S & P downgrades Belize’s ratings in light of its tourism decline

Belize’s ratings on the global scale have been downgraded by S&P Global Ratings. S&P recently made revisions on several tourism-dependent countries including Belize and subsequently gave a CCC rating on the country’s long term foreign and local currency sovereign credit.  Belize was at a B-minus with a negative outlook status prior to this revision.  Belize’s ratings were also downgraded from a B to C on its short term foreign and local currency ratings.  In the category of Belize’s transfer and convertibility assessment, the ratings went from a B-minus to a CCC-plus.  While the report acknowledges the fight of the Coronavirus pandemic which has led to a crash in the tourism sector with a heavy impact on the country’s economy, S&P cited other factors contributing to this downgrade.  S&P wrote, quote, “Belize’s creditworthiness is constrained by institutional weaknesses that include a track record of the poor capability to maintain sustainable public finances across administrations.”  End of quote.  The rating agency estimates a contraction of 4% in 2020 and net general government debt at 97% of GDP.  The rating agency’s base forecast for tourism in the Caribbean and North Atlantic involves a slump of 60%-70% in the final three quarters of 2020 compared to a year ago, significantly impacting economic growth and fiscal accounts this year.  Other countries assessed were Jamaica, the Dominican Republic, Aruba, and the Bahamas.