Gov’t Meets with Financial Stakeholders Over Potential Impact of US Tariffs

A meeting concluded this evening with financial stakeholders as it relates to the new tariffs being applied by the United States Government.  The meeting had representation from the Ministry of Finance, Foreign Affairs and Foreign Trade as well as Economic Development and the Central Bank of Belize.  Minister of State for Finance, Christopher Coye, was not able to give a definitive report on the ramifications on Belize’s exports to the US, but he did indicate that the sugar exports might not be affected.  This would not be known for certain until there is a sound grasp on what products the tariffs would be applied to.

Senator Christopher Coye, Minister of State (Finance): “This is at present an information and data gathering  process. We’re trying to understand the full particulars. I’m trying to get all the different perspectives when looking at the implications of the tariff. But that said, are engaging in an information, data gathering process, both on a bilateral and and on a multilateral basis through CARICOM. So the 10 % tariff is in effect the baseline tariff that would be applied to products that Belize let’s say exports into the US. So that’s, as we understand, there are certain exemptions, but more  in relation to petroleum items.  And like I said, we’re still trying to fully understand the scope and those discussions continue. But to the extent that they apply  to our exports and especially our key exports we have to look at  how we go about mitigating the impact of those tariffs and even consider what opportunities may arise. It’s something that is relative. If the baseline is applied across and to all countries, then relatively speaking, you are not in any worse off position so far as our experts are  concerned. From a relative standpoint where some might be exempted and others  are not then we have to look at how it adversely affects us. There’s a lot of uncertainty and a lot of moving parts. So it’s hard to just give you anything definitive at this point. Prior to this, work has been done or is being done in terms of what to expect, analyzing based on those expectations foreign trade has been putting in a lot of work on that score. From the macro level the central bank has been looking at this as well.  Now,  beyond that, definitely there have been discussions.  I believe there are expected further discussions on the multilateral level to CARICOM. As I understand it, there is a meeting, I believe tomorrow of CARICOM heads and I’m sure this will be an important agenda item.  April 9, there is also to be  a further meeting of CARICOM I think that would be more technical discussions and the US tariffs will be a key agenda item for discussion on that. In preparation for that, believe foreign trade is doing quite a bit of analysis and we’ll have those engagements with our key exporters to the US to appreciate what are their concerns and what advocacy they are looking forward to.”

As it relates to other areas in Belize that could be adversely impacted by the new US tariffs is the tourism sector.  Multiple international news media have reported a scale back of travel for those in North America due to the uncertainty in the economy.  Minister Coye spoke on this macro-economic issue indicating that he does not anticipate dire effects, at least not in the immediate future.

Senator Christopher Coye, Minister of State (Finance): “We spoke earlier about the potential  inflationary effects  that can have a macro effect,  but there are also the broader economic effects that could impact  on these sectors like the tourism sector. I wouldn’t want to make any  guesses as to what will be  the impact of these tariffs when in fact they haven’t even been implemented and we don’t know where ultimately they will land. So it’s early in the day to say that there will be an adverse effect on the tourism sector.  I do expect that, I don’t know if you’ve followed the  numbers on economic performance but last year  once again we outperformed the expectations the projections were around four percent we grew by over eight percent now the expectation this year is that there will be moderation we can’t grow at those rates forever there will be moderation but at the same time, our economy has been performing on a robust basis and we look forward to a healthy performance going forward,  not any kind of contraction.”

Minister Coye notes that with uncertainties and multiple elements to consider, the government is focusing primarily on the key exports to the United States which would differ from product to product.  As it relates to the sugar exports, Minister Coye noted that there is a quota which would remain in place but discussions will take place with the importers.

Senator Christopher Coye, Minister of State (Finance): “In the case of sugar, sugar being exported from Belize to the US you have a quota. My understanding is that quota remains in place. So that’s not affected. So there remains that trade that will continue for sugar. Plus you have, in effect, a related party exporting to another related party to the US. So in the case of sugar, we are having those discussions with the key exporter in that case and trying to get a better understanding of what will be the expected outcomes as it relates to the application of the tariffs.”

Belize was listed among the 185 countries that will see new tariffs imposed on its exports into the United States.  US President Donald Trump presented the list of countries yesterday which will be impacted by his new tariff regime.  For Belize, a ten percent tariff will be imposed.   In 2024 alone, Belize had exported some 102.58 million Belize dollars’ worth of goods into the US.  Currently, Belize’s majority of exported products are destined for the UK and CARICOM markets with the United States at the third highest.