BELIZE’S ECONOMY REBOUND FROM A BAD FIRST QUARTER

September 12, 2008

Belize’s economy has seen an increase. That is according to figures released by the Statistical Institute of Belize.  A release from the Institute says after virtually no growth in the first quarter of this year, Belize’s economy bounced back at seven point three per cent in the second quarter to post growth of an estimated four per cent in the first half of this year. The expansion was spurred by the wholesale and retail trade and manufacturing sectors, both of which grew by more than 10 per cent. After the collapse of the country’s largest shrimp farm, the fishing sector declined by 20 point five per cent however it rebounded in the second quarter making it the third largest contributor to the expansion of the economy during that period. Growth was also recorded in the agriculture, transport and communication sectors.  On the downside the hotel and restaurant sector declined for a second consecutive quarter. This reflects the continued decrease in tourists’ arrivals. The electricity and water sector also reflected a decrease. This was attributed to the lower rainfall at the Chalillo Dam which resulted in a 23 point four per cent in electric power generation. As it relates to the international merchandise trade, from January to July Belize imported 990 point three million dollars worth of goods; this is an increase of 24 point five per cent or 194 point eight million dollars from the same period last year. The most significant spending increases were in machinery and transport equipment which increased by 73 point eight million dollars. Manufactured goods increased by 40 point eight million dollars and mineral fuels and lubricants increased by 31 million dollars. The United States continued as the largest supplier, providing almost 34 per cent of total imports. Central America ranked second with 21 per cent most of which were for the Commercial Free Zone in Corozal. Domestic export earnings rose by four point nine per cent to 367 point seven million dollars. The bulk of the increase was due to higher oil prices. Among the other major export commodities, only marine products and bananas saw increased sales. Figures show that when crude petroleum oil is excluded, there was a nine point two per cent or 25 point seven million dollars shortfall in domestic export revenues between January and July. In value terms, the share of domestic export sales to the United States of America remained at 30 per cent while the percentage to Central America rose from 19 point nine per cent to 29 percent. The share of sales to Europe fell from 37 point seven per cent to 31 point seven per cent. As it relates to consumer price index, figures show that in May of this year, consumers were paying six point nine percent more than they did in May last year for goods and services in the consumer price index basket. This 12 month change is the highest recorded since August 1996 when consumer prices grew by seven point four per cent. The most significant increases were in the prices of food and beverages which rose by an average of 12 point three per cent. The price of rice went up by 21 point three per cent while the cost of flour and whole chicken increased by 51 point five percent and 13 point four per cent respectively. Increases were also recorded in the transport and communication sector as gasoline rose by seven point eight percent per gallon and diesel by 35 point four per cent per gallon.

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