Belize’s economy projected to contract nearly 14 percent as World Bank confirms COVID-19 economic recession

By Aaron Humes: Evidence of a bumpy economic ride is piling up for Belize, with the World Bank the latest to confirm that things are not looking to be good anytime soon. But then again, everyone is feeling the pinch.

The World Bank, in its June 2020 Global Economic Prospects report released Monday, said the Caribbean is projected to experience a 3.1 percent contraction this year, excluding Guyana, and a 1.8 percent contraction if Guyana is included. The Bank said COVID-19 is set to plunge the global economy into the worst recession since World War II, and the Caribbean will not be exempt, with only one regional nation forecast to grow economically this year.

For Belize, the World Bank forecasts a 13.5 economic decline this year. But the good news is that the economy is projected to rebound to 6.7 percent growth next year.

Tourism, as we have reported, is at a near standstill, with operators practically begging Government to reopen to cruise ships and airport flights. Agriculture continues to struggle as does manufacturing and the only sector to see growth in the last term was Government services, according to the Statistical Institute of Belize (SIB).

Prime Minister Dean Barrow, set to retire at the end of the current term, has held fast to his program of infrastructure building and pledged to keep public officers and teachers on the payroll despite the heavy burden on the budget. He has also not ruled out defaulting on Superbond payments, though insisting he would have to talk to bondholders by the time the next payment is due in August. The projected deficit is currently estimated at $373 million.

As for Guyana, the South American CARICOM nation, despite its election brouhaha and drop in oil prices globally is the only regional country forecast to grow this year, with the World Bank report putting growth at 51.1 percent this year, though down to a more reasonable 8 percent next year.

Other countries will contract between 9.6 percent (Grenada) and 0.8 percent (Dominican Republic) this year, with rebounds of between 1 percent (Haiti) and 8.3 percent (St. Lucia) next year. The Dominican Republic has the highest number of COVID-19 cases and deaths in the region.

Giving a wider forecast for both Latin America and the Caribbean, World Bank analysts said the regions are projected to suffer not only the largest growth decline of the six regions of the world, but also its deepest recession of the past sixty years.

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