WASHINGTON, CMC – The Govt Board of the Worldwide Financial Fund (IMF) welcomes the “robust restoration” in Belize following the COVID-19 pandemic, in addition to the improved social outcomes and monetary stability.
In an announcement following its Article IV Session for Belize, the chief famous that, after increasing by 30.6 p.c between 2021 and 2023, actual gross home product (GDP) grew by 8.1 p.c final 12 months, pushed by constructive developments in tourism, commerce, and transport.
On the similar time, inflation continues to reasonable, slowing to 1% in Might 2025 from 4% in Might 2024, owing to decelerations throughout most classes.
The IMF said that this robust nominal progress, mixed with expenditure management and a pointy restoration in authorities revenues, improved the first stability to 1.7 p.c of GDP within the monetary 12 months 2024.
In flip, public debt fell sharply to 61.1 p.c of GDP in 2024, after peaking at 103.3 p.c of GDP in 2020, additionally supported by a debt-for-nature safety swap and a negotiated low cost on the debt with Petrocaribe.
Actual GDP progress is predicted to decelerate to 1.5 p.c in 2025, primarily on account of a slowdown in tourism and a weak efficiency of the agricultural sector. It’s projected to step by step converge to its potential of about 2 p.c over the medium time period, absent growth of resort and flight capability.
The IM govt administrators highlighted that progress is predicted to decelerate sharply in 2025, earlier than converging to its potential over the medium time period.
Noting the draw back dangers stemming from excessive publicity to exterior dangers and elevated world uncertainty, they burdened the necessity to scale back public debt and speed up reforms to unlock potential progress and construct resilience to pure disasters.
The IMF officers said that, as a small growing nation with capability constraints, they agreed on the significance of continued, tailor-made coverage recommendation and technical help to help implementation in Belize.
They’ve additionally welcomed Belize’s dedication to constructing buffers towards future shocks, notably by decreasing public debt to under 50 p.c of GDP. They beneficial enhanced income mobilization and reprioritization of present expenditure, together with by pension reform, to create space for precedence spending on focused social packages, crime prevention, and infrastructure.
The IMF said that establishing a medium-term fiscal framework with clear targets and measures would improve credibility and pave the way in which for an efficient Fiscal Duty Regulation.
The IMF administrators agreed that continued reserves accumulation would assist strengthen the credibility of the foreign money peg. They stated additional fiscal consolidation, structural reforms to boost competitiveness, and continued efforts to cut back the central financial institution’s holdings of presidency securities are important measures.
Additionally they welcomed the decline in systemic dangers and inspired continued dedication and vigilance to take care of monetary stability. They emphasised the necessity to expedite the implementation of the Deposit Insurance coverage Act to strengthen the financial security internet.
The administrators additionally agreed on the significance of enhancing non-public sector entry to financing to spice up funding, highlighting the appreciable progress made in strengthening the anti-money laundering and countering the financing of terrorism (AML/CFT) framework, and known as for continued efforts to handle the remaining gaps.
