Belizean Businesses Losing Money

Report 20% Decline in Revenues

On Monday night on Love FM during the Chamber of Commerce’s weekly show called The Business Perspective, guests revealed that the productive and commercial sectors were losing about 20 percent of revenues across the board.

This show, which was titled the “Business Round Table (weh we di feel),” featured the host and her 3 guests, who were all prominent Belizean Businessmen from the productive and commerce sectors in Belize. During the discussion the panel stated that the recession, which is now in full swing, is really having a serious effect on the ability of the business owners to keep operating at a profit.

With inflation on the rise and consumer spending on the decline, businesses are finding it more difficult to access affordable credit or to properly manage their cash flow. In some cases, businesses have drastically slashed orders because of the fear that people will not be in a position to start spending anytime soon.

In addition, some businesses are struggling to remain open.   In fact in the Corozal Free Zone, where the losses have been significant, a number of businesses have already closed down, and some people are speculating that a number of companies will only remain open until the end of the Christmas Season and then will be forced to close doors.

In Belize City, prominent and well established businesses have suffered under the impact of this recession. Last week the Belize Photolab closed down and already it has been announced that the Belize Glass Shop will be pulling down its shutters permanently in a few week’s times.

In the meantime, many of the businesses plan to weather the storm as long as possible by layoffs and cutback in staffing hours.  On the Chamber of Commerce Show one of the panellists commented that he was doing everything possible to try not to lay off workers, but this now seems inevitable.  He said that in an effort to minimize the effects of layoffs companies are trying to protect their most skilled and efficient workers, however it is becoming increasingly difficult to maintain this position, even though losing these workers will mean having to give up on people with many years of training and skills.

In every aspect of the Belizean economy the recession is taking its toll; in the service industry the tourism industry got off to a slow start and some hotels are still not comfortable enough to return to full staff.  In agriculture, leaders in the industry continue to complain about the rising cost of inputs and have been asking the government to consider removing GST on their inputs.  In the import sector the situation is further exacerbated by what appears to be a shortage of foreign exchange.  One business person who spoke to the Belize Times on the condition of anonymity indicated that in some cases it can take up to two weeks for clearance for foreign exchange.  Add to this the fact that there is a shortage of affordable financing and the situation for everyone seems more dismal each day.

The last recession hit Belize in 2003.  Under the PUP the matter was addressed and the government was able to maintain investor confidence and come up with a number of measures to ensure that businesses were able to survive.  In the first place, Government cut excessive spending and made sure that affordable credit was available to the productive sector.   Foreign assistance from friendly countries like Taiwan were focused in areas that would stimulate economic growth instead of using these funds entirely for budget support.  In the end the recession was brief and the economy rebounded.

The difference between 2003 and 2009 is that in 2003 the PUP Government was able to implement plans to deal with the problem head on.  It seems that in this current situation that the Barrow Administration has no idea of what to do about the situation.  Such is the level of desperation that on the Business Perspective one of the panellists begged listeners to call in with ideas on how the matter can be fixed, stating in frustration that there seems to be no plan to get the country out of this serious situation.

Another panellist, looking for some glimmer of hope said that as far as he is concerned, the only light at the end of the tunnel seems to be that old adage that “Christmas bring with it its own money.”

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