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Financial Secretary Joseph Waight comments on Belize’s IMF Situation

An international news agency has described Belize as a serial defaulter on its bond payment. 

An international news agency has described Belize as a serial defaulter on its bond payment.  The statement comes amid a report that the International Monetary Fund (IMF) is holding virtual talks with the Government of Belize as part of its regular review of the country’s economy.  A point to note in the article is that according to the IMF’s Mission Chief to Belize, Jaime Guajardo, Belize has not requested the implementation of an IMF Program, and talks are expected to conclude next week.  According to an international publication by Reuters News Agency, Belize was in the doldrums long before measures taken to curb the spread of the novel coronavirus decimated tourism.  Belize is currently facing a debt to GDP ratio of over one hundred and twenty percent.  IMF has predicted that Belize will default on its bond payments in May.  The article goes on to note that with the plans by the Briceno administration to stimulate the economy, it would prove challenging for Belize to balance those plans if the country opts to enter the IMF Program.  Love News spoke with Financial Secretary regarding the meetings with the IMF.

Joseph Waight, Financial Secretary of Belize: “I don’t think the government is intending to sign on to a formal IMF program. It has stated that it will try to do its own home grown which would follow pretty much what an IMF program would entail and by that I mean you know we’re in a difficult situation, our economy is contracting, we have a big debt problem, we have a fiscal imbalance and essentially what we’re trying to do is put together an economic recovery plan which will address those issues and which would in a sense help to try to stimulate growth and rebound. There’s a lot of uncertainty in the future, we don’t know for instance when the tourism will rebound we’re hoping it will be soon now that the vaccines are being rolled out and that may encourage people to travel but essentially even now things are very slow and the government plan would be to try to stimulate the economy as best we can but at the same time trying not to increase our deficits any further and also to increase our debt any further because we have a debt problem.” 

Since its independence Belize has only engaged in the IMF program on one occasion.  The IMF program is tailored for countries whose economies are in crisis mode.  Aside from financial aid, countries who enter the IMF Program would be expected to implement adjustment policies to restore economic stability and growth.  One of the policies more than likely would entail mass retrenchment.