Belize is a politically and economically stable country. From the early days of Mayan civilization and the logging of 1600s to the recent explosion of offshore banking and tourism, the economy of the country has undergone a number of changes over the years. Although the global financial downturn of 2009 had an adverse impact on the economy of Belize, modest recovery was recorded in 2010. With its abundant natural riches and political stability, the outlook for business and economy in Belize is bright.
Logwood has played a major role in the economy of Belize. The industry attracted many Caribbean buccaneers during the mid 17th century. Initially the logwood was mainly used to prepare indigo dye, which was in high demand in the British textile industry. Soon the attention shifted to mahogany, which was available abundantly on these islands.
Logging was a volatile business with many ups and downs in prices as well as demand, for instance, mahogany prices dropped by almost 50% in 1835-41. With no efforts being made to replace the tress being cut, the mahogany supply soon started dwindling driving up the prices. Forestry continued to be a major source of income for the country well into the 1900s.
With the decline of forestry, agriculture, particularly sugar, took its place. Agriculture accounts for 71% of Belize’s overall foreign exchange income and provides employment to 29% of the labor force. Apart from cane sugar, the exports also include banana, seafood and citrus fruits. The agro sector was severely affected by heavy flooding and hurricanes in year 2007, 2008 and 2010.
Although about 38% of the total land area (1,998,230 acres) is suitable for agricultural use, only 10-15 percent is used annually. It is almost equally divided between permanent and annual crops, and pasture land. To overcome the susceptibility to external market changes because of the heavy dependence on traditional exports, efforts are being made to diversify agriculture.
Tourism is a key component of business and economy in Belize . It accounts for a major share of the country’s foreign exchange income. Abundance of natural treasures like the second longest barrier reef on the planet, warm tropical climate, ancient ruins, jungle wildlife, several islands and safe waters for boating, fishing, kayaking and such other activities support the flourishing tourism industry. The industry is considered one of the key development priorities by the government.
Although tourism is a major income earner for the country, it is also the biggest threat for its natural treasures. But most Belizeans are proud of their cultural heritage and the collaborative efforts of the locals and the government have formed a strong foundation for the development of eco-tourism industry.
Financial asset protection and offshore banking sector of Belizean economy is expanding rapidly. In the past few years a surge has been witnessed in the NPLs (non performing loans). The privacy offered by the government makes Belize an attractive jurisdiction for setting up bank accounts and trusts.
Lack of required infrastructure has been a major constraint for the development of business and economy in Belize. With dedicated efforts on part of the government, the country is slowly but steadily overcoming this roadblock.