BELIZE ECONOMY SHRINKING BADLY - (MINUS 3.5 GDP)

- Minus 3.5 GDP ( negative GDP for BELIZE )

It is certain that our economy is contracting. It has been doing so, since the PUP were in office during their last term. All is not negative however.

There have been some innovative investments in venture capital on the local scene by the private sector. Primary among these would be the BOWEN Wartisila diesel electric power generating plant down in the Placentia area and the Bagasse electric producing plant, to come on line in six weeks in Corozal by BSI and first promoted by Peter Singfield an engineer living in XAIBE in the Corozal district..

For a small population we are not doing too bad, all things considered. There is a lack of new innovative products for export, but that may more be the lack of experience, imagination and simply lack of entrepreneurial personnel. We also lack any kind of venture capital firm, to buy shares in start up hopefuls. Thus giving them funding. The borrowing loans system doesn’t work for pioneer type new businesses.

If you take out the Belize government run by foreign loan borrowing system of the two political parties, in which they have now sold out the next forty years of tax revenues expected to be generated, the – minus – 3.5 GDP sounds even optimistic. The contraction in the Belize economy is still definite and mostly lies on the heads of the PUP when they were in office, when they invested all their energy and marbles, into a one business driven economy ( tourism ), instead of budgeting investment hours and money into different segments of growing a diversified economy. Nothing has been invested yet in manufacturing industry pilot projects. Except for a little bit of cottage industry type efforts by TAIWAN, with their odd bit of food processing machines for demonstration and education, one couldn’t say anything has been done from the standpoint of investing in a diversified portfolio of economic possibilities. Nobody has started teaching machine lathe work to 1/10,000 tolerances for example. Some sort of government budget priority, allocating investment ideas by the government and support hasn’t even been broached yet. The politicians that we have are simply waiting for the private sector to take the lead and absorb the failures that come with such pioneering experimentation. Of course, in a LOAN financed government, there is a lot of activity going on, but this is more orientated to providing work through loans and grants for civil servants to spend, with the usual reports and accompanying jargon justifying the expenditures. Usually this is poverty fighting, or some other latest fad held by the senior bureaucrats. Sometimes these things are to the good, but mostly it is wasted money. increasing our long term debt.

We would need a boost in GDP from private sector, productivity ( not foreign loan borrowing ), of around $2 billion extra to handle the debts these two PUP and UDP governments have given us, as a burden. A veritable chain and ball hung around the neck of the private sector, holding us back We would also need this needed $2 billion extra GDP growth, in the next fifteen years, which is unlikely. Bureaucratic civil service experimentation and pioneering rarely works. Bureaucrats and politicians by their very nature are followers, not leaders.

I’d like to see a prize of $ 150,000 offered by our government, to the first cottage industry manufacturer of a security guard, automatic shotgun, manufactured in Belize. Such product destined for export to Guatemala, Mexico, Salvador and Honduras. Eventually to all of Latin America and the security guard firms that buy them. Can’t do that, until the UDP wipe out the legislation, that Musa and the PUP put in place, making such manufacturing activity illegal. No sign of that yet, though legal business and law suits are a GROWTH INDUSTRY provided by the UDP and the PUP. Unfortunately the lawsuit business is an internal small market and of little use for our GDP expansion that we need.

It is somewhat prohibitive trying to start a small business in Belize. The bureaucratic red tape is time consuming, expensive and adds oodles of costs to entrepreneurs. Mostly the biggest thing is the lost productivity used, in traveling back and forth to government offices trying to complete paper work. We are a lot like INDIA, for bureaucratic red tape and obstructionism from our civil service. When you figure a small start up, has no employees, then the bureaucratic red tape takes on a new dimension in very expensive, lost productive work hours. Very discouraging! The letter to the editor, by Juan Ramon, in the Amandala newspaper of the 22 nd of November said it all. Most small marginal home businesses are closing shop, choked by the bureaucrats and the regulations. Not so much the taxes, just the paper work and civil servants inadequately trained to know how to interpret the laws, that define how businesses can be run. Myself, I am just such a small home business type person, but we are now out of the Tourist Business and have also canceled any future small scale real estate construction speculation in Belize. We might do it over in Guatemala in the near future, but not in Belize, due to the Building ACT, which is actually worse than that we have had experience with in Florida, which is really bad. On the other hand, we are looking forward to a new business pilot program, now encouragingly under way, to be done in Chicago, USA and are gratified that all we have to do is sign a half a dozen forms, pay a flat capital gains tax of 28% and we are home free, to do what we want. Too bad the US Federal government will get the taxes and the side effects of employment, but c’est la vie! You go where business is encouraged. This may help our national GDP a little bit, as we bring back into the country foreign exchange to spend on living costs. This government is predatory by nature and so is the civil service bureaucracy. Consequently, until they learn how to make ways to encourage investment, the party and bureaucrats in power, can only see the GDP shrink.