Belize’s debt-to-GDP ratio down 45%

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by Khaila Gentle

BELMOPAN, Mon July 18, 2022
Belize’s debt-to-GDP ratio, which stood at 133% in 2020, is now at 88%, according to the Statistical Institute of Belize (SIB). A recent report released by the SIB in June revealed that the country’s economic output at the end of 2021 had surpassed that before the 2019 pandemic. This was largely driven by growth in manufacturing, construction , electricity, water, hotels and restaurants, wholesale trade. and retail trade and transport as well as a newly adopted methodology for calculating GDP.

As explained in an AMANDALA article dated Thursday, June 30, 2022, much of the significant increase in the country’s GDP can be attributed to an update by the Belize Institute of Statistics to the System of National Accounts methodology. (SCN) which is used for the calculation of GDP.

As part of its modernization initiative, the SIB moved from the now obsolete 1993 SNA to the 2008 SNA after finding that the previous method significantly underestimated the output of several industries and completely omitted new industries. With the new SNA, it was found that the country’s GDP over the years had been underestimated by about 27.6%.

In an interview with KREM News last month, the Minister of State at the Ministry of Finance, the Hon. Christopher Coye, explained that the significant increase in GDP following the SIB adjustments also changes the country’s debt-to-GDP ratio from below 100% to somewhere in the 80% range. With Monday’s press release, the government confirmed that the figure stands at 88%.

Belize’s government issued a press release on Monday, celebrating the 45% decrease and attributing a significant portion of the decrease to the replacement of the country’s $553 million Superbond with The Nature Conservancy’s blue bond, which reduced debt by about 12% of GDP.

Earlier this year, the International Monetary Fund recommended the government reduce the debt-to-GDP ratio to 80% by 2025.

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