The IMF finished its Article IV Consultation in Belize yesterday and issued its concluding statement this morning. While not exactly upbeat, the report does note with encouragement that "the economy is expected to return to positive growth in 2017", but laments that "the medium term outlook remains weak." They project 2½ percent growth in 2017, and an average of just under 2 percent in the medium-term. The report also concludes that international reserves are projected to decline to two and a half months of imports over the medium term, and, quote, "any negative shocks could push them below that level."
Notably, the IMF estimates the overall level of public debt at about 100 percent of GDP - which is very high.
And, once again, the IMF is urging the government to increase the percentage rate on GST and reduce zero rated items. The report states, quote, "reform options include broadening the base of the General Sales Tax (by removing zero-rated items and streamlining exemptions), and/or increasing the GST rate from 12.5 percent to the regional average of 15 percent."
And, again, the IMF wants government to cut jobs in the public sector, saying, "a civil service reform could help stabilize the number of public employees and contain the wage bill. Moreover, the public sector pension plan could become contributory and pensions adjusted to be in line with inflation."
These are almost like a chorus now for the IMF, which the Barrow Administration has consistently rejected.
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