Belize has the smallest economy in Central America, with a gross domestic product (GDP) of US $1.3 billion in 2021, a 12.5 percent expansion over the previous year. Due to mounting fiscal pressures and a need to diversify and expand its economy, the Government of Belize (GoB) is open to, and actively seeks, foreign direct investment (FDI). However, the small population of the country (2021 estimate – 432,516 persons), high cost of doing business, high public debt, bureaucratic delays, often insufficient infrastructure, and corruption constitute investment challenges. The Central Bank of Belize projects the country’s GDP will likely expand 6.0 percent in 2022 while the IMF’s projects 6.5 percent growth, led by a rebound of activity in the construction, retail and wholesale trade, transport and communication, and tourism sectors.
Public debt declined from 133 percent of GDP in 2020 to 108 percent in 2021. This was in large part due to the Blue Bond Agreement, a successful marine protection and conservation-driven financial transaction. International reserves increased from US $348 million (3.8 months of imports) in 2020 to US $420 million (3.9 months of imports) in 2021, partly due to the IMF’s Special Drawing Rights (SDR) 25.6 million allocation, which the authorities are keeping as reserve. Belize’s government encourages FDI to relieve fiscal pressure and transform the economy. The Central Bank of Belize recorded increased inflows of FDI at US $152.25 million in 2021 and outflows at US $24.4 million in the same period. FDI inflows were concentrated primarily in real estate, construction, financial intermediation, and the hotel and restaurant industries.
Generally, Belize has no restrictions on foreign ownership and control of companies; however, foreign investments must be registered with the Central Bank of Belize and adhere to the Exchange Control Act and related regulations. The Government of Belize (GoB) made progress on the ease of doing business through trade license, stamp duty, exchange control, and land reforms to streamline business applications and related processes.
The banking system remains stable but fragile. Since January 2020, a domestic bank and an international bank each lost a correspondent banking relationship, a significant portion of the sector. In March 2022, the GoB lowered the business tax on the net interest income charged to banks and financial institutions to encourage lending in strategic foreign exchange earning sectors such as tourism, agriculture, and the Business Process Outsourcing (BPO) sectors.
There were incidents of property destruction at two American companies involved in sugar cane industry in the last year. In response, a prominent agro-productive organization wrote to the Government in January 2022 expressing concerns that the Belizean government’s failure to protect and support private sector investors in these instances led to damaging the investment climate and the Belizean economy.
Belize is categorized as a small island developing state (SIDS) that is highly vulnerable to the effects of climate change and is a relatively minor contributor to global greenhouse gas emissions. Belize’s updated National Determined Contributions (NDC) is nonetheless committed to developing a long-term strategy aligned with achieving net zero global emissions by 2050.
|TI Corruption Perceptions Index||2020||N/A||http://www.transparency.org/research/cpi/overview|
|Global Innovation Index||2021||N/A||https://www.globalinnovationindex.org/analysis-indicator|
|U.S. FDI in partner country ($M USD, historical stock positions)||2020||USD 64 million||https://apps.bea.gov/international/factsheet/|
|World Bank GNI per capita||2020||USD 4,110||https://data.worldbank.org/indicator/NY.GNP.PCAP.CD|
1. Openness To, and Restrictions Upon, Foreign Investment
Belize’s government encourages FDI to relieve fiscal pressure and transform the economy. In November 2021, the Government of Belize hosted its first national Investment Summit under the theme “Belize: Open for Business.” The Government of Belize also conducted trade missions to the United States to promote itself as an investment destination and credible export market. In April 2022, senior Belizean government representatives hosted a diaspora tour in the United States to encourage Belizean-Americans to invest in Belize. The estimated Belize diaspora is 300,000 persons. While the government is interested in attracting FDI, certain bureaucratic and regulatory requirements impede investment and growth.
Public debt declined from 133 percent of GDP in 2020 to 108 percent in 2021. This was in large part due to the Blue Bond Agreement, a successful marine protection and conservation-driven financial transaction. Under this deal, The Nature Conservancy (TNC) lent funds to Belize to buy back its Superbond (totaling US $553 million or 30 percent of GDP) at a discounted price of 55 cents per dollar. In exchange, Belize committed to increase expenditure on marine conservation until 2041 and to expand its Biodiversity Protection Zones to 30 percent by 2026.
There are no laws that explicitly discriminate against foreign investors. In practice, however, investors complain that lack of transparency, land insecurity, bureaucracy, delays, and corruption are factors that make it difficult to do business in Belize. U.S. firms have identified challenges in participating and competing in areas related to the bidding, procurement, and dispute settlement processes, in particular relating to State Owned Enterprises (SOEs).
The Belize Trade and Investment Development Service (BELTRAIDE; ) is the investment and export promotion agency. It promotes FDI through various incentive packages and identified priority sectors. Export-orientated businesses operating in less developed areas also receive preferential treatment. The Economic Development Council, , is a public-private sector advisory body established to advance public sector reforms, to promote private sector development and to inform policies for growth and development.
Belize acknowledges the right for foreign and domestic private entities to establish and own business enterprises and engage in remunerative activities. Foreign and domestic entities must first register their business before engaging in business. They must also register for the appropriate taxes, including business tax and general sales tax, as well as obtain a social security number and trade license.
Generally, Belize has no restrictions on foreign ownership and control of companies; however, foreign investments must be registered with the Central Bank of Belize and adhere to the Exchange Control Act and related regulations. To register a business name, foreigners must apply with a Belizean partner or someone with a permanent residence. Requirements differ based on the applicant’s residency status and whether the individual is seeking to establish a local or foreign currency account.
Foreign investments must be registered and obtain an “Approved Status” from the Central Bank to facilitate inflows and outflows of foreign currency and repatriate funds gained from profits, dividends, loan payments, and interest. The Exchange Control Regulation Act was amended in 2020 to relax the requirement for non-residents to obtain prior permission from the Central Bank to conduct transaction in securities and real estate. The amendment now requires for prior written notice to the Central Bank with full particulars of the transaction.
Some investment incentives show preference to Belizean-owned companies. For example, to qualify for a tour operator license, a business must be majority-owned by Belizeans or permanent residents of Belize ( ). This qualification is negotiable, particularly where a tour operation would expand into a new sector of the market and does not result in competition with local operators. The government does not impose any intellectual property transfer requirements.
Foreign investors seeking to avail themselves of various incentives programs are required to adhere to screening guidelines outlined in the specific program. These may include updating their shareholders registry, obtaining requisite Central Bank of Belize approvals, and fulfilling performance requirements. Foreign investors undertaking large capital investments are also advised to adhere to environmental laws and regulations. The government requires developers to prepare an Environmental Impact Assessment (EIA) for certain projects. When purchasing land or planning to develop in or near an ecologically sensitive zone, the government recommends the EIA fully address any measures by the investor to mitigate environmental risks. The Department of Environment website, has more information on the Environmental Protection Act and other regulations, applications, and guidelines.
In the past three years, there has been no investment policy review of Belize by the Organization for Economic Cooperation and Development (OECD) or the United Nations Conference on Trade and Development (UNCTAD). Belize concluded its third Trade Policy Review in the World Trade Organization (WTO) in 2017.
In the past five years, civil society organizations concerned with investment policy lobbied directly with government. As an example, the Belize Chamber of Commerce and Industry, the Belize Network of NGOs, and the opposition were represented on the National Oversight Committee during the height of the COVID- 19 pandemic.
BELTRAIDE ( ), a statutory body of the Government of Belize, operates as the country’s investment and export promotion agency. Its investment facilitation services are open to all investors, foreign and domestic. While there are support measures to advance greater inclusion of women and minorities in entrepreneurial initiatives and training, the business facilitation measures do not generally distinguish by gender or economic status.
The GoB made progress on the ease of doing business through trade license, stamp duty, exchange control, and land reforms to streamline business applications and related processes. Myriad government services are going digital. Business and personal income tax offices amalgamated into the Belize Tax Service which launched an online tax payment system. Belize’s Financial Inclusion Strategy also expands access of financial services to underserved populations. Businesses must register with the tax department and local government to pay business and general sales tax and obtain a trade license. An employer should also register employees for social security. Permission from the Central Bank is required for all overseas investments between residents and non-residents
Belize does not promote or incentivize outward investments. The government does not restrict domestic investors from investing abroad. However, the Central Bank places currency controls on investment abroad, with Central Bank approval required prior to foreign currency outflows.
3. Legal Regime
There are no reports of government policies, processes, or laws significantly distort or discriminate against foreign investors. Nonetheless, some investors have complained of systematic shortfalls such as unreliable land titles and bureaucratic delays or corruption, which hinder doing business in Belize. U.S. firms have also identified challenges in participating and competing in areas related to the bidding, procurement, and dispute settlement processes, particular to State Owned Enterprises (SOEs). There are no nongovernmental organizations (NGOs) or private sector associations that manage regulatory processes. NGOs and private sector associations do lobby on behalf of their members but have no statutory authority.
Regulatory authority exists both at the local and national levels with national laws and regulations being most relevant to foreign businesses. The cabinet dictates government policies that are enacted by the legislature and implemented by the various government authorities. Some quasi-governmental organizations are also mandated by law to manage specific regulatory processes, e.g., the Belize Tourism Board, BELTRAIDE, and the Belize Agricultural Health Authority. Regulations exist at the local level, primarily relating to property taxes and registering for trade licenses to operate businesses in the municipality.
Some supra-national organizations and regulatory structures exist. For example, some elements of international trade affecting U.S. businesses are affected by CARICOM treaties, as in the case of the export of sugar within CARICOM.
Accounting, legal, and regulatory systems are consistent with international norms. Publicly owned companies generally receive audits annually, and the reports are in accordance with International Financial Reporting Standards and International Standards on Auditing.
The government does not promote or require companies’ environmental, social and governance disclosure to facilitate transparency or help investors and consumers distinguish between high- and low-quality investments.
Draft bills or regulations are generally made available for public comment through a public consultation process. Once introduced in the House of Representatives, draft bills are sent to the relevant standing committee, which then meet and invite the public and interested persons to review, recommend changes, or object to draft laws prior to further debate. The mechanism for drafting bills, and enacting regulations and legislation generally applies across the board and includes investment laws and regulations. Public comments on draft legislation are not generally posted online nor made publicly available. In a few instances, laws are passed quickly without meaningful publication, public review, or public debate. The government does not generally disclose the basis on which it reviews regulations. Some government agencies make scientific studies publicly available.
Printed copies of the Belize Government Gazette contain proposed as well as enacted laws and regulations and are publicly available for a subscription fee. Additionally, enacted laws are published free of cost on the website of the National Assembly or Parliament, but there is a delay in updating the website.
Regulations and enforcement actions are appealable with regulatory decisions subject to judicial review. The Office of the Ombudsman also may investigate allegations of official wrongdoing but has no legal authority to bring judicial charges. Reports of wrongdoing are submitted to the affected ministry. Additionally, the Annual Report of the Ombudsman is presented to the National Assembly and is a publicly available document.
The offices for business and personal income tax amalgamated into the Belize Tax Service, which launched an online tax payment system in August 2021. The Companies Registries, along with the court system, are being digitized to facilitate e-filing of documents and online payment of fees. In March 2022, the government lowered business tax on the net interest income charged to banks and financial institutions with a view to incentivizing lending in strategic foreign exchange earning sectors and at the same time increased the tax on specific sectors to disincentivize personal and distribution loans. The amendments to the tax system will improve tax collection and a stem leakage. Other anticipated reforms are expected to improve the ease of doing business, provide greater transparency and stimulate economic growth with lending to foreign exchange earning sectors.
Information on public finance, both the government’s budget and its debt obligations (including explicit and contingent liabilities) are widely accessible to the public, with most documents available online. The budget documents do not include information on contingent or state-owned enterprise (SOE) debt unless the GoB guarantees or is paying these debts. Nonetheless, the audited annual reports of all major SOEs were publicly available on their websites. The Auditor General’s report on government spending, however, is often significantly delayed.
As a full member of the Caribbean Community (CARICOM), Belize’s foreign, economic and trade policies vis-a-vis non-member states are coordinated regionally. The country’s import tariffs are largely defined by CARICOM’s Common External Tariff.
Besides CARICOM, Belize is a member of the Central American Integration System (SICA) at a political level, but is not a part of the Secretariat of Central American Economic Integration (SIECA) that supports economic integration with Central America. Belize is also a member of the WTO and adheres to the Organization’s agreements and reporting system.
The Belize Bureau of Standards (BBS) is the national standards body responsible for preparing, promoting, and implementing standards for goods, services, and processes. The BBS operates in accordance with the WTO Agreement on Technical Barriers to Trade and the CARICOM Regional Organization for Standards and Quality. The BBS is also a member of the International Electrotechnical Commission (IEC), the International Organization for Standardization (ISO), and Codex Alimentarius.
As a former British colony, Belize follows the English Common Law legal system. The Belize Constitution is the supreme law and founded on the principle of a separation of powers with independence of the judiciary from the executive and legislative branches of government. Belize has a written Contract Act, but no specialized courts to deal with commercial disputes or cases.
The judicial system remains generally independent of the executive branch. Case law exists where the judiciary has ruled against the government, and its judgements are respected and authoritative. The highest appellate court exists outside of Belize at the Caribbean Court of Justice, providing a level of independence for the judiciary. The judiciary remains underfunded and understaffed resulting in frequent adjournments, delays, poor case-flow management and a backlog of cases. General information relating to Belize’s judicial and legal system, including links to Belize’s Constitution, Laws and judicial decisions are available at the Judiciary of Belize website .
Businesses and citizens may appeal regulations and enforcement actions. Regulatory decisions are also subject to judicial review. Judgments by the Belize Supreme Court and the Court of Appeal are available at .
The Caribbean Court of Justice has two jurisdictions, appellate and original, in relation to CARICOM Members States. In its appellate jurisdiction, the CCJ is the final court of appeal for both civil and criminal matters emanating from CARICOM Member States. In its original jurisdiction, this Court is responsible for interpreting and applying the Revised Treaty of Chaguaramas, the treaty establishing the Caribbean Community and CARICOM Single Market and Economy.
The country has an English Common Law legal system supplemented by local legislation and regulations. The legal system does not generally discriminate against foreign investment and there are no restrictions to foreign ownership. The Exchange Control Act and its subsidiary laws and regulations, however, provide the legal framework that applies to foreign ownership and control. Other laws stipulate that foreign investment can qualify for incentives; citizens have the right to private property; contracts are legally binding and enforceable, and regulations are subject to judicial review among other provisions favorable to foreign investment.
Major laws enacted or amended are generally available in the National Assembly’s website at . For the previous year, these include the Blue Bond Loan Act, 2021; Companies (Amendment) Act, 2021; Data Protection Act, 2021; Electronic Evidence Bill, 2021; Electronic Transactions Act, 2021; Electronic Transfer of Funds Crime Act, 2021; Immigration (Amendment) Act,, 2021; Patents (Amendment) Act, 2021; Public Sector Data Sharing Act, 2021; Securities Industry Act, 2021; Stamp Duties (Amendment) Act, 2021; Sugar Industry (Amendment) Act, 2021; Trademarks (Amendment) Act, 2021; Tax Administration and Procedures (Amendment) Act, 2021; Central Bank of Belize (Amendment) Act, 2022; and Income and Business Tax (Amendment) Act, 2022.
There is no “one-stop-shop” website for investment, and the laws, rules, procedures, and reporting requirements related to investors differ depending on the nature of the investment. BELTRAIDE provides advisory services for foreign investors relating to procedures for doing business in Belize and what incentives might be available to qualifying investors. Further information is available at the BELTRAIDE website:
Belize does not have any laws governing competition, but there are attempts to limit outside competition in certain industries (such as food and agriculture) by levying high import duties and import licensing requirements.
The government used the right of eminent domain in several cases to expropriate private property, including land belonging to foreign investors. There were no new expropriation cases in 2021. However, claimants in previous cases of expropriation assert the GoB failed to honor agreements entered into by a previous administration. Belizean law requires that the government assess and compensate according to fair market value. Expropriation cases can take several years to settle and there are a few cases where compensation is still pending. Belize nationalized two companies in public-private partnership: Belize Electricity Limited and Belize Telemedia Limited. These actions were challenged in the courts and resolved in 2015 and 2017, respectively.
The Caribbean Court of Justice delivered a judgment relating to the Belmopan Land Development Corporation Limited (BLDCL) in January 2022, wherein it upheld the decision of the trial judge in favor of BLDCL. The case pertained to compensation owed by the government for 1,394 acres of land expropriated in 2013. After negotiations for market value failed, the matter was taken before local courts. The CCJ upheld the trial judge’s quantum of damages to BLDCL for just over US $8 million.
The Bankruptcy Act of Belize provides for bankruptcy filings. The Act provides for the establishment of receivership, trustees, adjudication, and seizures of the property of the bankrupt. The court may order the arrest of the debtor as well as the seizure of assets and documents in the event the debtor may flee or avoid payment to creditors. The Director of Public Prosecutions may institute proceedings for offenses related to the bankruptcy proceedings. The bankruptcy law generally outlines actions a creditor may take to recoup losses. Bankruptcy protections are not as comprehensive as U.S. bankruptcy law.
4. Industrial Policies
The legal framework authorizing and providing for investment incentives include the Fiscal Incentives Act, the Designated Processing Areas Act, the Free Zones Act, the International Business Companies Act, the Retired Persons Incentives Act, the Diaspora Retiree Incentive Program, the Trusts Act, the Offshore Banking Act, and the Gaming Control Act. These acts offer a range of incentives including tax deferments, tax reductions, access to land and capital, and preferential access to some government concessions.
While government policies support public private partnerships, they do not generally issue guarantees or joint financing of foreign direct investment projects. In exceptional circumstances, guarantees have been issued for SOE investments to purse funding from development institutions. In October 2021, the GoB approved a draft public private partnership policy (PPP) and the creation of the PPP unit to mobilize private sector capital to support large-scale investments in infrastructure and other development projects.
In March 2022, the government amended the Income and Business Tax Act to decrease the incentive lending rate from 15 percent to 12 percent in strategic foreign exchange earning sectors including tourism, agriculture, and business processing outsourcing. The Central Bank of Belize and the Government of Belize also established the Emergency Business Support Program (EBSP) in the last year to provide financing through domestic banks and the Development Finance Corporation to businesses affected by the COVID –19 pandemic.
The Designated Processing Areas Act (DPA) was passed in 2018 to replace the former Export Processing Zone Act. The DPA remains a tool to attract local and foreign investments that follow value-added business models to boost production for export markets. Approved companies under this program receive a DPA status for a period of up to ten years and may qualify for various tax exemptions. Approved companies are given certain exemptions, including from the Trade Licensing Act requirements for operating in a municipality and the Supplies Control Act, in relation to the importation of raw materials for production that are not available in Belize. Companies may maintain a foreign currency account in a domestic or international bank located in Belize as well as sell, lease, or transfer goods and services between DPA companies. While subject to the Income and Business Tax, businesses may qualify for a preferential tax rate on chargeable income. They may also be eligible for an annual quota for fuel solely for specified uses.
A Free Zone Act passed in 2019 amended the Commercial Free Zone (CFZ) Act. Belize currently has two CFZs, one on the northern border with Mexico and a small zone on the western border with Guatemala. The legislation limited the activities allowed in CFZ to specific sectors. Banks and financial institutions licensed under the laws of Belize are allowed to operate within a CFZ, but their transactions are limited to only CFZ-centered business.
Companies may operate both in the national customs territory and in the Free Zone, but must maintain separate accounts in respect of business activities. Additionally, goods entering the customs territory are subject to customs duties. The Commercial Free Zone Management Agency (CFZMA) monitors and administers the free zones. Incentives include exemptions from import duties, income tax, taxes on dividends, capital gains tax, or any new corporate tax levied by the government during the first ten years of operation. In addition, imports and exports of a CFZ are exempt from customs duties, consumption taxes, excise taxes, or in-transit taxes, except those destined for or directly entering areas subject to the national customs territory.
Domestic and foreign investors seeking to access incentives offered under the various incentive programs must comply with the program conditions including performance requirements. Investments that have been approved for incentives generally report to the authorizing agency, namely BELTRAIDE or the Ministry of Finance, Economic Development and Investment, to ensure they meet stipulations on the concession.
The Fiscal Incentives Act awards a qualified entity a development concession during the start-up or expansion stages to foster growth by offsetting custom duties. According to BELTRAIDE (www.belizeinvest.org.bz), two programs are offered under this Act: the Regular Program for investments exceeding US $150,000 and the Small and Medium Enterprise (SME) program for investments of less than US $150,000.
In general, investment incentives are applicable to both domestic and foreign investors. The Fiscal Incentives SME Program, however, is aimed at smaller enterprises with a minimum of 51 percent Belizean ownership. The SME Program offers the same benefits of the Regular Program, except for the allowable timeframe for duty exemptions. Under this program, companies are allowed a maximum of five years of development concessions, with the expectation that after this period, companies can mature into the Regular Program.
The Qualified Retirement Program (QRP) was created to facilitate eligible persons who have met the income requirements to permanently live and retire in Belize. The Belize Tourism Board oversees this program designed to benefit retired persons over 45 years of age. To qualify, applicants need proof of income not less than US $2,000 per month through a pension or annuity generated outside of Belize. An approved QRP is allowed to import personal effects as well as approved means of transportation, free of customs duties and taxes. Under the program, beneficiaries cannot engage in employment, own a business or invest in Belize.
In November 2021, Belize passed the Data Protection Act, which is partially aligned with Europe’s General Data Protection Regulation (GDPR). The Act mandates the sharing of data between governmental agencies and categorizes financial records as sensitive personal data. It also lays out fines are as high as US $250,000. The Act creates a carve-out for international transfers of data to cloud storage outside Belize whereby no consent is required from data subjects. Additionally, the Act gives a three-day window as the default for notifying the Commissioner and data subjects of breaches.
5. Protection of Property Rights
The preamble of the Belize Constitution preserves the right of the individual to own private property to operate private businesses. Common law, Belize legislation, and case law all reinforce property rights and interests. Private entities, whether foreign or local, have the right to freely establish, acquire, and dispose of interests in property and business enterprises. Generally, the country has no restrictions on foreign ownership and control; however, foreign investments in Belize must be registered at the Central Bank of Belize and adhere to the Exchange Control Act and related regulations.
Mortgages and liens exist, and related real estate is recorded with the registry of the Lands and Survey Department. The Lands and Survey Department has a history of corruption, and there have been charges of land fraud, abuses, and cronyism leveled against the Department during each administration. As part of its land reform policy, the Lands Department continues to engage with the public through mobile clinics, where Lands Department personnel visit communities across to country to address land concerns, including issuing freehold titles. Investors are nonetheless advised to perform due diligence prior to purchasing property.
Foreign and/or non-resident investors are not allowed to acquire national lease property but may acquire titled privately owned property. The Central Bank regulates real estate transactions involving non-residents for exchange control purposes. Additionally, the rate of stamp duty chargeable on land transfers involving foreign persons or a foreign controlled company is 8 percent for land transfers valued in excess of US $10,000, as opposed to 5 percent on transfers involving Belizeans and CARICOM nationals.
There are three different types of titles to freehold property in Belize: Deed of Conveyance, Transfer of Certificate of Title, and Land Certificate. Leasehold property from the government is available to Belizeans who can then apply for conversion to a fee simple title. Squatters’ rights exist but are only enforceable by order of the Supreme Court after the resident has proven uninterrupted possession for at least 30 years on national lands or at least 12 years on registered lands.
Belize is a member of the WTO and has implemented the Agreement on Trade-Related Aspects of Intellectual Property (TRIPS). Generally, Intellectual Property (IP) rights must be registered and enforced in Belize. IP protections are enforceable through civil proceedings initiated by the IP holder. The Belize Intellectual Property Office (BELIPO) (http://belipo.bz) was established to administer IP laws and functions as the country’s national intellectual property registry. Its mandate covers the protection of copyrights, industrial designs, patents, trademarks, new plant varieties, and topographies of integrated circuits.
In practice, however, there is no active enforcement of IP protections, though there is active pursuit and prosecution of contraband. Bootleg CDs and DVDs are widespread and are marketed throughout the country and are especially prevalent in the Free Zones. During the past year, Belize enacted the Patents (Amendment) Act, 2021 and the Trademarks (Amendment) Act, 2021. Both amendments allow the Registrar of Intellectual Property to delegate certain function to the Deputy Registrar. There has been no report on seizures of counterfeit goods and no prosecution of IPR violations in the last year. Belize is not listed in the 2021 USTR’s Special 301 report nor the 2021 notorious market report.
6. Financial Sector
Belize’s financial system is small with little to no foreign portfolio investment transactions. It does not have a stock exchange and capital market operations are rudimentary. In 2021, Belize passed the Securities Industry Act for the modernization of the laws on securities and capital markets. The Central Bank of Belize must approve capital transactions, such as the purchase and sale of land, company shares, financial assets, and other investments that the transfer of assets between foreign and local entities. The Central Bank advised that, effective April 2022, it would only accept electronic applications for the approval of portfolio and capital investments and land transfers.
Belize accepted the obligations of Article VIII, and the exchange regime is free of restrictions or multiple currency practices.
Credit is made available on market terms with interest rates largely set by prevailing local market conditions within the commercial banks. The credit instruments accessible to the private sector include loans, overdrafts, lines of credit, credit cards, and bank guarantees. Foreign investors can access credit on the local market. Under the International Banking Act, foreign investors/nonresidents may access credit from international banks registered and licensed in Belize. However, permission to access credit from the domestic banks requires Central Bank approval. The Belize Development Finance Corporation (DFC), a state-owned development bank, offers loan financing services in various sectors. To qualify for a loan from DFC, an individual must be a Belizean resident or citizen, while a company must be majority 51 percent Belizean owned. The National Bank of Belize is a state-owned bank that provides concessionary credit primarily to public officers, teachers, and low-income Belizeans.
A financial inclusion survey undertaken by the Central Bank of Belize in 2019 showed that approximately 65.5 percent of adult Belizeans had access to a financial account. In response, the banking sector has begun introducing digital wallet solutions to reach “unbanked” segments of the population.
Belize’s financial system remains underdeveloped with a banking sector that may be characterized as stable but fragile. International reserves increased from US $348 million (3.8 months of imports) in 2020 to US $420 million (3.9 months of imports) in 2021, partly due to the IMF’s Special Drawing Rights (SDR) 25.6 million allocation, which Belizean authorities are keeping as reserve.
Regulatory capital is still well above minimum requirements, while the gross non-performing loan (NPL) ratio at the end of February 2022 stood at 5.58 percent of loans. However, the Central Bank is reviewing domestic banks and credit unions self-assessments as the expired forbearance measures from 2020 could represent a risk as a fraction of their loan portfolio could turn into NPLs.
Generally, there are no restrictions on foreigners opening bank accounts in Belize. Regulations differ based on residency status and whether the individual is seeking to establish a local bank account or a foreign currency account. Foreign banks and branches are allowed to operate in the country with all banks subject to Central Bank measures and regulations.
Since January 2020 to present, a domestic bank and an international bank each lost a correspondent bank. Belize’s financial system comprises five domestic banks, three international banks, and ten credit unions. Correspondent banks discontinued offered correspondent banking relationships (CBR) to Scotiabank (Belize) Limited following the acquisition of the Scotiabank (Belize) Limited by the Caribbean International Holdings Limited. As of February 2022, the estimated total assets of the country’s largest bank were US $1.09 billion.
In the last few years, Belize continues reforms to strengthen the anti-money laundering and counterterrorism-financing regime, including conducting an interagency national money laundering and terrorist financing (ML/TF) risk assessment.
Belize does not have a sovereign wealth fund.
7. State-Owned Enterprises
State Owned Enterprises (SOEs) exist largely in the utilities sectors, generally as a result of nationalization. The government is the majority shareholder in the Belize Water Services Limited, the country’s sole provider of water services, the Belize Electricity Limited, the sole distributor of electricity, and the Belize Telemedia Limited, the largest telecommunications provider in the country. The Public Utilities Commission regulates all utilities.
SOEs usually select senior government officials, members of local business bureaus and chambers of commerce, labor organizations, and quasi-governmental agencies to staff these companies’ boards of directors. The board serves to direct policy and shape business decisions of the ostensibly independent SOE. Current and previous administrations have been accused of nepotism and cronyism and criticized for having conflicts of interest when board members or directors are also represented in organizations that do business with the SOEs.
There is no published list of SOEs. The following are the major SOEs operating in the country. Information relating to their operations is available on their websites: Belize Electricity Limited ; Belize Telemedia Limited at ; Belize Water Services Limited
There is no public third-party market analysis that evaluate whether SOEs receive non-market advantages by the government. The Belize Electricity Limited and the Belize Water Services Limited are the only service providers in their respective sectors. The Belize Telemedia Limited, on the other hand, competes with one other provider for mobile connectivity and there are multiple players that provide internet and data services. U.S. firms have identified challenges in participating and competing in areas related to the bidding, procurement and dispute settlement processes, particular to SOEs.
The Government of Belize does not currently have a privatization program.
8. Responsible Business Conduct
Belize generally lacks broad awareness of the expectations and standards for responsible business conduct (RBC). However, many foreign and local companies engage in responsible corporate behaviors and partner with NGOs or international organizations to reinvest in community development and charitable work. Companies sponsor educational scholarships, sports-related activities, community enhancement projects, and entrepreneurship activities, among other programs. There is a strong thread of environmental awareness that also impacts business decision-making. BELTRAIDE, in its official public outreach, promotes civic responsibility, especially in its outreach to entrepreneurs and aspiring businesspeople.
The Office of the Ombudsman is responsible for investigating complaints of official corruption and abuse of power. As required by law, the Ombudsman is active in filing annual reports to the National Assembly and investigating incidents of alleged misconduct, particularly of police abuses. This office continues to be constrained by the lack of enforcement powers, political pressure, and limited resources.
Belize has no recent cases of private-sector impact on human rights and no NGOs, investment funds, worker organizations/unions, or business associations specifically promote or monitor RBC.
Certain projects require the Department of the Environment’s approval for Environmental Impact Assessments or Environmental Compliance Plans. The Department of Environment website, , has more information on the Environmental Protection Act, various regulations, applications, and guidelines.
Belize has not adopted a particular accounting framework as its national standard. The International Financial Reporting Standards (IFRS) are required for domestic banks under the Domestic Bank and Financial Institutions Act (DBFIA) of Belize. Also, under the DBFIA, the Central Bank of Belize issues practice direction, directives, guidance, and advisories on corporate governance applicable to all banks and financial institutions operating and supervised by the Central Bank.
For other companies, Belize permits the use of IFRS Standards and the IFRS for SMEs as the standard financial reporting framework for preparing financial statements. The Institute of Chartered Accountants of Belize regards IFRS Standards as an allowed accounting framework under its professional standards. Alternatively, non-bank companies are permitted to use other internationally recognized standards. The U.S. Generally Accepted Accounting Principles (GAAP) and Canadian GAAP are often used. There are no government measures relating executive compensation standards and RBC policies are not factored into procurement decisions. Opposition party political pronouncements often target official malfeasance in procurement and cronyism in government contracts, but these concerns are historically muted once the opposition takes power.
There are similarly no alleged or reported human or labor rights concerns relating to RBC. In recent years, labor unions and business associations have become actively engaged in advocating for stronger measures against corruption.
Belize does not have a developed mineral sector and is not a conflict or high-risk country. As such, it does not adhere to the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Afflicted and High-Risk Areas. Belize’s extractive/mining industry is not developed, and it does not participate in the Extractive Industries Transparency Initiative (EITI) and/or the Voluntary Principles on Security and Human Rights.
The country is not a signatory of The Montreux Document on Private Military and Security Companies, nor is it a supporter of the International Code of Conduct or Private Security Service Providers and is not a participant in the International Code of Conduct for Private Security Service Providers’ Association.
Over the last decade, Belize has developed several important climate policy frameworks. These include the National Climate Resilience Investment Plan, Growth and Sustainable Development Strategy 2012 – 2017, and the National Climate Change Policy, Strategy and Action Plan (2015 – 2020. More recently in 2021, Belize submitted its updated National Determined Contributions (NDC), as well as its National Climate Finance Strategy, to reduce national greenhouse gas emissions as it responds to climate change.
Belize is categorized as a small island developing state (SIDS) that is highly vulnerable to the effects of climate changes and is a relatively minor contributor to global greenhouse gas emissions. Belize’s updated National Determined Contributions (NDC) is nonetheless committed to developing a long-term strategy aligned with achieving net zero global emissions by 2050. Government strategies do specify expectations on private sector contributions as well as support required to the private sector to achieve climate targets, particularly as they relate to the electricity, transportation, and waste management sectors.
Belize has a wide array of government policies that contribute to its climate and conservation agenda, including over one hundred terrestrial and marine protected areas through co-management arrangements between the government, non-government organizations, and community-based organizations. These are complemented by sustainable forest management, fisheries management, and other ecosystem management plans. Belize is hopeful for greater climate financing from multilateral institutions and creditors to implement climate change mitigation and adaptation policies. In January 2022, the government established the Climate Finance Unit (CFU) to maximize Belize’s access to climate finance to enhance resilience and sustainable development. Some procurement policies do include environment and green growth considerations, particularly if projects are funded by external donors.
Belize has anticorruption laws that are seldom enforced. Under the Prevention of Corruption in Public Life Act, public officials are required to make annual financial disclosures, but there is little adherence and poor enforcement. The Act criminalizes acts of corruption by public officials and includes measures on the use of office for private gain; code of conduct breaches; the misuse of public funds; and bribery. This Act also established an Integrity Commission mandated to monitor, prevent, and combat corruption by examining declarations of physical assets and financial positions filed by public officers. In practice, the office is understaffed and charges are almost never brought against officials. It is not uncommon for politicians disgraced in corruption scandals to return to government after a short period of time has elapsed. The Money Laundering and Terrorism (Prevention) Act identifies “politically exposed persons” to include family members or close associates of any politician.
The Ministry of Finance issues the Belize Stores Orders and Financial Orders – policies and procedures for government procurement. The Manual for the Control of Public Finances provides the framework for the registration and use of public funds to procure goods and services. Private companies are neither required to establish internal codes of conduct, ethics, or compliance programs, nor is it common to use them.
In June 2001, the Government of Belize signed the Organization of American States (OAS) Inter-American Convention on Corruption, which calls for periodic reviews. In December 2016, Belize acceded to the United Nations Convention Against Corruption (UNCAC) amid public pressure and demonstrations from the teachers’ unions. The Belizean government continues to be criticized for the lack of political will to fully implement UNCAC.
There are few non-governmental institutions that monitor government activities. The most active, the National Trade Union Congress of Belize (NTUCB), lobbies within narrow labor-related areas. Environmental NGOs and the Belize Chamber of Commerce and Industry (BCCI) often make statements regarding government policy as it affects their respective spheres of activity. The government does not provide protection to NGOs investigating corruption.
Despite these measures, many businesspeople complain that both major political parties practice bias that creates an unlevel playing field related to businesses seeking licenses, the importation of goods, winning government contracts for procurement of goods and services, and transfer of government land to private owners. Some middle-class citizens and business owners have complained of government officials, including police, soliciting bribes.
Contact at the government agency or agencies that are responsible for combating corruption:
Office of the Auditor General
Corner of Douglas Jones Street & New Road
Belize City, Belize
Mountain View Boulevard
Belmopan City, Belize
501-222-5181, 222-5086, 822-2850, 822-0208
Belize Integrity Commission
National Assembly Building, Independence Hill
For specific complaints within the police force:
Professional Standards Branch
1902 Constitutions Drive
T: +501-822-2218 or 822-2674
10. Political and Security Environment
Belize has traditionally enjoyed one of the most stable political environments in the region, having held peaceful and transparent democratic elections since gaining independence on September 21, 1981. In general elections, the two major political parties usually trade leadership. The current People’s United Party gained an overwhelming majority in the November 2020 General Elections, winning twenty-six of the thirty-one electoral divisions. The few times political candidates have questioned the result of elections, these have been settled by the court.
There were incidents of property destruction at two American companies involved in sugar cane industry in the last year. In December 2021, cane farmers from Belize’s largest cane farmers association blockaded the access road to a major American investment in Orange Walk for three days, preventing other farmers from delivering cane to the factory. An impasse between the cane farmer association and the sugar mill for a contract to deliver cane sparked the incident. The American investment subsequently initiated two legal suits against the cane farmer’s association for destruction to property and economic losses incurred. The second company located in the Cayo District, suffered arson in January 2022, presumably related to a conflict associated with land rights. Over 1,200 acres of sugar cane was lost in the fire, an estimated loss of US $1.15 million. In response, a prominent agro-productive organization wrote to the Government in January 2022 expressing concerns that the Belizean government’s failure to protect and support private sector investors in these instances led to damaging the investment climate and Belizean economy still further.
Neighboring Guatemala’s long-standing territorial claim on Belize has persisted for almost two centuries. The International Court of Justice (ICJ) is currently deliberating the territorial dispute. In December 2020, Guatemala filed its claim to Belize’s continental land, islands, and seas, and Belize will file its counter claim in June 2022. Despite legal efforts to resolve the claim, the Friends for Conservation and Development (FCD), a local Belizean NGO, continues to document illegal encroachments and settlements in and beyond the adjacency zone in Belize. In July 2021, FCD rangers accompanied by Belize Defence Force (BDF) members were fired upon by Guatemalan civilians as the former attempted to destroy illegal plantations in the Chiquibul forest reserve in Belize. The BDF retaliated, which in turn instigated the response of the Guatemalan Armed Forces (GAF). The incident did not escalate further and there were no casualties.
The second major security concern is the high level of crime countrywide. While Belize has a high murder rate per capita, it is primarily focused on the urban areas of Belize City. Corruption, human and drug trafficking, money laundering (institutional and trade-based), and local criminal gang activity remain significant problems exacerbated by the low conviction rate.
11. Labor Policies and Practices
According to the Statistical Institute of Belize (SIB), the population was estimated to be 432,516 as of September 2021. The labor force was 191,881 as of September 2021. Of this, the unemployed amounted to 17,644 persons for an unemployment rate of 9.2 percent, representing a 4.5 percent decrease from September 2020. The report noted that about 48 percent of working aged women participated in the labor force and 76.1 percent of men. The main reason women did not look for work was due to personal or family responsibilities, while men did not look for work mainly due to school or training.
In its Labor Force Survey of September 2021, the Statistical Institute of Belize estimated the number of persons in informal employment was 72,433 accounting for about 41.6 percent of all employed persons. Persons in informal employment earned about US $420 per month. A 2018/2019 Household Budget Survey assessed the country’s poverty level had increased from 41.3 percent in 2009 to 52 percent in 2012. The poverty line in 2018 was assessed at US $3,980 per annum or US $331.66 monthly. The Government of Belize asserts the COVID-19 pandemic raised the poverty rate, which hovers at almost 60 percent, and sparked significant growth of the informal sector. The agriculture sector has identified shortage of unskilled labor in the agriculture sector. The health sector faces a shortage of qualified nurses and high.
In general, there are no restrictions on employers adjusting their labor force in response to fluctuating market conditions. Employers are flexible in offering salary increases, which are normally justified based on cost of living and prevailing practice consideration. Severance payment is subject to local labor law, the Labour Act Chapter 297. This Act differentiates between layoffs (voluntary termination and redundancy) and firing (dismissal). In the cases of voluntary termination and redundancy, the law provides for an appropriate notice period, payment in lieu of notice, severance, etc. In the case of redundancy, the employer must notify, where applicable, the recognized trade union or workers’ representative as well as the Labour Commissioner.
In addition to the general Social Security system, the government maintains a National Health Insurance scheme in certain marginalized communities throughout the country. The government also provides some assistance to unemployed persons who represent marginalized sectors of the community, e.g., single women, single mothers, and young unemployed persons.
Foreign investors who have a development concession are permitted to bring in skilled personnel to complement their local labor force and, if appropriate, establish training programs for Belizean nationals. Labor laws are not generally waived to attract or retain investment.
Belize has eleven trade unions and an umbrella organization, the National Trade Union Congress of Belize (NTUCB). Belize has ratified 50 International Labor Organization (ILO) conventions, of which 45 are in force, including Convention 182 against the worst forms of child labor. Trade unions are independent of the government and employers both in practice and in law. The Department of Labour recognizes registered unions and employers’ associations. Trade union laws establish procedures for the registration and status of trade unions and employers’ organizations and for collective bargaining. Unions are common in the public sector (teachers, general public servants), the Social Security Board, the utility and agriculture sectors, and among port stevedores.
Where employees are unionized, employers must refer to the laws relating to the operation of unions as well as the terms of existing collective bargaining agreements between the employer and unions. Where disputes arise between an employer and employee in the private sector and where the employee is not represented by a union, both parties may approach the Labour Department to mediate discussions for an amicable solution. Failing a resolution, the matter is then first referred to the labor tribunal then to the court.
The national fire service, postal service, monetary and financial services, civil aviation and airport security services, and port authority pilots and security services are all deemed essential services. The law allows authorities to refer disputes involving employees who provide “essential services” to compulsory arbitration, prohibit strikes, and terminate actions. On January 21, 2022, stevedores at the port in Belize City undertook industrial action against the port. The Essential Services Arbitration Tribunal delivered a notice on January 27, 2022, mandating the port management confirm the selected stevedores as registered stevedores, pay contributions to retirement savings for stevedores, and commence negotiations for the payment of redundancy packages. Port management countered with a lawsuit that remains before the courts, claiming US $500,000 in damages and loss of business.
Belize does have laws and regulations relating to international labor standards. There is also a system in place for labor inspectors to advocate on labor-related concerns and complaints, as well as to visit and inspect business facilities to ensure adherence to local labor laws. Belize’s legislation does not address a situation in which child labor is contracted between a parent and the employer. The penalty for employing a child below minimum age is a fine not exceeding US $10 or imprisonment not exceeding two months.
Additionally, while there are laws that prohibit a wide range of discrimination in the workplace, they are not effectively enforced and do not explicitly provide protections for persons with disabilities or against discrimination related to sexual orientation and/or gender identity. There is anecdotal evidence that certain vulnerable sectors, particularly migrant workers, undocumented persons, young service workers, and agricultural laborers, were regularly paid below the minimum wage and classified as contract and nonpermanent employees to avoid providing certain benefits.
The GoB established a minimum wage task force to oversee the implementation of the five-dollar minimum wage in a phased approach, which is expected to commence by July 1, 2022.