The executive board of the International Monetary Fund (IMF) has concluded the Article IV Consultation with Belize.
Executive directors of the IMF noted the slight improvement in economic activity as of 2015 attributed to a rebound in agriculture, a strong performance in tourism, electricity, construction, services and the relatively strong widening of imports which offset the significant decline in oil-related activities which saw the fall in international oil and food prices in December of 2014.
The report continued by stating that the fiscal stance deteriorated significantly in the Fiscal year 2014/2015 where the primary fiscal balance recorded a deficit well above budget target, describing it as "a significant deterioration in the fiscal stance and the widening external current account deficit."
As it relates to the banking system the report concluded that the termination of major correspondent banking relationships with Belizean banks has so far had a limited impact on the financial system and economic activity.
However directors noted that the deficiencies identified by the Caribbean Financial Action Task Force (CFATF) have been mostly addressed, allowing Belize to recently exit the CFATF follow-up and monitoring process. Important reforms are still needed to ensure effective implementation of Belize’s Anti Money Laundering and combating the financing of terrorism regime in line with recent Financial Action Task Force standards.
The IMF goes on to describe Belize’s economic stance as "characterized by sluggish growth, weak fiscal stance, and external and financial sector vulnerabilities."
IMF directors called for a concerted effort to reduce vulnerabilities, rebuild policy buffers, and accelerate medium-to-long term growth in Belize. They also underscored the importance of boosting investor confidence and encourage private investment.
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