeup call which prompted him to start sapping and squeezing every corner of government spending in order to begin paying for his dumb and indecisive arrogant actions. He already had to make good on first payment to the Ashcroft Alliance for superciliously seizing of the BTL telecom six years ago. With regards to BEL, he was forced to return part of the ownership of the BEL Electric Company because simply put, his government was outright broke and had no money to even continue with any kind of litigation with Fortis. So, that was the beginning of the end to Barrow’s arrogant style of leadership and his traditional high profile of high handedness. His wasteful spending was dragged down into low profile even though his deception of the Belizean people continues. As we know, he is faced with payments for the Super Bond valued at hundreds of $ millions of dollars of national debt bundled up to 2008. In 2012, Prime Minister Barrow named so-called financial guru Mark Espat to be Finance Ambassador regarding the Super Bond to which Prime Minister assured the nation that they had successfully negotiated and boasted that his government was now at a controlling point in their capability to pay every jack cent. He even noted that Ambassador Espat’s negotiation had saved the nation $millions of dollars which ended up as payment for Espat’s services in the end. Sadly, as we grind into 2017, once again Prime Minister Barrow finds himself in the same quandary renegotiating all over again since his government is unable to meet service payments to the Super Bond.

We must recall that around the same time in 2012 while Barrow’s financial Guru was allegedly making some head way with the Super Bond. Barrow and his government embarked on a full-scale reckless lavish spending of $400 plus millions of Petro Caribe Funds to buy their Party’s way into a second and third term of government without realizing that added to the hundreds of millions of dollars that the UDP has borrowed since 2008. They have created another Super humongous national debt without being cognizant that it’s payback time. Now, Barrow is stuck in a quagmire apart from not being able to service its foreign debt commitment that was established up to 2008, his misguided decisions and policies have taken the national debt to higher heights and by the time this term is over, the total national debt will be doubled. The Government is now broke, no incoming revenue from FDI, clearly nothing of substance from Belize’s ailing domestic industries. It is uncertain if it's possible to continue the basic flow of government spending, according to his 2017 New Year’s Speech, he seems so pompously proud to have squandered the pot of gold he dubbed as Petro Caribe and the few things achieved by it. Now, the deception continues, even while the IMF is demanding that his government cut down on the public wage bill, meaning that retrenchment is right around the corner, many social programs will be slashed or obliterated. He is deceivingly telling the nation that in a few months this New Year things will be turning around like magic.

The price of doing business is very high, municipal taxes are already going up, Driver licenses, Vehicular licenses , even to check your car before renewal of licensing comes with a fee, Trade Licenses.Government will soon announce GST increase to 15% which will continue to bleed the working class, everything is sky rocketing while wages for the common man has been at a standstill for over 15 years. Programs such as small entrepreneurial assistance and other poverty alleviation to the poor will be stopped. You might have noticed that there was no Christmas cheer program; Still, Government continues to shaft the people with the erratic raising with the price of fuel when prior to 2008 the price for Oil was at a historical low. Now, instead of giving the people a break, this Barrow Administration has decided to continue in his bleeding of the Belizean people while their Ministers continue to buy new cars and pay for their mistress’s apartments and wellbeing. There would be huge government deficit for the upcoming 2017 -2018 National budget as usual. However, any increase of the tax regime will totally destroy what is left of this ailing economy. Now that the government is attempting to cover up the execution of the Belizean economy, they are about to print $1,000,000,000 when it is known that Belize does not have the reserves in the international markets to finance such printing of monetary bills. If Barrow proceeds with his plan to increase taxes his action will totally eliminate capital injection as soon as it enters the economy and it would perform as a double tax depreciating the purchasing power of the consumer; like a hidden devaluation in lay man terms. It is inevitable that things will get worse before it gets any better under this government. 2017 will bring a lot of unpleasant surprises for the Belizean people, the people must awaken and open their eyes NOW.