Friday, July 12, 2024

Prime Minister Dean Barrow presents 1.2 Billion Budget for 2019-2020


On March, Friday 15th Minister of Finance and Prime Minister of Belize, the Right Honorable Dean Barrow presented the official budget for the 2019-2020 fiscal year, under the theme: “Moving Ahead With Strong and Steady Economic Growth; Expansion of Opportunities for Business and Personal Advance; And Rededication to Basic Social Protection.” The $1.256 billion proposed budget highlights the country’s external deficit, debts, and optimism in the growth of the economy. No new taxes were introduced. However, there were adjustments to balance expenditures and revenues. As for possibilities of any projects to benefit Ambergris Caye, the budget presentation did not include any concrete plans.
A large amount of the $1.2 billion dollars allocated for the fiscal year 2019 to 2020, which begins on April first, will be spent on the government’s continued infrastructural improvement programs for the construction of new bridges and roads around the country. “How Government spends monies and allocates resources in these upcoming 12 months of the new financial year is driven by one central preoccupation, one sacred mission: to benefit the citizens of our nation, those that inhabit, make their way and organize their lives in our villages and towns and cities and open countryside,” said Barrow. “This means there will be a shortfall of $29.4 million (0.7% of the Gross Domestic Product – GDP) between revenue collections and spending. Another $103.0 million in loan amortizations will bring the total deficit to $132.5 million. Barrow said this difference would be made up through $76 million in loans from international development partners to finance the Government of Belize’s (GOB) Capital III Expenditure Program. The Republic of China on Taiwan will be contributing another $20 million in budget support financing, through the bilateral economic cooperation program between both nations. The remaining $36.5 million will be financed from domestic sources.”
Prime Minister Barrow noted that there had been a slight increase in the unemployment rate. He also said that liquidity conditions had tightened, but had remained well above statutory requirements. According to him, Belize’s financial sector is in good health, and there has been an increase in borrowing from the commercial banks. Belize has an outstanding external debt of 2.556 billion or 66.4% of GDP; Barrow stated that his priorities for 2019-2020 are to continue to provide resources for investment in roads and bridges, for education and health, and the provision of better services to a growing population. He added that the UDP’s pro-poor program is non-negotiable, listing food pantries, subsidies for high school, and the apprentice program, among others, that will continue under his leadership.
$179.2 million is being allocated for the government’s capital projects, which include the construction of roads and bridges. That allocation represents a slight increase over what was previously spent, said Barrow. The Prime Minister said that the government will not be borrowing any money for funding their capital projects, but will rely on the existing multilateral agencies. “Madam Speaker, it gives me particular pleasure to announce that we have received a commitment from the Government of Taiwan for funding the upgrading of the Corozal Town to Sarteneja Road to paved standards. The funding also includes the construction of two new bridges to replace two existing ferries along what we should now call this highway. The funding is for a total of US$50 million dollars,” said Barrow. He further announced, “Also, Madam Speaker, I also announce that our friends from the Kuwait Fund have preliminarily agreed to the financing of the Orange Walk Town to Progresso Road upgrade.”
“Apart from Corozal Town to Sarteneja and Orange Walk Town to Progreso, there is the Airport Link Road, the Coastal Highway and the Caracol Road. And before the end of this term, we will have replaced the country’s three most crucial bridges: the Hawkesworth, the Haulover, and the Kendall,” he said. “In this same vein, we are also replacing what has been necessary, for so long, all the narrow bridges along the Hummingbird. And all this is in addition to rebuilding the two most trafficked stretches of the George Price Highway and the Philip Goldson Highway: those between Ladyville and Belize City and between Belmopan and Santa Elena.”
Notwithstanding its social and capital spending, the government is still expecting a slowdown in the economy next year. “Going forward, the Central Bank projects that the pace of Belize’s economic growth will decelerate slightly to 2.8% in 2019,” Barrow said. “In commending this Budget for consideration and passage to the House, it is impossible for me not to feel pride at the spectacular prolongation of UDP fiscal and economic probity,” Barrow declared. “Once again, this administration configures a budget for the new fiscal year that ticks all the right boxes: the attainment of another impressive primary surplus; the augmentation of the services and salaries of the public sector; the funding of an ever-expanding envelope of strategic capital investments; the rightsizing of the debt obligations placed upon this and future generations; and above all, the constraining of the cost of living and maintenance of the strength of the Belize dollar. And we do all this without any increase in taxes,” Prime Minister Barrow said that the government would spend some $226 million for Capital III Projects, in what he claimed as “the continuation of the fabled infrastructural narrative of this UDP government.”
GOB will be borrowing US$36,576,000 from the Caribbean Development Bank (CDB), to pave the Coastal Highway, to which will be added to a grant from the U.K. Caribbean Infrastructure Partnership Fund for £25,050,000 (about US$33.4Million) for a total investment of US$69,956,000 or Bze$140 Million. The leader of the Opposition, People’s United Party John Briceño lamented that the meager few hundred thousand dollars given to upgrade the sugar roads in the North paled in comparison. He also challenged a loan from the Kuwaiti Fund for USD$20 Million to pave 26 Miles of the Caracol road to make it an all-weather road. This especially so since the contract may go to one favored contractor, whose previous public road projects have sparked a storm of controversy with questions of shoddy workmanship, misappropriation of funds and incompletion. GOB will also borrow US$5,941,000 loan from CDB for a second Road Safety Project, which is a follow up to previous CDB loan for US$7,248,000 from January 2013 for the first Road Safety Project, and a second CDB loan of US$4,584,000 on February 2015, also for the Road Safety Project.
On March 17, 2018, during his visit to San Pedro Town for the newly elected United Democratic Party Town Council victory rally, Prime Minister Barrow stated that funds for three new schools on the island had been secured and that GOB was still seeking funding for a hospital on the island. On that day, Barrow reiterated the commitment of the Central Government to the island and spoke about education. He stated that the site where the schools are to be built is being prepared, even though a date for the groundbreaking ceremony was not announced. “These schools will be built by your United Democratic Party Government,” said Barrow. “That’s not a dream, the monies have already been identified, the funds are in the government’s kitty, and those new classrooms and schools will be built.” The funding for those new educational institutions was going to come from a Caribbean Development Bank loan to the tune of $70 million dollars, granted to the Ministry of Education (MOE). The Ministry announced at a groundbreaking ceremony in Belmopan on May 10, 2017 that 35 schools would be built across the country. San Pedro was expected to get a new pre-school, primary, and high school, before the next general elections in 2020. However, the new Budget made no mention of new schools for San Pedro Town or of the possibilities of the much-needed hospital on Ambergris Caye.
To date, this is Belize’s largest budget ever, with the projected spending of $1.256 Billion, is an increase on the 2018 Budget of $1.18 Billion, and the $1.16 Billion spent in 2017. Barrow explained that GOB’s revenue would come from Belize’s Gross Domestic Product, which is expected to top to $4,030 Million for 2019, up from $3.66 Billion in 2017, and $3.99 Billion in 2018. The budget will be debated on Monday, March 25th, and Tuesday, March 26th at the House of Representatives, where the Opposition Party PUP will respond.

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