The Belize Business Bureau has endorsed Prime Minister John Briceno’s commitment that the Government’s planned 5-dollar minimum wage is coming in January. The bureau, a productive sector group, says that it welcomes the PM’s Independence Day announcement because quote “it will give struggling families a fighting chance during these uncertain times” End quote. President Arturo Lizarraga says that raising the minimum wage will allow for more money to be spent on the economy.
Arturo Lizarraga, President, Belize Business Bureau: “We saw that it made sense, yeah, and it wouldn’t affect as much the productive sector because it’s something that these people did to retain their workers in order to continue being productive. And I understand that a lot of merchants represented being part of the import distribution sector might have been comfortable with giving people less than $200 a week but those are slave rates. You know, people, the risks today. Cost of living is so high. Inflation. Right now we’re having this crisis in Europe and it’s going to get worse in November and the housing market is looking for a correction. A 30% correction and the rate is at the highest it’s been in 30 years. It’s at the same place where it was in the 2008 crash. So people need to eat. They need to be a part of the productive sector even as workers. They need to be able to participate. You can’t have more than half of the population hungry. So it makes economic sense. To some importers or people in distribution it may not make specific business sense but on the global scale it makes economic sense to increase the rate to give people the ability to get to work, to pay their children’s school lunch etcetera, etcetera. That’s one on the humanity end of it, it also makes sense and delaying it won’t help us. In fact one of the arguments we’ve had with the administration is you’re taking too long and let’s go with the other incentives that they’ve offered. If we are not allowed to take advantage of the liquidity in time, it will dry up.”
Another important business group, the Belize Chamber of Commerce and Industry said earlier this year that the plan should be implemented in phases. Lizarraga explained to us today why he feels the country has already gone past a phased approach.
Reporter: How do you respond to the criticism that perhaps we might need to phase in this thing simply because of the volatility that exists in the Belizean market?
Arturo Lizarraga, President, Belize Business Bureau: “I totally disagree and no myself. There are a lot of people who disagree with a phased in approach. That would have been good two years ago. We’ve passed that water mark long ago. The water is up to our nose. So that argument, that’s an old, “the old crusp” that I call the old importers within that group who maintain a strong position and a stronghold and therefore, they are influential within the committee, within the presidential round in their organisation. But I am almost certain that there are people within their group that are sympathetic to a raise or who are fearful of the economic consequences of not having people earning proper wages. While they might not be vocal, there exists some people within their own organisations that feel that way. So we don’t share the same platform in terms of the $5 an hour and you have to understand that there are mostly importers and people who have distribution houses. So, what we have to start getting a reflection, and I’m glad that some people who have been very vocal, the Minister of Education, the Leader of the Opposition. There are lots of people who have been very vocal at this transition point with the death of The Queen and a reflection as to should we remain colonial? And being an importing country, the tax system is designed to assist importers. And therefore, we find that this importation or this tax system of a colonial tax system is no longer useful for us similarly like the Constitution. It’s a colonial constitution and it has to change. And the economic makeup, the way we design our economy has to change and this is part of the process.”
While the Belize Business Bureau is happy that the minimum wage promise will come to fruition early next year, that amount is not where we should be.
Reporter: Is $5 enough?
Arturo Lizarraga, President, Belize Business Bureau: “No. I think ideally we should be at $6.20. With calculations based on the London – there are certain formulas that you use and that you can find what exactly it is your economy deserves to offer and so $3.10 US is what we should be, where we should be at. Especially since our economy has grown because of tourism, the service sector has become an increasingly dominant sector. I’ll give you an example. The Statistical Institute was trying to do surveys and they ran into a huge problem because there wasn’t enough employees because the BPO’s took up all of the type of employees that they would normally use for their interviews. So the service economy is playing a big big role and the service economy is pushing up the salary and the demands by people for that level of salary. So there are other factors that play into this equation. So $5 is just a start and so you know if we will want you to be realistic and calculate it by the numbers, we really should be at $6.20 but we are grateful for the $5 because I believe that it will help the local economy. Those people who will receive this money will put it right back because poor people tend to spend more of their budget on food and living costs so you know, I don’t even believe. In fact, I’m amazed that we’re arguing about this issue.”