Belize is a member of the British Commonwealth and is governed by parliamentary democracy. It became an independent nation in 1981 and has a stable and progressive political history. Belize enjoys close ties with the U.S. and UK and steady economic growth. Belize while sparsely populated and still relatively undeveloped has a healthy economy that has been based around agriculture and fishing, but has experienced a large shift toward related businesses in tourism, manufacturing and offshore financial services and has become the basic foundation of Belize's economy.
Belize through its multilateral relationships is developing a manufacturing sector that is labour intensive and export oriented. Belize being on the border with Mexico provides an excellent opportunity for utilizing the facility under the North American Free Trade Agreement (NAFTA) to gain access to the United States, which is facilitated by modern highways. Belize is also a signatory to the Caribbean Basin initiative, CaribCan and the Caribbean Free Trade Area.
Tourism in Belize is booming. In years gone by, planes from Miami, Los Angeles and Houston headed to Belize were full of Belizeans returning home from their visits to the United States. Today, they are full of international visitors and investors who want to experience the Caribbean’s best kept secret. There are plans underway to provide direct flights from Europe and other parts of the world directly to Belize.
In this small, essentially private-enterprise economy, tourism is the number one foreign exchange earner followed by exports of marine products, citrus, cane sugar, bananas, and garments. Belize has been exporting sugar cane to the US and is the biggest crop, with bananas to the UK a close second followed closely by the citrus industry. Seafood is also a big export, with Belize supplying the ‘Red Lobster’ restaurant chain in the US among others with their succulent Caribbean Spiny Lobster and shrimp. The traditional sectors of industry have received many benefits from the influx in tourism and international trade income.
Belize’s government has placed equal emphasis on the Offshore Financial Sector. Since its independence, Belize has introduced some progressive legislation to attract international business and investments which have created a world-class environment for the incorporation of companies that wish to conduct legitimate business internationally all the while ensuring security and privacy.
Foreign investors enjoy a range of incentives in Belize, outlined in its Fiscal Incentives Act of 1990. Foreign-owned real estate privileges, offshore banking and a lack of capital gains tax attract international business to Belize. With Houston airport just over two hours flying time away and Miami airport an hour and a half away, the country's proximity to the U.S. is another attractive feature for foreign investors.
These industries have caused a healthy rate of growth for the country of Belize and while the world’s real estate market has seen dramatic changes in real estate prices over the last couple years, Belize has come to appreciate the fact that prices for the most part have remained stable with some areas seeing a small depreciation in values.
The government's expansionary monetary and fiscal policies, initiated in September 1998, led to sturdy GDP growth averaging nearly 4% in 1999-2007, though growth slipped to 2.1% in 2008 and -1.5% in 2009 as a result of the global slowdown, natural disasters, and the drop in the price of oil. Oil discoveries in 2006 in Belize bolstered economic growth. Exploration efforts continue and production increased a small amount in 2009. In February 2007, the government restructured nearly all of its public external commercial debt, which helped reduce interest payments and relieve some of the country's liquidity concerns. A key short-term objective remains the reduction of poverty with the help of international donors.