INVESTBelize Vol. 1

Volume 1, 2013

Inside Belize’s Oil Industry: The BNE Story Long after oil companies had left and essentially given up on Belize, two oil industry workers stubbornly held tight to the dream.

“Super” bond Explained

Q&A With Mark Espat

Belize’s Thriving

Offshore Industry

INFOTEL A Belize success story in the global BPO Industry

“It is with great pride that I invite you to take a very close look at an unusual opportunity to combine business with pleasure.”

Dean Oliver Barrow

Prime Minister of Belize

4

It is with great pride that I invite you to take a very close look at an unusual opportunity to combine business with pleasure.

With respect to business, your production location in Belize virtually guarantees tariff-free access for goods and services to the markets of all the English-speaking Caribbean countries, and it offers special arrangements for market access to the countries of Central America that should expand rapidly with the ongoing development of SICA. In addition, a production location in Belize offers special access arrangements for exports from Belize to the United States, Canada, and to the countries of the European Union; it also includes access for qualifying business operations to production and related assistance from the European Commission and other European Union agencies.

Belize is also in the process of negotiating special trading agreements with a number of countries in Latin America, including an expansion of existing arrangements with Mexico and the establishment of new arrangements with Brazil. We already have ongoing economic cooperation arrangements with Taiwan.

Facilitating all of this are, on the one hand, a cultural and legal environment that has been heavily influenced by the fact that the country was a British colony until independence in 1981; and, on the other, physical proximity to and strong family ties with the United States, with Miami being only a 90-minute flight away, and with flying-time directly to Atlanta, Houston, w ww.B e l i z e I nve st . o rg . bz

and Dallas being only slightly longer. Communications and transportation services with the rest of the world are excellent. The country’s population reflects the diversity of our origins; but we are one nation, one people. The official language is English, although Spanish is widely spoken; and the legal system follows the British tradition. Belize is a member of the Commonwealth, with the Queen, who resides in the United Kingdom, being the country’s Head of State, represented locally by a GovernorGeneral. The country’s highest Court is the Caribbean Court of Justice, which is located in Port-of-Spain, Trinidad & Tobago.

On the pleasure side, Belize is arguably the fastest-growing tourist destination in Central America and the Caribbean. Its attractions combine a first-class version of the traditional Caribbean sun-sea-sand offering, one that includes the longest barrier reef in the Western Hemisphere, and sea and resort facilities that are second to none, with an unspoiled rainforest interior, filled with birds and animals as a result of the country’s extremely low human population density, with uncounted thousandyear-old ruins from the advanced civilization of the Mayan people who inhabited the area. Quite a few of these sites have now been excavated and are accessible to the general public. Some of them can only be described as awesome. The difficulty here will be to keep your mind focused on business.

My only regret is that I did not extend this invitation to you sooner …

PHOTO BY DEMIAN SOLANO

Hon. Erwin R. Contreras

Minister of Trade, Investment Promotion, Private Sector Development and Consumer Protection

According to the Economic Commission for Latin America and the Caribbean (ECLAC), Belize has fared very well compared to similar economies in the Caribbean region, posting a GDP growth rate of over 2% for 2011, outpaced by only three other CARICOM countries. In fact, since 2008, Belize’s GDP has grown by an average of 2.1%, well above leading, regional economies over the same period.

Belize’s 2012 economic indicators bear even better news for our economy; Belize’s Central Bank data confirm that economic growth rate for this year, 2012, is set to outperform previous estimates, as Belize’s GDP is set to grow at 3.2%, one full percentage point above 2012 estimates, and on par with the 3.3% global GDP growth reported by the IMF’s World Economic Outlook for 2012.

From 2008-2012, our government has led an unprecedented Public Sector Investment Program as a means to lead economic recovery. During this period, the Government focused its spending on infrastructure programs and on a sustained program of social reforms, the hallmark of our Pro-People agenda. Even today, program spending continues unabated, with close to US $200 million in ongoing infrastructure and other programs.

Since March 2012, after receiving a clear mandate from the people of Belize, the Government has shown its seriousness in promoting enterprise development by creating the Ministry of Trade, Investment Promotion, Private Sector Development and Consumer Protection. Parallel to this, the dialogue with the private sector has been greatly enhanced through the establishment of the Directorate of Public/Private Dialogue, and the institutionalization of the annual Prime Minister’s Business Forum, and the Economic Development Council.

Through strategic planning, consultation, and partnership, it is a certainty that a confident private sector will continue to lead our economic growth.

Our Ministry has embarked on a bold strategy for business development upon three main pillars of activity; Promotion of Foreign Direct Investment, Development of Export Capacity, and Small and Medium Enterprise 6 Development. We are driving change through important legislation and policy development geared at private

sector growth. In early 2013, we will launch our renewed National Export Strategy, which will include an assertive five-year implementation plan, complete with the prioritization of national economic sectors; simultaneously, we will continue to refresh and refine our Foreign Direct Investment Strategy.

This ongoing strategy places keen focus on promoting domestic and foreign investment in the important sectors of Internationally Traded Services (ITS), Tourism, Agriculture and Agribusiness, Mining, Petroleum, and Energy as our national priorities. Additionally, our strategies seek to develop new areas for investment, including International Financial Services (IFS), Medical Tourism, and Business Process Outsourcing.

Since 2008, the strengthening of Belize’s export capacity has been clearly evident; Belize’s exports have grown by US $123.2 million since 2008, an increase of 28%: our trade balance now stands at an all-time low of US $-170.7 million. This growth, led by exports of agricultural products and petroleum, is expected to continue well into this decade, as global conditions and changing weather patterns make food and energy security a priority for most nations. Notwithstanding the effects of the global recession, Foreign Direct Investment has continued at a strong pace and is projected to close in 2012 with an estimated 20% increase over the previous year.

All in all, the future for investment in Belize is bright.

This young, diverse, resource-rich nation stands ready to invite you to share in its bounty. It is our firm belief that we represent an opportunity for key investors to participate in our model for sustainable development with the promise of attractive returns. Investment options in Belize abound, with strong opportunities like those in five-star hospitality development, petroleum exploration, energy, real estate development, and services seeking capital and expertise.

To encourage and support these kinds of unique investments in Belize, the Government has a choice of incentives that are designed with the confident investor in mind.

I would like to congratulate BELTRAIDE on this first issue of Invest Belize, and I invite you to live, invest, and retire in Belize with confidence.

w ww.B e l i z e I nve st . o rg . bz

PHOTOS BY DEMIAN SOLANO

B EL I Z E

The Natural Niche for Investment

I am pleased to welcome you, our readers, to this first edition of Invest Belize magazine. We hope that through these pages, we will stimulate your interest in doing business in our beautiful country, Belize.

The business climate in Belize has never been better.

We are proud that the country has achieved an average growth rate nearing 3% for the past two years and is projected to continue and improve upon that trend in the foreseeable future. Our major sectors, Tourism, Agriculture and International Trade in Services, all continue to perform well despite a slow global economy.

Tourism has been on an upswing showing some of the highest growth numbers over the past three quarters, making this a hot sector for investment. This growth has been as a result of strategic marketing programs, combined with the strong brand that Belize carries in the industry. We expect to announce a major investment in this sector bearing a major luxury brand by early 2013, with more to follow.

Projections for agriculture are strong, particularly in the grain sector, as weather patterns in North America have caused uncertainty in production. Through regional agreements, Belize stands to gain from exports to Central America and the Caribbean. For the first time this year, Belize will reach the milestone of 4.5 million boxes of bananas being exported to Europe, with the projection that we will reach 5 million boxes by next year. Sugar exports in 2012 hit an all-time high as farmers achieved record crop yields, and new investment in this sector will see expansion of existing plant capacity, as well as development of a new sugar mill that will produce refined sugar, ethanol and energy from biomass.

In the Energy sector, Belize is finalizing an agreement for linkage into the SIEPAC grid. This important development means that Belize has the opportunity to transition from an importer of power from Mexico to being an exporter of power to Central America. In order to supply SIEPAC, we are inviting companies to look at opportunities in renewable energy from wind and solar and through expansion of our hydroelectric production network.

In 2013, we anticipate investment of some US $30 million in oil exploration. Though production in the Spanish Lookout field has peaked, and new oilfields

Michael Singh

opened at Never Delay have shown mediocre results, analysts still project that Belize could benefit from new finds, and this has driven a frenzy of exploration by major companies. This trend is expected to continue in the foreseeable future.

Within the Services sector, Belize has seen an 80% growth in the BPO sector; our young, educated Englishspeaking population has provided a strong alternative for companies seeking a near-shore advantage. As exhibited in our cover story, companies like Infotel have successfully established contact centers in Belize, paving that way for additional growth in this sector. Likewise, our Offshore Financial Services continue to grow as more and more companies select Belize as a place to incorporate, to establish trusts, and to seek offshore banking services.

In addition to the opportunities already mentioned, Belize remains a major producer of marine products, both from our traditional fisheries, as well from our fast growing Aquaculture sector. Despite the global financial crisis, our banking institutions remain strong and willing to assist in providing financing for viable projects. Our physical infrastructure of roads, bridges, airports, and telecommunication systems make for easy movement of goods, people, and services throughout the country and abroad, and our various trade agreements offer a vast market with tariff free access to most countries in North America, Europe, Central America and the Caribbean.

As you will see from the pages of this magazine, Belize exhibits a wealth of possibilities for investors.

Our close proximity to major North American airport and seaport hubs, our well-educated, English-speaking population, and our abundance of pristine terrestrial and marine natural resources should put Belize on the top of your list as a place for you to visit, enjoy, and invest.

Please enjoy our publication and do not hesitate to contact the Belize Trade and Investment Development Service (BELTRAIDE) or my office at the Ministry for information on your investment needs.

Michael Singh | Chief Executive Officer Ministry of Trade, Investment Promotion, Private Sector Development and Consumer Protection

w ww.B e l i z e I nve st . o rg . bz

9

CONTENTS 16 EXPORT COMPETITIVENESS 18 BUSINESS CLIMATE & INFRASTRUCTURE 22 BELIZE’S TOURISM INVESTMENT 26 CREATING CATALYTIC CHANGE 28 “SUPER” BOND EXPLAINED 30 SUGAR INDUSTRY 36 BELIZEAN SHRIMP FARMS

32 INSIDE BELIZE’S OIL INDUSTRY

38 BELIZE’S NATURAL ENDOWMENT 45 BELIZE, CENTRAL AMERICA REDISCOVERED 46 INVESTMENT INCENTIVES 48 BELIZE IN NUMBERS

12 INFOTEL 10

42 BELIZE’S FINANCIAL SERVICES

BPO Pioneer on Belize’s Regent Street

w ww.B e l i z e I nve st . o rg . bz

50 ABOUT BELTRAIDE 52 SMALL BUSINESS DEVELOPMENT 54 DIRECTORY 58 MAP OF BELIZE

Produced and published for BELTRAIDE

by Idea Lab Studios Ltd., Belize

Demian Solano, Publisher Editorial Team Demian Solano Editor in Chief Nicole Solano Managing Editor Silvaana Udz Copyediting & Proofreading Creative Team Demian Solano Creative Director & Photo Editor Jose Martinez Sr. Graphic Design & Layout eLise Arelie Graphic Designer Advertising Sales, Marketing & Administrative Team Nicole Solano Alicia Fabro Lisa Flores BELTRAIDE CEO, Mike Singh Executive Director, Nicholas Ruiz Deputy Director, Lejia Melanie Gideon PR Coordinator, Nilda Riverol PR Officer, Florence Cayetano Contributors: Jose Sanchez, Jose Trejo, Belize Chamber of Commerce & Industry, Tracy Panton, Senator Audrey Joy Grant, Frantz Smith, Belize Bank International, Glenn Wilson, Belize Sugar Industries, Belize Natural Energy, Lincoln Blake, Lejia Melanie Gideon, Nilda Riverol and BELTRAIDE Invest Belize 2012: The publisher thanks the members, board and staff of the Belize Trade and Investment Development Service for their assistance with this publication. Special acknowledgment goes to Nilda Riverol, Lejia Melanie Gideon and Florence Cayetano.

about THE cover This professional, friendly customer service representative from Infotel attends to countless customer calls per day. It is the caliber and quality of the Belizean employee that continues to attract investment in the Business Process Outsourcing (BPO) sector. Learn more on page 14.

Disclaimer: The contributors and publisher have made every effort to ensure that the information in this magazine was correct at press time. Contributors and publisher do not assume and hereby disclaim any liability to any party for any loss, damage, or disruption caused by errors or omissions. w ww.B e l i z e I nve st . o rg . bz

Copyright: The title Invest Belize is a registered trademark of BELTRAIDE. No part of this magazine may be reproduced or transmitted in any form or by any means without the written permission of the publisher. Nothing that appears, including designed advertising, may be reproduced or reprinted in whole or in part, without permission from Idea Lab Studios.

Corporate/Editorial Offices: Invest Belize is published bi-annually for BELTRAIDE by Idea Lab Studios Limited, 1755 Coney Drive, Tel.: +501-223-6386, Belize City, Belize, Central America. www.idealabstudios.com

11

Reynaldo Malic VP, Call Center Services INFOTEL

INFOTEL BPO Pioneer on Belize’s Regent Street

BY JOSE SANCHEZ PHOTOS BY DEMIAN SOLANO

T

ransforming a working vacation in Central America into a profitable business is possible.

Making it serve as a model for companies in that host country is difficult. But being one of the first to make that entity the brain trust of your entire operation is the story of Infotel.

When the operators of this Business Process Outsourcing (BPO) center first said hello in 2006, Infotel was a pioneer, boldly going where no other BPO had gone before in Belize.

Four U.S.-based businessmen thought about investing in the region, and their Houston-based attorney suggested Belize, the only English-speaking country on the Central American mainland.

Only a few days into the first visit, a decision was made to invest in a BPO for U.S. clients. But before this investment could become a reality, these intrepid entrepreneurs needed to find someone to entrust with their dreams and their investment. What would Monet do if he had an idea for a painting but someone else had

to ease each brush stroke on his canvas for him? While fusing the relationship with their first Belizean employee, Reynaldo Malic, the long working days stretched into the nights, oftentimes including lengthy and detailed discussions over dinner. What better way is there to discuss a Virtual Private Network (VPN), if not over margaritas?

On the day celebrated as the Battle of St. George’s Caye, Infotel opened its doors with a meager nine employees, including Reynaldo and the janitor, and at the end of 2006, Infotel’s investors recognized Belize’s best kept secret wasn’t mother nature’s flora and fauna; it was the caliber and quality of the Belizean employee.

During lunch at the Riverside Tavern, the partners opted to increase the portfolio because the employees owned the job. They applied themselves in a manner that made Infotel appear as a lifestyle.

The 32 employees had outgrown the Barrack Road office space. So with the blessing of a new landlord, Infotel outfitted a newly-constructed building on 13 Regent Street. More than adding floors and employees

w ww.B e l i z e I nve st . o rg . bz

Malic maintains an office at Infotel but his fiduciary duty is to the investors now based in St. Croix, U.S. Virgin Islands.

to its ranks, it was creating order, simplicity, and design for the industry. The Export Processing Zone (EPZ) status was not developed for BPOs, but Infotel successfully lobbied for EPZ status, which is now granted to all BPOs. There are currently twelve BPOs in Belize. Fast forward to September 21, 2012, and during his Independence Day Speech, Prime Minister Dean Barrow acknowledged the industry by saying, “Our business outsourcing and near-shoring initiative continues to pay dividends, and there are now upwards of two thousand persons employed by the ever increasing, FDI-sponsored number of call centers.”

But before it became an Independence Day herald, the Infotel model was still being shaped. The company did not incur long distance charges by using VPN in late 2006 to 2007. It then successfully lobbied Belize Telemedia Limited, the dominant phone provider, for a Voice Over Internet Protocol (VOIP) exception. Despite major transitions in the original investment group, the 14 quality of the Belizean employees, now numbering 84, resounds as it seems their mettle had shifted the

tectonic plates under the machinery that Infotel had become an integral part of.

One of the original partners retired, and the Belizean who was the General Manager of Infotel from 2006 to 2011 succeeded him as the Vice President of the Operations Division. What greater compliment to potential investors than the placement of the Belizean employee at the helm of operations of locations, including Belize, Georgia, Tennessee, and Delaware. Malic maintains an office at Infotel but his fiduciary duty is to the investors now based in St. Croix, U.S. Virgin Islands. The Operations Division is the largest group with over 120 employees in Belize and the United States. Malic communicates with those offices via a hundred emails per day and the office’s VOIP phone lines. Partner visits to Belize have reduced to once a year .

Infotel offers a variety of services to its clients in the financial services sector. The ground floor is for outgoing traffic on the system, to keep in touch with past customers. A section of the floor is set aside for the new product, a collection service for delinquent customers.

w ww.B e l i z e I nve st . o rg . bz

It started with six callers and within thirty days it had grown to 13 callers. This floor also contains a training center outfitted for new employees as well as those selected by the quality assurance section to improve specific skills.

On the second floor, training manuals are developed for all other centers, and skills training is where Infotel has become a leader. The quality assurance team audits, evaluates and grades recorded calls for daily grades issued to the Center’s frontline employees. One former employee is now in charge of quality assurance at a local phone company. Infotel boasts that its customer care model has been adopted by the country’s largest phone service provider, and it was used to revamp their customer service.

In 2013, Infotel hopes to introduce a live chat section.

Today, Infotel employs more than nine times the amount of staff it had in 2006 and performs a variety of services for its clients. These include customer service, transaction processing, marketing, debt recovery, training and quality assurance. Margaritas? Optional. w ww.B e l i z e I nve st . o rg . bz

Skills training is where Infotel has become a leader.

15

Bridging the Gap for Export Competitiveness

B

elize is a young nation that is very much in the midst of seeking an export identity beyond traditional export commodities that have long benefitted from preferential trade. As much as traditional preferential market access has provided a platform from which to sustain foreign receipts over various life lines – CBI, LOME I-IV, Cotonou – its use as a development strategy for post colonial states has fast faded into a trade dimension characterized by liberalization. The significance of this manifestation points to the need to skip natural progressions, so that developing states must now not creep to the doorsteps of the trading arena but rather run – and run fast. The speed at which this can be achieved depends largely on the internal environment. Countries must possess the right policy mix in order to encourage and stimulate growth.

While the acceleration of growth is multi-dimensional and 16 multi-disciplinary, it is understood that it will take both public

and private interests to jointly work towards creating, nurturing, and driving opportunities for growth.

Though it may be argued that taking the lead falls squarely on the government, it is with certainty that it ultimately signals decisively direction and approach through its policies and strategies. It is within this context that the Government recognizes that, although complex, the trading environment is not insurmountable, provided that there is a comprehensive understanding of the support systems needed for enhanced export competitiveness and ultimately a better quality of life for its citizenry.

Investment in support systems is well-underway in Belize, as a key pillar for export success is now being developed. In the space of five years the Government of Belize has provided the Belize Bureau of Standards the human and financial resources to allow the department to effectively permeate standards and quality into the production of w ww.B e l i z e I nve st . o rg . bz

goods and services for domestic and export purposes. Standards and conformity assessment – defined as demonstration that specified requirements relating to a product, process, system, person or body are fulfilled – are important pillars of international trade. In essence the strength of a national standardization system correlates positively with a country’s ability to become an exporter, to innovate, and to participate in multilateral and bilateral trading agreements. (See www.standardsinfo. net/info/benefits/benefits_s1.html) Standards, metrology, testing, and certification procedures can help to build a National Quality Infrastructure (NQI) while at the same time eliminate Technical Barriers to Trade and improve competitiveness through significantly improved regulations; this will allow a developing country to succeed in international standardization activities and to become better integrated into the global trading system.

PHOTO CREDIT: BIGSTOCK.COM

BY JOSE E. TREJO

Standards, metrology, testing, and certification procedures can help to build a National Quality Infrastructure (NQI).

For this to become a reality, governments must first invest in the institutions that will serve as the chariot for full integration into the global trading system. At the national level, this effort has now extended to the physical infrastructure needed to install Belize’s NQI. With the transfer of 2.5 acres of land, the Bureau is now with financial support from the National Authorizing Office/Belize Rural Development Project II and the Ministry of Works, concluding on the physical planning, architectural design, and construction for physical installations. This physical infrastructure will include administrative offices equipped with metrology laboratories across various magnitudes covering grand mass, fine mass, volume, temperature, pressure, and length. This facility once completed and fully operationalized will provide businesses and government with an ideal opportunity to optimize production, health, consumer protection, environment, security, and quality. The effective implementation of the NQI will support sustainable

development and social welfare, facilitating market access.

This facility, which is long overdue, represents not only the commitment from the current administration but also represents the relentless effort by public officers past and present of the Bureau of Standards to lay the foundation for a National Quality Infrastructure in Belize. As the government through the Bureau takes the lead in developing this key pillar for export success, it is the expectation that this will forge a stronger relationship between public and private institutions to face head-on the challenges of the current trading environment in order to level the playing field for developing countries, create economies of scale, facilitate free and fair global trade, and, more importantly, achieve export success beyond traditional export commodities.

Jose E. Trejo | Director, Bureau of Standards, Ministry of Trade, Investment Promotion, Private Sector Development and Consumer Protection w ww.B e l i z e I nve st . o rg . bz

17

Kendal Bridge Southern Belize

OVERVIEW OF BELIZE BUSINESS CLIMATE AND INFRASTRUCTURE CONTRIBUTED BY THE BELIZE CHAMBER OF COMMERCE & INDUSTRY PHOTOS BY DEMIAN SOLANO

S

ince 1981 Belize has been an independent democracy having its own parliamentary legislature, with the Queen of England being the ceremonial Head of State. However, unlike most of its Caribbean neighbours, Belize enjoys the distinct advantage of being a continental-based territory rather than an island nation. The country is bordered by Mexico to the North, Guatemala to the West and South, and the Caribbean Sea to the East.

Since Belize is strategically located in the heart of Central America and the Caribbean, the country can serve as the perfect geographic link between the two regions, presenting multiple opportunities for trade. Belize has weathered the global economic recession relatively well compared to other jurisdictions in the Caribbean Community (CARICOM).

The point is often made that our economy is resilient and has tremendous room for export diversification, value addition, and innovation. As a small and relatively new entrant in the global economic environment, we can and should seek greater levels of growth and productivity.

However, the key to success is recognizing that national development is not confined to solely the work of Government and one or two ministries. Development requires a collective vision and synchronized collaboration between the public and private sectors respectively.

Over the years, Belize has recorded negligible GDP growth, partly bolstered by its recent entry into the petroleum market. Belize has not diversified much beyond tourism and the traditional agricultural commodity exports. This in itself offers an opportunity in areas that have proven to have good growth potential in the region. On the other hand, this has limited the opportunities for foreign direct and local investments. Despite this, a few innovators have managed to add to GDP via other investments. These include services such as International Financial Services (IFS) and business support, call centers and cultural products. They also include producers of value-added items such as pepper sauce, herbal remedies, and dairy products.

Belize has over 20 years experience in the International Financial w ww.B e l i z e I nve st . o rg . bz

Services (IFS) industry. All IFS practitioners must be licensed by the Belize Government, through the International Financial Services Commission. The Organisation for Economic Cooperation & Development (OECD) includes Belize in its White List of jurisdictions that have substantially implemented the internationally agreed tax standard. The country has a conservative international banking sector as well as client services such as international business company formation along with the settlement of trusts and establishment of foundations.

The country understands that it must continue to improve its business operating environment to generate more revenue and increased levels of employment.

The Belize Chamber of Commerce and Industry (BCCI) regards the increase of foreign direct investment in Belize as one strategy to gain access to necessary capital, as well as knowledge transfer in tandem with the creation of employment. Given that local commercial banks are very liquid, there is also unprecedented opportunity for government, 19 in collaboration with the private

sector, to incentivize the release and use of these funds to stimulate the economy in new and creative ways, while also enabling private enterprises to better position themselves internationally and compete globally in niche markets with specialized products and services.

As a country that is in its early stages of development, Belize presents many opportunities for investors, including the possibility to participate in the development process itself. A few primary factors which can distinguish Belize as a Caribbean Latin American country are as follows: • Political Stability: Belize has a history of democratically elected governments throughout our three decades of independence from Great Britain. The country’s election process, both general and municipal, has always been a peaceful one.

20

• English Legal System: Like our former colonial parent, Belize follows the English Common Law legal system and the doctrine of successive precedents through

established case law. This is distinguished from other Latin American countries that use the Civil Law legal system.

• Bilingualism: Belize has experienced a positive and unique demographic change with its human resources. Due to its historic colonial rule by the British Empire, the official language of Belize remains English, but immigration from other Central American countries as well as from Asia has resulted in a young population that is emerging with additional natural fluency in Spanish and Mandarin.

• Favourable Land-to-Population Ratio: Belize has approximately 8,866 square miles of land and a population of 356,600 (2011 World Bank Estimate). Such a relatively low population allows for many options as regards the commercial development of property. Belize’s soil is fertile for agricultural purposes; there is a strong coastline and outlying islands for tourism, retirement, or residential development; the w ww.B e l i z e I nve st . o rg . bz

Northern border provides access to the Mexican market; the Western border provides access to the Guatemalan market; and Belize City is in the process of substantial urban renewal.

• Fiscal Incentive Regime: Belize has a schedule of incentives for investors, including (but not limited to) fiscal incentives allowing the import of essential equipment duty-free, the ability to form export processing zones (EPZ) for tax-free production of goods, commercial free zones (CFZ) that allow for duty-free light manufacturing with minimal taxation, and easy border transit.

• After thirty years of independence, Belize has recognized that policies must be implemented to foster an environment that maintains and grows a sustainable economy. Through public/ private sector dialogue and partnership, Belize has begun actively working to improve its international ratings in such reports as the World Bank’s annual Ease of Doing Business. Priority

for second-home or retirement possibilities, but finding land developed for commercial purposes is not as easy. However, with almost 9,000 square miles in its territory, even after subtracting the abundant nature reserves which give us our reputation for environmental protection, much is left over for commercial applications.

Belize also has a young and Belize is blessed with an trainable labor force, relatively abundance of natural resources, large in the Caribbean region, and archaeological history, and a diver- recent educational efforts have sity of warm and friendly people, as strongly emphasized technical tourists continue to discover on a and vocational training to foster daily basis. This combination should the entrepreneurial spirit and also make Belize one of the most to provide skilled labor to those attractive places for investment and wishing to invest. The University retirement. However, as attractive as of Belize has also embarked on an we are for retirees seeking a warm aggressive strategy to ensure its climate and friendly atmosphere, we ability to promote knowledge, skills, have not adequately marketed our and values needed to enhance the other opportunities. A quick online ability of students and faculty to search for real estate will show you contribute to the economic, social, much by way of residential property and cultural developmental needs sectors have been identified, and the focus they receive opens more obvious opportunities for investment. The newly-formed Ministry of Energy, Science, Technology and Public Utilities has created a National Energy Strategy that seeks, among other things, to transition Belize to a low carbon economy by 2013.

of Belize. While investors will expect to provide training in their specialized fields of business, we do agree that the more general aspects of education should be readily available locally, and we are heartened to see local educational institutions adjusting to meet modern needs.

Labor, land, location, a strong relatable Westernized culture, and a brand-new approach to investment for growth: Belize has all of these advantages and more. Arrive early, beat the rush, and you may just be able to tell those who come later that you helped to shape the environment they met.

The official authority that deals with investment incentives in Belize is the Belize Trade and Investment Development service (Beltraide). To learn more about your options, you can contact this organization, or contact us at the Belize Chamber of Commerce and Industry.

21 w ww.B e l i z e I nve st . o rg . bz

BELIZE’S TOURISM INVESTMENT BELIZE – On the Road to Planned Development and NEW Tourism Investment Opportunities

BY Mrs. Tracy Panton PHOTOS BY DEMIAN SOLANO

S

nuggled between the borders of Mexico and Guatemala and the shallow shorelines of the Caribbean Sea lies the tiny English-speaking country of Belize that is poised to become not only an investment haven but also the destination of choice for today’s ever discerning traveler. Once a British colony, Belize gained its political independence from England in 1981. With a landmass of just 8,876 square miles, this Caribbean paradise in Central America has now become the homeland for a melting pot of both indigenous and modern cultures. Here people and cultures have seamlessly blended into some22 thing uniquely Belizean. Blessed

with wealth untold, Belize has one of the best physical products of any country in the Western Hemisphere.

Home to the Belize Barrier Reef, the longest living barrier reef; lush rainforests and wetlands; exotic flora and fauna; a rich Mayan history; ancient archaeological cities and mysterious cave systems, Belize provides a colourful landscape for life-changing vacation experiences.

For the first time in its fifty-year history, Belize’s tourism industry has made a concerted move for planned development through the commissioning of the National Sustainable Tourism Master Plan (NSTMP). The Plan recognizes this sector as one of the main pillars of Belize’s national w ww.B e l i z e I nve st . o rg . bz

economy. Currently, the industry accounts for 250,000 overnight visitors and approximately 800,000 cruise ship passengers each year. It represents 28% of the country’s GDP, amounting to some $500 million dollars in annual tourism expenditure, and it provides 1 in every 4 jobs.

Over the past decade, tourism in Belize has expanded exponentially with visitor arrivals increasing fourfold. In the first two quarters of 2012, the Belize Tourism Board reported an 8% increase in visitor arrivals, doubling the regional projections of a 4% average growth rate. This is testament to the Government of Belize’s strong commitment to making tourism a national priority.

In accordance with Belize’s national development agenda, the proposed National Sustainable Tourism Master Plan provides a clear road map for both local and foreign investment opportunities that will serve as the blueprint for the industry, guiding Belize towards a low impact, high value tourism product. The Plan outlines well-defined strategies for the sector to effectively compete for a greater share of the global tourism pie through selected source markets, specialized niche market segments, dynamic cross border movements, and increased domestic travel. Further, the Plan also details approaches to support more diversified tourism products, encourage extended lengths of stay, and generate increased tourism receipts. It seeks to deliver opportunities to safeguard meaningful Belizean participation and ownership in this sector and attract viable foreign direct investments within designated tourism zones. Special development areas and well-defined tourism products will serve as catalysts for greater economic activity. If executed as planned, it will result in annual gross tourism receipts that are projected to reach a targeted US $1.2 billion dollars by 2030 through a sustainable and well-managed National Development Program, financed through public and private funding sources.

Potential investments in new tourism infrastructure projects are expected to catapult at some US $1.3 billion dollars that will provide for greater connectivity and more seamless integration between tourism centers, surrounding communities, and unique tourist attractions and sites. The responsible use of its natural resources and preservation of our cultural heritage are fundamental to improving Belize’s competitiveness; augmenting the industry’s 24 unique selling proposition; enhancing the value chain; preserving the

authenticity of the Belize tourism experience; and, ultimately, providing for a better quality of life for all who live, work and invest in Belize. The Plan also focuses the development of important “soft” components that are imperative for success. Strengthening of the tourism governance structure; country branding, quality assurance, and capacity building programs; and improved safety and security measures will extend the multiplier effect and allow for a healthy return on investments. Quantitative and qualitative indicators and market-driven tactics have been incorporated to support Government-led strategies that are PRO-investment.

Six primary tourism products have been prioritized as the building blocks for our macro program, namely: cultural tourism, naturebased tourism, sun-and-beach tourism, cruise tourism, nautical tourism, and leisure and entertainment tourism. The products will offer the investor a diverse tourism portfolio that is structured and properly conceptualized. In short, the Plan outlines a holistic approach for achieving a more equitable balance in developing unique vacation locations that together will converge in a cohesive offering to make Belize a world-class, tourism destination and an investor’s paradise.

As a key industry stakeholder, the Ministry of Tourism & Culture recognizes that optimal results can only be realized through vertical and horizontal integration in this process of national development. We are committed to the full engagement of all stakeholders and partners, confident that our growth model will get us where we want to go. We welcome the chance to explore NEW tourism investment opportunities with you and invite you to come join us.

Mrs. Tracy Panton | Chief Executive Officer, Ministry of Tourism, Civil Aviation and Culture w ww.B e l i z e I nve st . o rg . bz

25 w ww.B e l i z e I nve st . o rg . bz

CREATING CATALYTIC CHANGE

I

t was an honor for me to be asked by the Prime Minister earlier this year to lead the new Ministry of Energy, Science and Technology and Public Utilities (MESTPU) as Minister. Science and technology form the engine of growth. The challenges are real, but the opportunities are both exciting and immediate.

MESTPU has a Geology and Petroleum department with the core function of managing our petroleum reserves. Additionally, the department is involved in the oversight of exploration activities, as well as research activities that will 26 ensure additional efficiencies in seismic operations and drilling. The

Ministry also expects to expand its functions to include the oversight of downstream operations, which is the selling and extraction of petroleum related products.

The Ministry is also responsible for providing regulatory oversight of public utility companies and creating the enabling environment to ensure that these utilities deliver cost effective service to consumers.

The Ministry aims to incentivize the investment climate and encourage public-private partnerships that will expand energy access to underserved communities by increasing renewable energy options such as solar, wind, and biomass as well as increasing energy efficiency. w ww.B e l i z e I nve st . o rg . bz

In 2012, the Government endorsed the National Energy Policy and Framework plan that seeks to transition Belize to a low carbon economy by 2030. While Belize is a leader in the use of renewable energy in its electricity sector (64% of electricity comes from renewable sources such as hydro and bagasse), the country uses fossil fuels for 65% of its energy needs. The country imports 88% of its fossil fuels needs, at a cost of BZ $339 million in 2011.

This represents 10% of GDP and 11% of total imports. The transport sector uses most of the fossil fuels, so a comprehensive review is being done to identify appropriate biofuels which can be a substitute

PHOTO CREDIT: BIGSTOCK.COM

BY Hon. Senator Audrey Joy Grant

in the region, Barbados has 70% ICT penetration for internet, Costa Rica, which is closer to Belize in size and topography, has 30% penetration. Belize has 10% penetration.

Belize City has the largest number of persons connected, with Toledo having the least. With these statistics in mind, we have been actively considering initiatives that will improve internet access for Belizeans at an affordable price.

Here are some of our priorities.

• Foster an enabling policy and regulatory framework • Build human and financial capacity to fulfill the mandate

for fossil fuels. Reducing our dependence on imported fuel will increase our energy security and make our economy less vulnerable to oil price volatility.

The Ministry, in collaboration with the Climate Change Center, has procured over USD $1.2 million in funding from Japan to develop energy-efficient policy options and initiatives that will promote energy efficiency in the building sector.

Likewise, the Inter-American Development Bank recently awarded the Ministry a grant of US $450,000 to conduct an energy efficiency baseline and assessment for Belize. The government of Germany has pledged BZ $52,000 to identify renewable energy pilots in rural communities. Considering that foreign direct aid decreased by 3% in 2011, this is quite commendable.

We will continue to take advantage of all such opportunities, but the Ministry will also be preparing a mobilization strategy to identify the financing necessary to implement our strategic plan.

With regard to Information and Communication Technology (ICT)

• Increase the number of students pursuing advanced studies in science, technology, engineering and math (STEM disciplines) • Increase broadband penetration and use of ICTs • Increase the number of women and girls in ICT • Increase innovation and dissemination of technology in productive sectors • Increase the use of renewable technologies

sector, business entities, educational institutions, social partners, and other stakeholders if we are going to be successful. Our goal is to use planned and concerted efforts in energy, science and technology, and public utilities to expand access to improved and less costly public utilities services as the catalyst for national development, the reduction of poverty, and improvement in the general living conditions of our citizens.

To this end, strategic partnerships with the public utilities is a must.

As a member of CARICOM and SICA, Belize continues to be a strong supporter of Caribbean and Central American regional cooperation. We are committed to exploring opportunities for consultation and collaboration with like Ministries with a view to benefiting from their experiences and expertise. We will also seek to ensure Belize’s participation, where appropriate, in regional energy, science and technology and public utilities initiatives, including those supported by international funding agencies and other donors.

We are excited and energized by the challenges facing our new Ministry as we go about carrying out our mandate. The strategic plan presents a blueprint for addressing those challenges on a short-term and long-term basis.

Our vision statement mandates that the Ministry, working with other Ministries, strategically integrates energy, science and technology into national development planning and decision making.

This is crucial for Belize as science, technology, and innovation have the power to transform economies, accelerate national development, and foster social progress.

There is a need to embark on a communication and public relations strategy that addresses the costs and benefits of pursuing these policies.

The availability of additional technical and financial resources would facilitate implementation of our mandate. With decreasing financial flows from the international community, the private sector will have an increasingly important role to play.

I cannot emphasize enough the need for collaboration and part- Hon. Senator Audrey Joy Grant | Minister nership between MESTPU, other of Energy, Science and Technology government ministries, the private and Public Utilities w ww.B e l i z e I nve st . o rg . bz

27

“SUPER” BOND EXPLAINED Q&A with Mark Espat

BY JOSE SANCHEZ

GoB’s conclusion included the deleterious effects of the global recession, the decline in bond?

MARK ESPAT: The “super” bond is the petroleum related revenues, the obligations sum of Belize’s external commercial debt related to the necessary nationalization of BTL representing some 47% of overall public debt. and BEL, and the increase in the interest rate Prior to 2007, Belize had borrowed monies on the super bond to 8.5%. from various private sector sources, including for example, issuing bonds through the invest- J.S. Was there a restructuring done ment bank Bear Stearns and taking out loans before? Are the reasons the same? from the Royal Bank of Trinidad and Tobago.

M.E. There was a restructuring done in With the objective of securing better terms, 2006/07. The product of that restructuring is these loans were bundled together, and their the current super bond. Many of the loans that varying repayment conditions were synchro- eventually formed the super bond had interest nized to form the super bond which is a 22-year rates of greater than 11% and balloon repayobligation, with a 10-year principal grace ments of principal. Unsustainability was also period and a step-up interest rate starting at the pretext of that last debt operation.

4.25% and gradually increasing to 8.5%.

J.S. Does the bond, or lack of payment, affect the stability of the country’s J.S. Why does it need to be restructured?

M.E. A country, just like an individual or ability to balance its budget?

M.E. The repayment of all debt obligations a corporation, has a debt payment capacity; that is, a limit over which a debt obligation is a function of the national budget. The greater becomes unsustainable. The GoB concluded, the amount that has to be directed to principal after performing an exhaustive debt review and interest payments on debt, the lesser the earlier this year, that the current repayment amount that is available for the recurrent and terms of the super bond exceeded Belize’s capital spending made by the GoB. capacity to pay. Factors that impacted on

28

w ww.B e l i z e I nve st . o rg . bz

PHOTO BY DEMIAN SOLANO

Jose Sanchez: What is the “super”

J.S. Is there anything to fear? Why

shouldn’t the bond affect direct foreign investment?

M.E. Any restructuring, be it for an individual, a company or a government, involves risk. In fact, the risk starts when the original debt is incurred. But the risks of a restructuring include failure to reach an agreement with some or all creditors, loss of credit worthiness, and forfeiture for limited future periods of access to credit from certain sources. Therefore, the decision to restructure should bear the possibility of greater reward for the debtor than risk.

on a sustainable path so that stakeholders can put to rest any concern that repayments will not be made. The key ingredients, then, are sustainability and timeliness.

J.S. The downgrades from rating agen-

cies such as Standard and Poors and Moodys ... What is the direct consequence of those downgrades?

M.E. The rating of sovereign debtors by the rating agencies takes into account their capacity or willingness to repay. Since Belize has always made good on her debt repayments, there can be no question of willingness. As regards capacity, the downgrades J.S. In what way, if any, does the bond reflect GoB’s decision to restructure. Once send a message to investors that this the debt operation has concluded, then the rating agencies will revisit their rating and is a good time to invest in Belize?

M.E. Belize would be considered an adjust these to meet Belize’s capacity to meet “emerging” market. Normally, investors who put payments under the new terms negotiated money into emerging markets are highly sophis- with bondholders. This rating then deterticated. They employ their own risk-reward mines at what cost Belize can borrow from metrics and can distinguish between a public private credit markets, similar to how an sector debt restructuring and the potential for individual’s credit rating would directly affect returns from any investment they may consider the interest rate that individual would pay on making in Belize. So, while the objective is debt. The higher the rating, the less apparent to restructure as quickly and as effectively as risk involved, therefore the lower the interest possible, there is no direct correlation between rate, and vice versa.

GoB’s decision to restructure and the fate of foreign direct investment in Belize. Evidence J.S. Belize’s monetary system: How is it of this position includes the ASR investment pegged? Is it stable? Has it ever been in Belize Sugar Industries Ltd., which has coin- devalued? How stable is it? cided with the current debt operation.

M.E. The BZ dollar-US dollar peg (BZ $2 to US $1) is backed up by the level of foreign J.S. Does an inability to pay or a missed currency holdings of the Central Bank of Belize.

All stakeholders including international payment ever have a consequence on a foreign business’ investment in Belize? financial institutions like the IMF concur M.E. Obviously, there is a level of concern that this peg provides stability and serves that will arise by all stakeholders, domestic Belize’s macroeconomic interests. The and international, when government misses debt restructuring does not jeopardize this a payment on a debt obligation. On the other peg in any way. The goal as I’ve said is to hand, that concern is also alive when debt levels encourage investors, while making them appear to be unsustainable. The objective of a understand this issue that is fully vented in debt restructuring is to place the public debt the international media. w ww.B e l i z e I nve st . o rg . bz

29

Securing the Future of Belize’s Sugar Industry CONTRIBUTED BY BELIZE SUGAR INDUSTRY LTD. PHOTOS BY DEMIAN SOLANO

Hon. Senator Godwin Hulse & Jonathan Bamberger, ASR at Belize Sugar Industries Ltd., Orange Walk

T

he Belize Sugar Industries Limited (BSI) traditionally has been recognized as one of the best-managed sugar milling operations, not only in this region, but also worldwide. For years, however, the company had been under severe pressure from lenders to restructure its finances or risk complete withdrawal of its banking facilities. Without financing, the company, and by extension the cane farmers and sugar industry, would have been faced with a huge crisis.

The company needed a sound strategic investor with the requisite resources, capacity, financial strength, and willingness to provide not only the initial cash-equity injection, but also the support of new long-term finance to secure increased output of both cane and sugar. By securing a strategic partner and future financing, BSI would be ensuring the survival of the sugar industry by promoting expansion and improving returns for the industry, which would ultimately benefit all stakeholders.

American Sugar Refining Limited (ASR) expressed interest. Discussions and negotiations followed, then visits, analyses, and due diligence. Finally in October 2012, the process came to a close, and the investment transaction was successfully completed. ASR secured a majority equity shareholding of 78.6% in BSI for a total consideration of US$64.8 million. The existing shareholders in BSI, including BSI Employee Holdings Limited, hold the remaining 21.4% of the shares at the date of publication.

The ASR Group is one of the world’s largest integrated sugar businesses with five sugar mills in the United States, Dominican Republic, and Mexico. It has technological know-how and experience and (very importantly) enjoys great market access. Three of the sugar mills have refineries, and one operates the largest biomass cogeneration facility in North America. ASR Group farms over 400,000 acres of sugar cane land and harvests around 12.5 million tonnes of sugar cane per annum. ASR is the largest cane refiner in the world, with refineries in the United States, Canada, the United Kingdom and Portugal having a total refining capacity of around 6.2 million tonnes of sugar. ASR also produces a wide range of specialty sugar and is the largest global marketer of Fairtrade certified sugar.

ASR’s significant experience in sugar cane farming, milling, and refining, as well as its distribution operations in the premium sugar markets of Europe and the

United States, make it an ideal investor. This allows BSI, its employees, growers, and other stakeholders to achieve the objective of securing the Belize sugar industry’s full potential.

ASR is fully cognizant of the economic importance of the sugar industry to Belize and is committed to the development and productivity improvement of the cane and sugar sector. ASR’s long-term commitment to BSI includes the supply of international operational and project support expertise to advise BSI management, drawing on experienced staff from throughout its global business operations. The intention is to boost cane farmer output by providing advice on best farm management practices to increase productivity and lower costs. Visits will be facilitated to ASR’s other cane farming operations for a firsthand look at its planting and cane cultivation practices. Extension services will also be provided to cane farmers, including the identification of financing for key activities on a revolving, selfsustaining basis.

BSI is committed to a strategic plan aimed at sustaining profitability through increased operating efficiencies and increased production capacity, capitalizing on marketing opportunities, and increasing and diversifying its value-added products.

All key industry stakeholders must remain committed to working together to meet the challenges of competing in the dynamic global sugar market. A successful sugar industry will provide a boost to the Belize balance of payments mainly through reduced debt servicing outflows and through increased production and exports. Therefore, the Government of Belize remains fully engaged and supportive of efforts to ensure the sugar industry remains viable in a more competitive global environment.

By securing a strategic partner and future financing, BSI would be ensuring the survival of the sugar industry.

w ww.B e l i z e I nve st . o rg . bz

31

PHOTO COURTESY BELIZE NATURAL ENERGY

32 w ww.B e l i z e I nve st . o rg . bz

Inside Belize’s Oil Industry: The BNE Story CONTRIBUTED BY BELIZE NATURAL ENERGY

An Impossible Dream

Hidden on a back road in Belmopan City, semiobscured by trees and brush, is an old rusty pump jack–the long abandoned Eagle One well. It stands testament to the challenging pursuit for petroleum in Belize, a time littered with failure and frustration. Many are surprised to learn that the history of oil exploration in Belize stretches back to the 1950s, when oil companies entered the country to search for black gold. Fifty dry wells later, the petroleum proved elusive. The oil companies departed, and industry experts were doubtful that any significant oil reserves would ever be found in Belize.

Long after the oil companies had left and essentially given up on Belize, two oil industry workers, Mike Usher and Susan Morrice, stubbornly held tight to the dream. They refused to let it die and be forgotten. Irish-American Susan Morrice (geologist) and Belizean Mike Usher (surveyor) had both been involved with oil companies drilling in Belize and internationally, and together they held an unwavering conviction that oil could and would be found to the benefit of their beloved Belize.

It was in this spirit that Belize Natural Energy (BNE) was founded, with the deep rooted belief that the country of Belize is blessed with sufficient oil and gas resources to positively transform the entire country. In 2003 the Government of Belize and BNE

signed a Production Sharing Agreement for oil exploration in the northern part of the Cayo District.

Needle in a Haystack

By 2005, with the support of U.S. and Irish investors, the Company was able to raise enough capital to drill two wells. It generally takes, however, the drilling of several wildcat wells before a discovery is made. With Belize’s history of failed exploration efforts and the drilling odds against them, BNE had the daunting task of deciding where to drill a dinner-plate sized hole within 529,000 acres of land in their concession area. Selecting the wrong location would leave the company with two holes in the ground worth millions of dollars.

On June 24, 2005, BNE struck oil … with the very first well drilled.

Belizean Hero

BNE struck oil in Spanish Lookout in June of 2005, becoming the first company in Belize to discover oil in commercial quantities. Where so many had failed before them, Susan and Mike had achieved the impossible dream.

When oil came gushing from that first well, the success was bitter-sweet. Mike Usher, who had been a driving force behind the discovery, whose belief was contagious and who wanted so badly to see his country positively trans- 33 formed by the oil, was not present on that momentous day.

w ww.B e l i z e I nve st . o rg . bz

Mike had passed away a year before oil was discovered. currently under appraisal (Rock Dondo and Cayo West).

January 2011 marked the end of BNE’s exploration His legacy lives on, as all wells in the Spanish Lookout period under the Production Sharing Agreement signed Field are named “Mike Usher” in his memory. with the Government of Belize in 2003. At the end of 2011, BNE was producing approximately 3,000 barrels Industry Pioneers BNE’s oil discovery was an unquestionable success, of crude oil per day from 11 producing wells in the but one fraught with new challenges. When oil was first Spanish Lookout Field and 300 barrels per day from five discovered, the oil industry simply did not exist and the wells in the Never Delay Field (Never Delay production country was devoid of essential industry-related infra- began in March 2011). structure. There were no pipelines, storage tanks, crude trucking services, or appropriate port facilities. The Socio-Economic Impact Company had to literally build the industry from the From 2005 through 2011, BNE’s operations ground up. BNE was up to the task, and in January of earned the Government of Belize in excess of a third 2006 the first shipment of Belize Light Crude (BLC) was of a billion dollars in revenues. In addition, BNE has delivered to the U.S. Gulf Coast. contributed significantly to health and education Today, BNE has developed the capacity to explore, support activities and community development. Sepaproduce, and market oil and gas in a cost-efficient, socially rate and apart from BNE’s charitable contributions, and environmentally sound manner. over the past four years the Belize Natural Energy Trust (BNET) invested over US $5.4 million dollars to improve the quality of life for Belizeans.

BNE’s Discoveries BNE has also invested heavily in training and Despite the warnings of industry experts who cautioned against drilling in Belize, BNE made four discov- capacity building for its employees. Currently, approxeries, two of which were declared commercial (the Spanish imately 96% of BNE employees are Belizean including Lookout Field and the Never Delay Field) and two are the Chief Executive Officer and Chief Financial Officer.

PHOTOS COURTESY BELIZE NATURAL ENERGY

(BNET) invested over US $5.4 million dollars to improve the quality of life for Belizeans.

34 w ww.B e l i z e I nve st . o rg . bz

conscious manner that fosters teamwork, creativity, and professionalism. Suffice to say BNE holds itself to a high standard and the work has not gone unnoticed: “It is my opinion that the BNE operation is well More “Firsts” for Belize Natural Energy above average in their industry. Both management and and Belize BNE completed construction of a gas recovery and employees are knowledgeable in their roles and have processing plant in 2009 and, in March 2011, the first an interested and caring attitude with regard to safety locally produced Liquefied Petroleum Gas (LPG) Depot and risk control. Everyone involved is truly interested in improving the operations in order to make BNE a opened to the public.

BNE has now established four LPG franchises: world-class company.” —Jeff Citrone Loss, Control Burrell Boom, San Ignacio, Benque and Punta Gorda. Specialist of IMA Insurance Colorado BNE’s LPG (Belizean Butane/Propane) is a quality “BNE is a small oil company in international terms product sold at a competitive price, lower than imported butane. Providing this essential and affordable product that is operating at a high level of social and environis aligned with BNE’s Mission to “positively impact the mental management. Over the three years that external Belizean people.” Today, Belizean Butane/Propane is environmental and social reviews have been conducted, in high demand with 100% of production sold. BNE is a systematic approach to environmental and social proud to supply an affordable Belizean product made management has been developed, with clear expectations and accountabilities, supported by the necessary from Belize’s very own oil! training and resources.” —Jill Shankelman & Robert A Belizean Company WITH World-Class Coyl, BNE’s Social and Environmental Review, 2011

All managers are Belizean (with the exception of one) and 50% of the Management Team is female.

Standards

BNE’s mission is to positively impact the Belizean people by efficiently finding, producing, and marketing oil and gas in a healthy, safe, environmentally and socially

Today, Belize Natural Energy remains the only company in Belize to have successfully discovered, produced, and marketed oil and gas.

35 w ww.B e l i z e I nve st . o rg . bz

Belizean Shrimp Farms Now Tapping into Seafood Market Niches

BY Lincoln Blake and Frantz Smith

After Belize achieved independence in 1981, the country developed a policy to create new industries that would take advantage of the world’s appetite for tropical foods. These new products included papayas, hot peppers, and fish, which gained importance as export crops. With the quest for continued diversification, shrimp farming also gained the attention of a number of Belizean businesspeople. Shrimp aquaculture in Belize started in 1982 when an American entrepreneur by the name of Dr. John Snell and his biologist Mrs. Linda Thornton achieved proof of concept for growing the Pacific White Shrimp (Litopenaeus vannamei) in Belizean waters. Dr. Snell had the backing of a Belizean Chinese family as well as investors from Taiwan who financed the building of a farm called General Shrimp on the Sennis River in South Stann Creek. General 36 Shrimp, while seen as a pioneer, was before its time and never became a commercial leader in the shrimp market.

However, other investors saw the marketing opportunities and potential for growth of this industry in Belize.

The Gold Rush

After the early work by Dr. Snell, well-financed companies rose to become the backbone of the shrimp aquaculture sector in Belize. By the 1990s, large establishments including the Nova Companies Belize Ltd., Paradise Shrimp Farms Central America Ltd., and Aqua Mar Belize Ltd. shrimp farms were investing heavily and steadily producing bumper crops. Besides the early adopters in the industry, this growth attracted new investors who brought greater technical sophistication into the Belizean shrimp farming community. The new entrants included Texmar Belize Ltd., Royal Maya Shrimp Farm Ltd., and Belize Aquaculture Ltd. Revenues of shrimp farming grew to rival the foreign exchange earnings of the established industries such as sugar and citrus. Central Bank records show that between 2003

w ww.B e l i z e I nve st . o rg . bz

PHOTO COURTESY ROYAL MAYAN SHRIMP FARMS LTD.

Early history of the industry

included floodings in Thailand and the increased demand for value-added shrimp in Japan after the 2011 tsunami.

One important result of the challenges faced by the industry over the years is that the sector has diversiThe Crisis The years between 2005 and 2008 posed a chal- fied its markets. Whereas Belize once only focused on lenging time for the shrimp farming community in the U.S. markets, the farms have now ventured into Belize. Prices during this period started to decline dras- the Mexican, European and Caribbean markets where tically, with competition from low-cost producers like demand and pricing are more favorable to Belizean Indonesia, Honduras, Ecuador, Thailand, and Vietnam producers. Some farms are regularly visited by Mexican that caused an increase in supply of shrimp on the inter- importers who buy entire crops that they chill on the national market. These low prices caused the closure ponds’ sides, pack, and ship overnight to Mexico City.

The recent trends in shrimp farming have revealed of several Belizean shrimp farms. For the farms that remained open, this crisis period made them find new continued opportunities for shrimp farms in the methods and efficiencies that could be applied in their country. Most of the Belizean shrimp farming compafarms to allow them to survive the continuous drop nies are either planning or are engaged in expansion in prices. However, The World Food Crisis of 2008 to take advantage of opportunities which include marked the start of a transition from a buyers market the opening of specialty markets in the Caribbean to a sellers market for shrimp. Prices started to increase and Europe. Partnerships are already being forged from just over US $4/lb to close to US $7.50/lb. After by some of our producers such as Belize Aquaculture the World Food Crisis, prices dropped to US $3.50/lb Ltd., which has managed to attract a major European because of temporary oversupply, but the local farmers shrimp supplier to invest in its company for expansion were prepared for the drop with their improvements in and increased production. These are all indications that shrimp farming in Belize has matured over the years productivity and efficiency in their farms. and is poised to take advantage of emerging opportunities in the international market.

The Consolidation of the industry Around 2010, prices again began to rise. This was because Whitespot Syndrome Virus was beginning to Lincoln Blake & Frantz Smith | Investment Unit, Ministry of have severe effects in Asia. Other factors which have Trade, Investment Promotion, Private Sector Development and contributed to increased shrimp prices since 2010 Consumer Protection and 2005, shrimp aquaculture was earning close to BZ $90 million dollars per year for Belize.

PHOTO CREDIT: BIGSTOCK.COM

Shrimp aquaculture was earning close to BZ $90 million dollars per year for Belize.

37 w ww.B e l i z e I nve st . o rg . bz

BELIZE’S NATURAL ENDOWMENT READY FOR INVESTMENT

BY FRANTZ SMITH PHOTOS BY DEMIAN SOLANO

O

38

In addition to its soil and its water, Belize also has a number of minerals important to industry.

ne of the benefits of being a small country like Belize is that it is relatively easy to quantify the resources and develop plans for the different landscapes of the country. In our country, forestry and agricultural companies and the Colonial government were the planners as well as the movers and shakers of the economy from the mid-nineteenth century to the time of Independence. However, Government technocrats and other planners in Belize have played an important part in creating a business agenda over the past 30 years.

This was true for the aquaculture and papaya industries and the sugarcane expansion that the country experienced after Independence.

These agendas have often involved matching the natural resource base w ww.B e l i z e I nve st . o rg . bz

with the desired economic activity. This process continues to be refined. We will discuss the initial part of this process: assessment of the various resources that Belize has available for the development of enterprise.

Besides its people, the three most important resources that Belize has are its soils, waters, and geologic resources. Our biological and cultural resources are another important set of resources but will be discussed later. The main focus here will be the soils, waters, and geologic resources. Soils and waters of Belize are important because they support the sugarcane, papaya, banana, citrus, shrimp, and tourism industries, which bring in foreign exchange to the country. They also support the corn, cacao, chicken, beans, and beef industries. Our oil

is important because it is a direct source of foreign exchange. The other geologic resources are important for the construction of roads and infrastructure.

Soil Resources

The soils of Belize have been difficult to understand because they are very heterogenous and can change dramatically at sites 20 feet apart. Some are very fragile and should be left under forests while some have to potential to be highly productive and profitable to farm.

1. Soils of the Maya Mountains There are two types of soils of the Maya Mountains. The Mountain Pine Ridge area is underlain by very old and highly leached acidic soils. These soils are not good for agriculture but produce

good stands of Caribbean and Honduran Pine. There have been interests in using these lands to produce lumber for Carbon Credits in Belize. In the area of the Maya Mountains that are not dominated by pine, the soils are similarly poor and not good for agriculture. These soils are called the soils of the rugged land system in the Maya Mountains.

These soils are mostly derived from metamorphic rocks and are shallow and stony but produce good stands of mahogany and secondary hardwoods that are harvested.

2.

Clays of the limestone uplands and foothills These are the soils underlain by limestone’s rich parent materials.

In areas where the terrain is rugged, these lands are reserved for the production of precious woods such w ww.B e l i z e I nve st . o rg . bz

as granadillo and chechem. Where the limestone structures are small hills such as in the area between the Belize and Sibun rivers, these soils are used for milpa agriculture and extensive cattle ranching.

3. Soils of the Toledo beds In the southern lowlands the soils are derived from shales, mudstones, and calcareous sandstones making for fertile, highly productive agricultural soils. Currently, cacao, rice, beans, and corn are produced on these lands. These lands offer good opportunities for horticultural crops for export.

4. Pine ridge soils of the coastal

plains These deposits were washed down from the Maya mountains and are 39 poor for field or horticultural crops.

However, it is on these soils that Belize’s highly productive and excellent quality shrimp are farmed. These soils will also grow mangoes and cashews.

the reef. These swamps are nurseries for marine fish and invertebrates such as shrimp and lobster and are best kept for their conservation value.

5. Dark limestone soil of the

8. Riverine alluvial soils These could be considered the crown jewel of Belizean soils. They are brown, loamy, and highly productive. These occur along the major rivers and have been used for rice, cattle, and vegetable production.

With adequate levels of investment, these soils can grow anything that the climate will permit. This ranges from fruits, vegetables, and grains to livestock and timber.

northern coastal plain These nutrient-rich clays are the backbone of the sugarcane industry of the north. They are also found at various places such as Spanish Lookout and north of the Sibun River.

These soils require heavy machinery to plough and harrow but will produce good yields of corn, rice, sorghum, beans, etc.

6. Reddish limestone clays of

the northern coastal plain Occurring primarily around Corozal Town, Progresso, and Hill Bank, these soils are fertile and have only been used to a limited extent. There is much potential in this resource.

7. Swamp soils

9. Young coastal soils

There are a number of soils containing poorly weathered fragments of limestone, quartz, corals, shells, and sand. These occur along the coast and vary depending on their parent materials. These soils form the beaches and coastal resources.

Belize’s swamp soils form an important part of the coastal ecosystems Water resources that function as a filter for waters Water is another important moving from the mainland towards resource that is found abundantly in

40 w ww.B e l i z e I nve st . o rg . bz

Belize. In between the Rio Hondo and the Sarstoon River, Belize has thousands of streams that feed into eighteen major rivers. In the flat northern half of the country, these rivers flow sluggishly to the northeast. In the center of the country is the Belize River. The Belize River is actually a confluence of the Mopan and Macal Rivers, which traverse the western Cayo District. These are the most important watercourses in the country. The Belize River supplies a lot of fish and much of the potable water in the country. It also supports three important hydroelectric facilities, which have been important in the energy security of Belize. There are more opportunities for hydroelectric generation on the Macal River. In the south of the country, the rivers flow with stronger currents westward to the Caribbean Sea and have been used for irrigation, fishing, tourism, and power generation.

At locations where rivers empty into the sea, the mixture of freshwater and marine waters creates areas of high biological productivity.

These are called estuaries. Estuaries

are some of the most biologically productive areas in Belize and much energy is transferred from the sea to the land in these areas. Major estuaries occur at the Haulover in Belize City, Corozal Bay, and the Rio Grande. Smaller estuaries on the Placencia lagoon have been used to support a major aquaculture sector in the country. Apart from flowing into estuaries, the rivers of Belize also flow into lagoons, mangrove swamps and freshwater wetlands, which have proven to be attractive centers of recreation in the tourism industry.

In the ecosystems used by the tourism industry, use of the waters transitions from agricultural and industrial uses into recreational activities. The most important waters of coastal Belize occur in the vicinity of the Belize Barrier Reef.

In these areas, the waters have been stripped of nutrients by the plants in the mangrove and seagrass ecosystems and are nutrient-poor.

This is why the waters of the reef are very clear. It has been said that a barrier reef is like an oasis growing in a desert. This analogy is apt because the reef is growing in nutrient-poor waters while our forests, such as the Mountain Pine Ridge, grow on poor soils.

deposits for high end construction and decorative uses in building construction. This mineral is found in the Mountain Pine Ridge area of the country. One gold company also has a gold mining concession in the Mountain Pine Ridge. Besides these resources, the Maya Mountains have been mapped and areas with high concentrations of molybdenum have been identified.

Limestone and dolomite for agricultural use are also produced in Belize. In fact, the entire northern half of Belize occurs on the limestones of the Yucatan Platform. These resources have traditionally been used in road-building but enterprising business people have used this resource to produce agricultural lime to neutralize soil acidity. Belize also contains interesting silica deposits on the Sibun and Sennis Rivers.

By far, the most important geologic resource produced in the country is petroleum. The main producing oilfield is in Spanish Lookout and produces petroleum comparable in quality to Texas Sweet Crude. It has been estimated that this field contains 16 billion barrels at a depth of 3,000 feet. Export

of petroleum from the country is around BZ $300 million per year, making it the second most important source of foreign exchange for the country after tourism.

Synopsis

It is clear that before breaking ground, an investor should match the soil, water, and geologic resources s/he has with the outcome s/he desires. The first step of this should include visiting BELTRAIDE which can guide investors to the proper resource offices in Belize. This may involve visiting the Ministry of Natural Resources and Agriculture to consult with the experts who have developed deep understanding of the resources of the country and can provide critical advice to investors. BELTRAIDE can then facilitate meetings with successful investors in the agricultural and tourism industries as well as provide guidance in getting the necessary permits and licenses before implementing a project.

Frantz Smith | Investment Unit, Ministry of Trade, Investment Promotion, Private Sector Development and Consumer Protection

Geologic resources

In addition to its soil and its water, Belize also has a number of minerals important to industry. The most utilized of these resources are the rocks and gravel used in the construction industry. These types of resources are sourced primarily on the Belize and Sibun River, which are close to the urban centres. Sand for construction is also a major resource on the mainland of the country.

Besides the Belize River, the other rivers in the country can supply an expanding mining sector if demand for construction materials increases.

As well as stones for construction, Belize also has notable granite

41 w ww.B e l i z e I nve st . o rg . bz

BELIZE’S FINANCIAL SERVICES INDUSTRY OFFSHORE BANKING SECTOR CONTRIBUTED BY BELIZE BANK INTERNATIONAL

known as the International Business Companies Act. Nestled in the relatively quiet cove of the Yucatan At that time, both residents and non-residents had the peninsula lies the only English-speaking country of ability to incorporate a legal entity (the IBC) for the Central America. Belize, a former British colony (once purpose of conducting business. This entity, however, known as British Honduras), is home to approximately would not be subject to local Belize taxation of any 315,000 people and, for such a small population, is the sort, nor would it be subject to the requirement to home for a myriad of cultures, such as the Mayans and make annual returns. Documentation of the compatheir descendants, the Garinagu, Hispanics, Mestizos ny’s shareholdings and directorship was not required and Creoles, the descendants of the black slaves and to form part of the registry paperwork on the company, their former white European masters. Even the Chinese/ and, in fact, there was little interaction with the IBC Taiwanese now have fairly significant representation in Registry that was required of the IBC, save for the payment of its annual incorporation fee. numbers in the population.

Following up the relative success of the IBCs was the establishment of the Belize Trusts Act two years later. The Belize Then In 1990, Belize took a fairly bold step and committed Trusts law proved to be quite effective in putting Belize to the development and commencement of an offshore or on the map of asset protection recognition, as many prac42 international financial services industry. It introduced, titioners found it to be quite useful in staving off attacks through the National Assembly, the law that is now by greedy creditors and governmental interference. The w ww.B e l i z e I nve st . o rg . bz

PHOTO CREDIT: BIGSTOCK.COM

BELIZE:–A General Overview

laws of Belize in relation to Trusts allowed for the kind of confidentiality and privacy that people wanted in the arrangement of their financial affairs.

Other Offerings

The Foundations Law was one such law passed to widen the scope of services available to the ultimate client by service providers in Belize. The International Financial Services Commission of Belize, Belize Now: How Is It? 9/11 changed the lives of everyone in the world, but however, has wisely opted to furnish us with a more more so in that the offshore industry, globally, began robust listing of services to choose from. The IFSC seeing a greater shift of attention towards anti money- has put together a slew of licenses that are most relelaundering, and the watering down of privacy laws, vant to the clients for whom they were created. They generally. As an example, the issue of attorney-client are as follows: privilege in the United Kingdom is now only a historical • Formation or management of international busifact, not an actuality. ness companies or other offshore companies. This In Belize, however, there remains a high level covers both IBCs and the recently enacted Interof respect for the privacy and confidentiality of the national LLCs client, be it an IBC or a Trust. In the case of an IBC, the client’s information is not filed with the IBC Registry and is not available to the public. It is even • Trust formation and management of offshore trusts more confidential with the Trusts because the trust and provision of trust services. This also covers deed is not even filed with the Trusts Registry; the Foundations, enacted in 2010 only jurisdiction recognized by the trust arrangement is the Belize Supreme Court, and there are even • International asset protection and management excluded claims of action against the Trust Deed.

So too are there limitations in respect of Belize • Money transmission services International Foundations, a recent addition to the arsenal of offerings under Belize law. One • Payment processing services of the last pieces of legislation for the calendar year 2010, it is quietly proving to be an attrac• Trading in foreign exchange tive alternative to Trusts, particularly for persons who hail from civil law jurisdictions. In this Act, • Trading in financial and commodity-based derivait is statutorily provided that “… no person shall tive instruments and other securities (e.g. futures, disclose any of the documents … their contents options, interest rates, foreign exchange instruments, or the information contained therein relating shares, stock, contracts for differences, etc.) to the establishment, administration, maintenance, business undertaking, affairs or property • Money brokering of a foundation to any other person.” That section, Section 103, goes on to identify the documents • Money lending and pawning as the Foundations Charter, By-Laws, rules and regulations, any document relating to the exercise • Money exchange of any function or duty conferred upon a Foundation council, or council member, or protector, or • Safe custody services disclosing deliberations of the council, member, protector, or directors of members or protec• Brokerage, consultancy, or advisory services in any tors. It also covers any documents relating to the of the above services finances, investments, assets, income, expenses, profits, losses, appreciation, depreciation, value, Each of these licenses attends to different net worth, or business activity of a foundation, its needs, but, ultimately, the needs attended to are founder, or any beneficiary. What is of note is that those of the clients that the providers service. The it also defines information to include any papers, IFSC is to be commended in the work that it does. deeds, declarations, appointments, minutes, No doubt there is more development in store for notes, etc. Even electronic and computer data are the future, but the present is far from Mother covered by the definition; essentially anything Hubbard’s cupboard. The shelves are fully stocked that informs another party not privy to the details and ready for the sampling. Come taste of our 43 of the Foundation is covered. delicacies. Enjoy. w ww.B e l i z e I nve st . o rg . bz

BELIZE, CENTRAL AMERICA REDISCOVERED

BY GLEN C. H. WILSON PHOTO BY DEMIAN SOLANO

PHOTO BY DEMIAN SOLANO

I

knew little about Belize when I first started in business in Switzerland in 1995. It was more by accident than design that I started, in 1996, using the Belize International Business Company (IBC) as a vehicle for my clients to shelter assets “Offshore.”

Belize was in its infancy as an “Offshore Financial Center,” the IBC legislation was relatively new, and the International Trust legislation was developing.

The International Insurance and Mutual Fund legislation were both being drafted. Licensing was just around the corner. Belize was about to burst forth on the international scene.

What a great time to become associated with the birth of what is now a flourishing jurisdiction that is competing with other well-established centers!

Since 1973 I had worked in the financial services industry in the U.K., Bermuda, The Cayman Islands, and Switzerland. In 1995 I established a trust company in Switzerland. I needed a jurisdiction that I could use to service my clients.

My criteria were Efficiency, Simplicity, and Affordability. Belize fitted the bill; it was emerging and I could grow with the jurisdiction.

That is exactly what happened. In 1996 I established Bay Trust Corporate Services, and in 1999 Bay Trust International Limited was incorporated and licensed to do trust business.

During the years the presence in Belize grew to a staff of 11, servicing clients though various licensed entities.

My faith in Belize grew and in 2006 I decided to phase out my Swiss operation and transfer all the business to Belize. This transfer was completed in 2008 at which time I came to live in Belize.

Throughout the years as the business has grown I have found the authorities to be sympathetic in their advice and assistance, and without their cooperation I would not have been able to develop as I have.

Belize is a jurisdiction of opportunity to benefit both clients and practitioners. There is a good availability of staff who are either qualified or willing to learn and qualify. With the advent of a Belize Chapter of The Society of Trust and Estate Practitioners, Belize can move forward with confidence.

The legislation has given me the opportunity to expand a business that is both efficient and effective and that operates within the law to benefit clients worldwide.

We are now housed in The Matalon Business Center, a state-of-the-art business center of which we are proud to be part.

I can say that Belize is truly Central America Rediscovered and is a jurisdiction that should be used as well as, and instead of, the traditional jurisdictions of the Caribbean.

45 Glen C. H. Wilson FCIS TEP | Consultant

w ww.B e l i z e I nve st . o rg . bz

A GUIDE ON BELIZE’S INVESTMENT INCENTIVES

BY Lejia Melanie Gideon

Program, Retired Persons Program, and the Offshore Financial Services Incentive Program.

Fiscal Incentives Program

The Fiscal Incentives Program was instituted to encourage both existing and potential investors through the granting of Customs duty exemption, inclusive of solely the Import Duty and Revenue Replacement Duty.

In particular, the Fiscal Incentives Program places key emphases on fostering agriculture, agro-industry, aquaculture, manufacturing, and tourism.

Export Processing Zone Program

The Export Processing Zone (EPZ) Program was instituted with the aim to attract both local and foreign investments to boost production for export markets through the granting of a full-fledged tax holiday and Customs tariffs exemption. The EPZ Program places key emphases on value-adding activities, solely for the export market, such as agro-processing, manufacturing, assembling, and data processing.

Free Zones Program

The Free Zones Program was instituted to attract local and foreign investors for the development of trade in retail and wholesale merchandise, light manufacturing,

w ww.B e l i z e I nve st . o rg . bz

PHOTO BY DEMIAN SOLANO

B

ordered by Mexico in the North, Guatemala in the West, and the Caribbean Sea in the East, Belize is a unique, vibrant country in Central America whose British colonial history strongly links it to the Caribbean. It has a hard-working, diverse, friendly, bilingual (with English being the official language), and well-educated workforce that bolsters an economy focused on growth. Quite the popular tourist destination for its eco-friendly, pristine natural resources, Belize’s rich soil, year-round tropical climate, and long coast line creates an attractive and sustainable climate to foster niche products and services that cater to niche markets, such as adding values deriving from nature.

Belize’s natural assets, progressive development policies, pro-business investment climate, and long-time democratic stability have created an ideal destination for investors seeking a sustainable harbor amidst the waves of global economic hardship. The Government of Belize is wholly committed to supporting the country’s niche-oriented development model, while preserving the country’s distinctiveness and fostering investor confidence. Likewise, the wide array of investmentrelated incentives have all continued to firmly reinforce the country’s business-friendly reputation. Notable 46 incentives include the Fiscal Incentives Program, the Export Processing Zone Program, the Free Zones

assembling, and packaging in the designated zones. planning at competitive rates. The incentive offers several Beneficiaries under the Free Zone Program enjoy a full- benefits such as exemption from taxes on all income, dividends, interests, rent royalties, compensations, and fledged tax and Customs tariffs exemption. others. Any non-resident may singularly or jointly with others incorporate a company under the IBC Act. QUALIFIED Retired Persons Program The incentives that Belize offers are equipped The Qualified Retired Persons (QRP) program was instituted to facilitate people who wish to live with the resilience to cope with contemporary crossin Belize and can prove a permanent and consistent sectoral needs. In light of this, the investment and income from investment, pension, or other retirement export promotion agency of Belize, BELTRAIDE, benefits. A retired person, on first entering Belize, can serves as a critical government agency that acts as the import his or her personal effects and an approved first stop for investors seeking assistance to explore means of transportation free of all import duties and business opportunities in Belize. BELTRAIDE helps taxes. In addition, the person shall be exempt from potential and existing investors to successfully estabthe payment of all taxes and duties on all income lish their business and to match any relevant incentives or receipts that were accrued from a source outside where applicable. Investors are encouraged to contact of Belize. To extend the benefits further, the retired BELTRAIDE for more information on investing in the person can invest freely in the country, with the excep- niche-oriented country of Belize. tion of becoming gainfully employed.

International Business Companies Act

Belize’s International Business Companies (IBC) Act is designed to meet the needs of sophisticated international investors by permitting asset protection and tax

Lejia Melanie Gideon | Deputy Executive Director BELTRAIDE

47 w ww.B e l i z e I nve st . o rg . bz

BELIZEINNUMBERS METRIC

2010 FIGURE

Land Area

22,966 km2

Population Population Density Population Growth

313,000 (2010) 13.6 person per km2 (2010) 3.0 % (1990-2008)

Labour Force Minimum wage GINI index

140,160 (2011) US $1.65/hour (2012) 53.1 (2011)

GDP GDP per capita Real GDP growth

US $ 1.4 Billion (2011) US $ 4,476 (2011)

2.%

(2011)

METRIC

2010 FIGURE 1.5%

1.6

$

1.5 1.4 1.3

Inflation (Annual average percentage change)

1.2 1.1 1.0 .09 .08 .07 .06 2007

2008

2009

2010

2011

Weighted average lending rate (2011)

13.%

Weighted average deposit rate (2011)

3.7%

Merchandise exports Merchandise imports Import cover of reserves

US $ 603.3 mil (f.o.b.)(2011) US $ 773.9 mil (f.o.b.)(2011) 4.3 months (2011)

Gross Official International Reserves Corporate Income Tax rate

US $ 236.1 million (2011) 0.75% - 24.5%

Average cost of electricity (per kWh)

US $0.10-$0.11/kWh

Average cost of water for businesses

US $4.80 for 0-1,000 gals US $11.19 for 7000-8000 gals

Source: Investment Unit, Ministry of Trade, Investment Promotion, Private Sector Development and Consumer Protection

ABOUT THE BELIZE TRADE AND INVESTMENT DEVELOPMENT SERVICE (BELTRAIDE)

BY NILDA RIVEROL

T

The organization comprises of three main departments: Projects and Administration; Business Development and Business and Investment Facilitation; and Micro, Small, and Medium sized Enterprise (MSMEs) Development, staffed with dynamic, qualified people with keen emphasis on business and investor support who are responsive to a constantly changing environment. Management and staff are committed to the organization’s vision, which states that BELTRAIDE giving advice and tendering recommendations to the exists to “enable a dynamic and competitive business Minister on the formulation of appropriate policies environment for Belize’s socio-economic development.” to guide trade and investment promotion activities; In order to realize this Vision, the organization will pursue a mission to “enhance Belize’s prosperity by identification of products for development and fostering investor confidence, entrepreneurship, business growth and innovation.” promotion; BELTRAIDE’s role in government is to drive a identification of industries to be targeted for proactive approach to policy formation to support private enterprise, while serving as a catalyst for investment; collaboration and optimization of trade and investdesigning and assisting in the implementation ment efforts. The Administration and Projects Unit of export promotion programs, particularly for focuses on harnessing partnerships with other development organizations, taking advantage of internationally Belizean non-traditional export products; available support services through grant projects, and identifying suitable and viable potential export mar- on providing the valuable research and development support to guide enterprise growth in the private sector. kets for Belizean products; This unit has been busy coordinating project impleimplementing policy guidelines on the country’s mentation in the areas of institutional strengthening, Small and Medium Enterprise (SME) policy developtrade and investment promotion programs; ment, export strategy development, market access, and undertaking, encouraging, and supporting publicity policy research support to the public/private sector.

The Business Development Unit has identified campaigns to promote Belizean products in the four key areas of focus in its investment and trade international markets; and promotion activities. These areas include Tourism, performing the functions of a one-stop information Agriculture & Manufacturing, Information Techcenter to investors or potential investors and furnishing nology Enabled Services (ITES), and Energy & to such investors as aforesaid full information about all Mining. The Unit has been staffed with qualified the investment procedures and requirements in Belize. personnel actively soliciting both foreign and local potential investors.

•

• • •

• • •

•

50

w ww.B e l i z e I nve st . o rg . bz

PHOTOS COURTESY BELTRAIDE

he Belize Trade and Investment Development Service (BELTRAIDE) is an established and autonomous institution governed by the provisions of the Belize Trade and Investment Development Service Act Chapter 282, under the Ministry of Trade, Investment Promotion, Private Sector Development, and Consumer Protection. Some of BELTRAIDE’s functions include:

The third unit of BELTRAIDE is the Business and Investment Facilitation and SME Unit. This unit provides inside client services to businesses that require special assistance to establish or grow their enterprises. The main service offered by BELTRAIDE is the processing and granting of Fiscal Incentives, which can result in significant savings to businesses that qualify; however, businesses can seek assistance in a variety of other areas, including facilitation of various permits, or just general advice on doing business in Belize. Perhaps one of the most important initiatives of this unit is the current program for establishment of formal Small Business Development Centers throughout Belize.

BELTRAIDE’s mission is very clear. Through increased capacity in its staff and improvement in its tools, BELTRAIDE will continue to assume the role as the catalyst for private sector/public sector cooperation in national development. BELTRAIDE, along with the Ministry of Trade, Investment Promotion, Private Sector Development, and Consumer Protection, intends to promote the formalization of a permanent forum for this dialogue to continue as we build a positive investment climate.

Finally, as we continue to automate and streamline our internal processes and services for better and more meaningful support to the private sector, and as we expand our reach to the private sector, it is our intention that we can show measured success from our efforts in pursuing our mission of enhancing Belize’s prosperity in the years to come!

Nilda Riverol | Events and Public Relations Coordinator BELTRAIDE w ww.B e l i z e I nve st . o rg . bz

51

Adapting the Small Business Development Center in Belize

BY BELTRAIDE

Given the importance of this sector, and acknowledging the challenges they face, BELTRAIDE has given priority to the growth and development of MSMEs and has adopted a holistic approach that will facilitate the process of addressing and assisting them with the many challenges they face.

w ww.B e l i z e I nve st . o rg . bz

PHOTOS BY DEMIAN SOLANO

F

or over a year, BELTRAIDE did significant work in researching the success of the Small Business Development Center (SBDC) Model in the United States, Mexico, and Central America. The SBDC Model, developed in the United States, comprises of centers that act as a main source of providing managerial and technical support to small businesses. Some of the services offered include incubation for start-ups, one-on-one technical assistance to start-ups and existing businesses, market research, training (group and specialized), and business plan development.

In March 2012, BELTRAIDE, through partnership with the University of Texas at San Antonio (UTSA), the Organization of American States (OAS), Caribbean Export Development Agency (CEDA), and the Development Finance Corporation (DFC) launched the SBDC Model in Belize.

The first step in the successful establishment of centers in Belize was to conduct a series of modular training programs known as Diplomado. Executed over several months, the training was intended to prepare professionals on how to manage their centers and how to provide counseling to their clients. The first modular training was held May 8-10, 2012, at the House of Culture in Belize and was well-attended by tertiary level institutions, financial institutions, credit unions and other business support organizations.

The first center was successfully opened in October 2012. One of the key elements to the success of the center is its long term approach to technical assistance to Micro, Small & Medium Enterprises (MSMEs) through partnerships among private sector, public sector, and academia. The center will aid in the facilitation of their 52 competitiveness, export readiness, and the development of their competences.

53 w ww.B e l i z e I nve st . o rg . bz

DIRECTORY Arguelles and Co. LLC 4th Floor, The Matalon, Coney Drive Belize City, Belize P: +501-223-0088 F: +501-223-6403 E: info@belizelawyer.com W: www.belizelawyer.com A specialist law firm structuring quality legal solutions in the areas of Offshore Law, Real Estate, and Development/Foreign Investment Law.

Atlantic International Corporation Services Ltd.

P.O. Box 169, Agricultural Show Grounds, Belmopan, Belize T: 011-501-822-0818/1378/0197 F: 011-501-822-0271 E: baha@btl.net

Belize Bank 60 Market Square Belize City, Belize P: 227-7132 / 227-7082 F: 223-0156 E: bblbz@belizebank.com W: www.belizebank.com

4792 Coney Drive, 2nd Floor Belize CIty, Belize P: 223-5318 F: 223-5315 E: aicslinfo@atlanticics.com W: www.atlanticics.com

54

Belize Agricultural Health Authority

Bay Trust International Ltd.

BELIZE BANK International

P.O. Box 2130 The Matalon Business Center 5th Floor, Suite 500 Coney Drive Belize City, Belize P: 223-1756 F: 223-1775 E: glen@baytrustbelize.com W: www.btcslbelize.com

The Matalon Business Center Coney Drive, 2nd Floor, PO Box 364 Belize City, Belize, Central America T: (501)227-0697/ 227-1548 F: (501)223-0986 E: services@BelizeBankInternational.com W: www.BelizeBankInternational.com

w ww.B e l i z e I nve st . o rg . bz

DIRECTORY

Belize Tourism Board

Central Bank of Belize

P.O. Box 325 Belize City, Belize Toll Free: 800-624-0686 E: retirement@travelbelize.org W: www.belizeretirement.org

Gabourel Lane Belize City, Belize P: 223-6194 E: info@centralbank.org.bz W: www.centralbank.org.bz

Boris A. Mannsfeld and Associates Placencia, Belize Belize Office: 523-3063 Call from USA: 011-501-523-3063 Boris’ Cell: 610-0294 Frik’s Cell: 610-1223 E: info@RealBelizeEstate.com W: www.realbelizeestate.com

Caribbean Premier Products Ltd. 1380 Forest Drive, Belmopan T: 501-822-2200 F: 501-822-2102 E: sales@coooldelight.com W: www.coooldelight.com Leading manufacturer of Belize’s finest juice-based non-carbonated drinks, like Coool Delight and Frooot Blasts juices.

HERITAGE Bank 35 Barrack Road, P.O. Box 1867 106 Princess Margaret Drive, P.O. Box 1988 Belize City, Belize Central America T: +501. 223. 5698/8784 E: services@banking.bz W: www.heritageibt.com

IDEA LAB STUDIOS LTD. 1755 Coney Drive, P.O. Box 1444 3rd Floor, Belize City Belize C.A. T: 501.223.6386 F: 501.223.5109 E: info@idealabstudios.com W: www.idealabstudios.com Belize’s premier and only full service advertising firm. w ww.B e l i z e I nve st . o rg . bz

55

DIRECTORY

International Communication Services Ltd.

Maranco Ltd.

Mile 13 1/2, Philip Goldson Highway P O Box 603 Belize District T: 501-228-0022 F: 501-228-0023 E: info@icslbelize.com W: www.icslbelize.com

Mile 3 Iguana Creek Cayo District Belize P: 823-0501/2/3 F: 823-0504 E: miguel@maranco.org

International Environments Ltd.

1755 Coney Drive 3rd Floor, Belize City Belize C.A. T: 501.223.1302 F: 501.223.5109 E: info@orchidors.com W: www.orchidors.com The core of Orchid’s service offering is the Orchid Online Reservations System (ORS).

35 New Road, Belize City, Belize P: 223-6996 F: 223-2095 E: info@ie-worldwide.com W: www.ie-worldwide.com International Environments is an allinclusive firm providing a range of integrated services in development, architecture, planning, and construction.

Mahung & Partners LTD.

56

39 Sinsonte Avenue Belmopan City, Belize C: 501.621.0770 F/T: 501.822.1342 E: mahungpartners@gmail.com E: info@mahungpartners.bz A company providing services in the design, Construction & Real Estate Industries. w ww.B e l i z e I nve st . o rg . bz

ORCHID TRAVEL NETWORK

Radisson Fort George Hotel & Marina #2 Marine Parade Belize City, Belize P: 223-3333 W: radisson.com/belizecitybze

DIRECTORY VISIT US ONLINE Robert’s Grove Placencia, Belize P: 523-3565 E: info@robertsgrove.com W: www.robertsgrove.com

SANCTUARY BELIZE T: US Office: +1.949.757.0949 T: Belize Office: 501.533.7576 W: www.sanctuarybelize.com Looking for strategic partnership and investor capital for Marina, Resort, Hotel Casino and Marina Village opportunities.

Visit us online at www.belizeinvest.org.bz

Belize Trade & Investment Development Service 14 Orchid Garden Street City of Belmopan T: 501-822-3737/0175 F: 501-822 0595 E: beltraide@belizeinvest.org.bz W: www.belizeinvest.org.bz facebook.com/beltraide

Scan code with a QR CODE READER on your mobile divice to visit us.

Like us on Facebook!

http://www.facebook.com/Beltraide 57 w ww.B e l i z e I nve st . o rg . bz

B EL I Z E

58 w ww.B e l i z e I nve st . o rg . bz