By Richard Harrison: Belize has increased its external debt from around BZ$2.3 billion in 2008 to around BZ$3.2 billion currently.
Last week, the country missed a payment due on the SuperBond, and has a 30 day grace period in which it can pay up to remain current….and a 90-day period to avoid a sovereign default
While there are no official estimates of Belizeans living abroad, it has been suggested that the number is anywhere between 125,000 and 300,000 living in the USA alone.
Belizeans and their offsprings in the diaspora maintain close ties with their family and friends in Belize, and recent estimate of remittances from the USA to Belize amount to around BZ$170 million annually….or around 5% of GDP.
Many in the diaspora remain interested in Belize’s development and would like more and deeper participation…..Belize needs help to address its acute debt crisis…..and common ground must be sought and found.
Belize should offer Belizean diaspora instruments through which they can increase and deepen their participation…..such as a BELIZE DEVELOPMENT TRUST, where Belizeans living abroad can contribute a nominal BZ$2,500 annually. If 25,000 such Belizeans can be convinced to invest in it, this instrument will raise around BZ$62.5 million annually.
This $62.5 million can be used in the following way:
1. 50%, or BZ$31.25 million, earmarked for payment towards national debt
2. 20%, or BZ$12.5 million, earmarked for providing legal counsel to Belizean diaspora to legalize their status
3. 30%, or BZ$18.75 million, pooled into a financial institution such as a savings and loans institution which can serve the needs of the diaspora in savings and loans
The Government of Belize should consider taking certain action to boost the confidence of the diaspora for making this kind of investment, perhaps:
1. Making provisions for eligible contributors to vote by proxy in municipal and national elections in Belize
2. Making provisions for born Belizeans living abroad to run for public office in Belize, after having returned to live in the country for a nominal period
3. Placing a moratorium on foreign borrowing for a period of 5 years or until debt-to-GDP ratio is below 70%
4. Placing limits on growth of government spending so that it be no more than 50% of the previous years’ GDP growth rate
5. Preparing credible short, medium and long term plans to grow the Belize non-oil economy at a rate above 3% annually, through implementing policies that improve the competitiveness and productivity of the economy
The Belize foreign ministry in the USA needs significant upgrade to provide more and better services to the diaspora. Principal among these responsibilities should include organizing the pooling of financial resources through a savings and loans institution in the USA.
Belizeans in the USA can and should make investments in businesses for which the diaspora can be competitive:
1. Lawn and garden maintenance
2. Construction and allied services, plumbing, electrical, etc.
3. Beauty Salons
4. Caribbean tastes restaurants and other entertainment
5. Child care and nursing home services
6. Auto repair and maintenance services
7. Private educational tutoring services
8. Private accounting and book keeping services
9. Small IT services
10. Real estate and property management services
This kind of out-of-the-box thinking and actions can and should integrate Belizean diaspora with the development of Belize and themselves in a deeper and broader way…..everybody wins!
The views expressed in this article are those of the writer and not necessarily those of Breaking Belize News.
This article was written by Richard Harrison, Belizean investor in production and services businesses in Belize. He holds a Master’s in Business Administration degree from Lancaster University.
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