S&P Keeps Belize at B-Minus as Debt and Energy Risks Weigh on Economy

S&P Global Ratings has kept Belize’s credit rating at B-minus for long-term borrowing and B for short-term borrowing, with a stable outlook. This means the country’s financial position has not improved enough for an upgrade, but S&P also does not expect it to worsen significantly in the immediate future.  Essentially, S&P expects Belize’s economy to continue growing, but slowly. Growth is projected at approximately two percent per year between 2026 and 2029, partly because tourism and the business process outsourcing sector are expected to expand at a slower pace.  The agency says electricity shortages, a limited workforce and Belize’s exposure to hurricanes and other natural disasters could also restrict economic growth.  S&P expects Government to spend more than it collects in 2026, creating a deficit equal to approximately 2.5 percent of the economy. Higher energy costs, limits on electricity rates, reduced fuel taxes and increased public-sector wages are among the pressures on government finances.  Belize’s debt is also expected to remain high at approximately 67 percent of the country’s economic output. S&P noted that salaries and pensions for public officers consume 41 cents of every dollar Government spends.  The agency also pointed to limited progress on pension reform, legislation to improve financial discipline and the creation of a fund to prepare for future Blue Bond payments.  Belize’s rating could be lowered within the next 12 to 18 months if an economic shock weakens government finances or makes it more difficult for the country to secure loans. An upgrade would require stronger financial reforms, faster economic growth and a reduction in the country’s debt and other financial risks.  S&P Global Ratings is an international credit-rating agency that assesses the ability of governments and companies to repay borrowed money.  Its ratings work much like a financial report card. Higher ratings suggest a borrower is more financially secure and less likely to miss debt payments, while lower ratings indicate greater risk to lenders.  Belize’s long-term rating of B-minus means the country can currently meet its financial obligations but remains vulnerable to economic, financial or external shocks. The stable outlook means S&P does not presently expect to raise or lower that rating over the near term.