Email

Print

And one part of the increased revenue from exports is an increase in sales of crude oil from $4.8 million to $7.8 million.  That’s a sharp increase, but it’s because of world prices which are going up - it doesn't mean more oil is coming out of the ground.  The SIB notes that the export volumes in January 2017 remained virtually unchanged from January 2016. 

So while there is an increase in revenue, the oil resource continues to diminish as the Mike Usher oil wells in Spanish Lookout are drying out.  According to Dr. Justin Ram of the CDB, that is a big part of Belize’s economic downturn, and the cocktail of crippling debt with revenue downturns:

Dr. Justin Ram - Director of Economics, CDB
"We know that the government now is experiencing fiscal difficulties and a big part of that as they have rightly seen, is that their debt burden, about 34% of their debt burden is related to the super bond, and, of course, there is some requirement to look at how you’re going to repay that."

I think that it is important for Belize's to understand that, the oil, the oil sector has now almost ground to a complete halt, it’s too expensive to get whatever oil is remaining in the ground out and because international prices are so low, it's just not profitable. So the government will have also received significant revenues form that particular sector and those revenues are no longer coming in. Because we have seen the decline in the oil sector which was very important for Belize, it means that the government now has to consider alternative sources of revenue, so the economy need to diversify, so as we have been saying here this morning, that means that the doing business environment needs to be improved."

If the private sector can't see how they can make a profit in a particular country, they certainly will not want to invest and so the government needs to provide that enabling environment."