BELIZE’S TRADE POLICY AND SERVICE PROVIDERS AT ODDS

Over the past few weeks the tourism sector and more specifically the tour operators have been in a raucous over a company Chukka – Bakka Bush and their place in the market.  It is important in accessing the current relationship of this firm with Carnival Caribbean cruise line and the level of market share they have as a tour operator in Belize, that it is done taking into account what is the policy framework within which this sector functions.   Belize as a small open economy has a striving and well established service sector, which includes the tourism sector and its related services. In critically assess how this sector functions it is important to first understand the legal context; namely Belize’s trade policy with regard to trade in services.   This write will provide a brief synopsis with respect to the Belize’s trade policy and its services sector.

As a founding member of the World Trade Organization (WTO) and a signatory to the Uruguay Agreements, Belize’s commitments under the General Agreement on Trade in Services (GATS) was limited to only the telecommunication sector.  This meant that in 1993 when she became a member of the WTO, the only service sector that Belize agreed to liberalize and allow for foreign investment and competition was the telecommunication sector.   This was evidently achieved when the Belize Telecommunication Authority was privatized and became Belize Telecommunication Limited (BTL) and most recently the market has seen the entry of Speednet Communications.   Other services sectors such as tourism and all its related services did not see the level of commitment towards liberalization of trade.  However, due to the nature of how the Belizean tourism sector has developed over the years and the fact that it requires significant capital investments, one has seen vast levels of foreign investment in hotels, resorts, tour operators and other areas.  This de facto liberalization of the tourism sector is what has allowed for the high levels of foreign investment to be acceptable.

Belize’s trade policy in services is a direct reflection of her commitment as a party to the Revised Treaty of Chaguaramas that establishes the CARICOM Single Market and Economy (CSME).  The commitments therein under Chapter 3 allows for the establishment, provision of services, movement of capital and nationals within the Community.   Therefore, unlike her commitments under the WTO and other trading partners outside CARICOM, Belize is obligated to liberalize its trade in services with CARICOM member states.   This therefore, provides for foreign investment from within the region and movement of professionals and other persons to operate and provide services in Belize.   It is this trade policy arrangement that ought to be keenly examined to note the required waiver of obligations that would allow for the Government of Belize to determine the level of preferences and/or access allowed to Caribbean firms.

This writer did not seek to verify the nature of the ownership structure of the tour operator Chukka-Bakka Bush; however based on media accounts it is claimed to be 75% foreign owned by Jamaican interest.  This therefore makes it a Caribbean company established and operating in Belize.  The nuances and peculiarities of Belize’s tour operators and tour guide sector, is such that it caters and allows for the coexistence of small to medium size indigenous companies  to be established and operated.   Majority of the firms are 100% Belizean companies, be them medium to large size or the one-man operation by independent tour operators.   Therefore, with a market structure of this nature, it is of utmost importance that Government ought not to have allowed a foreign company with the capacity to dominate the market to establish and operate in Belize.   Especially since her trade policy has not allowed for the liberalization of its tour guide and tour operators sectors.   Under the Revised Treaty establishing the CSME, Belize as a member state has the right to request a waiver of obligations to rights granted under the Agreement, whenever the provision of such rights results in economic dislocation or hardship on a particular sector.   This is evidently the case with this dominant tour operator in the market place.  It is incumbent on Government to avail itself of the special provisions afforded to Less Developed Countries under the Treaty.   It is rather foolhardy of the Ministry of Tourism to see it fit to rationalize and legitimize the monopoly arrangement that Chukka-Bakka Bush enjoys with Carnival Caribbean cruise line.  The Belize Tourism Board (BTB) and the Ministry of Tourism has an obligation to Belizean tour operators and tour guides to ensure that the adequate standards for operations are in place and adhered to.  That’s where their responsibility lies.   Not to condone and accept an arrangement that proves disadvantageous to Belizean operators.   Furthermore, Carnival Caribbean cannot impose any monopoly arrangement for Chukka-Bakka Bush that is contrary to Belize’s trade policy regime.  Carnival has the option to indicate to their patrons a preferred operator, but visitors must have the right to choose which operators and guides they wish to use.  It is this level of oversight the BTB and the Ministry ought to place their focus on.

Therefore, this writer calls on Government to undertake its responsibility for the implementation of effective trade policy that benefits Belizeans.   Belizean companies ought not to be haggling for preferential treatment in their own territory, this ought to be a given especially in an area where indigenous expertise lies with Belizeans.  The dilemma that this sector now faces is simply a result of poor monitoring and oversight by Government through the designated entities; the BTB and Ministry of Tourism.  This is a situation that could have been avoided provided there was a clear road map on how they envisaged the expansion of the cruise tourism sector would be accommodated.   Government’s obligation is first to its people and the development of Belizean companies.   The Barrow administration needs to understand the role of Government in fostering Belize’s development; it is not only about winning elections.

Gwyneth Sydney Nah

Comments welcome at GwynethNah@gmail.com

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