IMF Says Haada Times Di Come!

Barrow is living in a wonderland while Belizeans suffer from UDP haad times

Belize City, November 1st, 2011

The state of Belize’s economy has worsened, according to the International Monetary Fund.

The IMF carried out its Article IV consultation in Belize and in their findings released last week they did not paint a good picture of the nation’s economic state. The Barrow Administration was unable to maintain austerity measures, allowing the overall fiscal deficit to balloon from 0.3% to 1.5% of GDP.

Despite the recession and scarcity of funds in Belize, the IMF notes that the Government of Belize increased its spending and had a weak grant disbursement plan. The increased expenditure is puzzling to Belizeans, who have not seen any meaningful social or economic assistance from the Barrow Administration. With the poverty rate at 43% and unemployment rate at 23%, the socio-economic pressures faced by Belizeans are undoubtedly extreme. Yet Government has played no significant role in diminishing those pressures. This is why in its report, the IMF notes that “improvements in social indicators have been protracted”. Until Government’s expenditures support real social intervention, Belizeans will continue to feel hardships.

The IMF expressed concern about the “weak” investment climate in Belize. The Barrow Administration has suffered tremendously with the expropriation of two public utility companies. The private sector was opposed to Government’s actions, and especially since, compensation is yet to be provided for any of the companies taken over, even though one of them, Belize Telemedia Limited, was stripped away three years ago. This is bad for investor confidence, and the IMF explicitly called for “timely compensation to former owners of the nationalized entities”.

The IMF has also considered the expropriations unnecessary and risky, calling them “growing contingent liabilities”. They have warned that those liabilities could place an additional burden on public finances, especially since the matter is entangled in a web of litigation that is costly. While the IMF is likely referring to using taxpayers’ money for compensation, it is undoubtedly also referring to the Barrow Administration’s decision to use $70 million from public funds to buy into shares into at least one of the companies, BTL.

The Barrow Administration has shown more direct intervention in the dispute over the utility companies than on the issues faced by Belizeans. With poverty increasing, the IMF has called on GOB to “rebuild macroeconomic buffers” which are non-existent.

The IMF is recommending GOB to increase its tax revenue and to contain its wage bill. To the UDP this normally means brutally firing hundreds of Belizeans as they did in 1995, and have continued to practice every time they are in office.

Prime Minister Dean Barrow seems to be suffering an Alice-in-Wonderland complex, where everything is beautiful. His administration has hailed the IMF report as proof of what they call their wondrous work in Belize, but the truth lies in the nation’s dilapidated conditions. Not only is the economy on stilts, but so are hundreds of jobs, investments and small businesses. On a weekly basis, a business house shuts it doors and closes for good. Investment continues to be at its lowest in the entire country. This trickles down to hardships for Belizeans, because while the cost of living and basic food prices are going up, their wages aren’t.

It is time for PM Barrow to smell the coffee. He may be living like a King, but he has Belizeans living like animals. We don’t need the IMF to tell us the economy is on life support. The single mothers and hardworking fathers can readily tell you: life haad out ya Mr. Barrow.

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