PUP Predicted IMF Conclusions

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Updated: September 29, 2016

The Executive Board of the International Monetary Fund presented the Government with a list of proposed action to be taken in order to attempt at fixing the current economic situation which the report has described as being weakened.  Today, the Leader of the Opposition, John Briceno spoke on the IMF Report.  Briceno says that the Prime Minister is making decisions out of fear for the truth.

JOHN BRICENO

“We are not surprised, we are not shocked. We had been saying it. During the budget debate we said that the economy was in serious trouble. Here we have the IMF now is saying that we are in a recession and it does not look good in the near future. I don’t know where the Prime Minister is getting his numbers that by the end of this fiscal year that he is going to turn things around because if you would know better you can’t plant an orange tree and in six months you are going to have fruits on the street. It takes more than one year and the same thing when it comes with sugar, bananas, with all our export products that are under serious trouble we are seeing now that we have a deficit in our budget of 8% of GDP. When we were in government and the IMF and people in the unions and the people in the media went after us saying that we need to get our books in order we did what we had to do. We managed to cut down the expenses, we managed to tighten collections to ensure that we could collect what we needed to collect that by the time Mr.Barrow presented his first budget the deficit was under 1% of GDP. There is no plan with the present government so we see no out in this economic quicksand that the Prime Minister has put us in. He has devastated our economy; he has wrecked the Belizean economy. We had $375 billion dollars from Petro Caribe at 1% we could have used that money to help the productive sector, we have been saying that from early last year, that the productive sector needs fresh capital. Our cane farmers are paying 16% on their loans for them to be able to plant their sugar cane and now with the low prices we are getting they are barely making ends meet. In some instances they are not even collecting enough to be able to pay for the cutting and harvesting of the sugar cane.  But if we have low interest rates we could have paid off and then used that 1% monies that the government had to be able to help the cane farmers, the citrus farmers, to help the people in shrimp, to help our people in the bananas and to help people in the productive sector all across this country but we have squandered a great opportunity just for them to have a third term. They have a third term now and look at the mess we are in. It is unfortunate that it is we the Belizean people that will have to pay for it.”

A portion of the IMF Article IV report states, quote, “The economic outlook has worsened further since the 2015 Article IV. GDP is projected to decline by 1.5 percent in 2016, in part due to the damage inflicted by hurricane Earl, and average less than 2 percent in the medium-term, reflecting declining productivity, competitiveness and public investment. In the absence of a radical change in policies, rigid current fiscal spending, particularly the public sector wage bill, would fuel high fiscal deficits and add to the already high debt burden. Financing constraints would reduce public investment. The current account deficit would slowly improve due to a gradual recovery in major commodity exports, but would remain high, indicating a weak external position. This deficit, combined with remaining payments for nationalized companies and increased debt service, would reduce international reserves to uncomfortable levels.”  End of quote.