WASHINGTON, CMC – The Executive Board of the International Monetary Fund (IMF) welcomes the “strong recovery” in Belize following the COVID-19 pandemic, as well as the improved social outcomes and financial stability.
In a statement following its Article IV Consultation for Belize, the executive noted that, after expanding by 30.6 percent between 2021 and 2023, real gross domestic product (GDP) grew by 8.1 percent last year, driven by positive developments in tourism, trade, and transport.
At the same time, inflation continues to moderate, slowing to 1% in May 2025 from 4% in May 2024, owing to decelerations across most categories.
The IMF stated that this strong nominal growth, combined with expenditure control and a sharp recovery in government revenues, improved the primary balance to 1.7 percent of GDP in the financial year 2024.
In turn, public debt fell sharply to 61.1 percent of GDP in 2024, after peaking at 103.3 percent of GDP in 2020, also supported by a debt-for-nature protection swap and a negotiated discount on the debt with Petrocaribe.
Real GDP growth is expected to decelerate to 1.5 percent in 2025, primarily due to a slowdown in tourism and a weak performance of the agricultural sector. It is projected to gradually converge to its potential of about 2 percent over the medium term, absent expansion of hotel and flight capacity.
The IM executive directors highlighted that growth is expected to decelerate sharply in 2025, before converging to its potential over the medium term.
Noting the downside risks stemming from high exposure to external risks and increased global uncertainty, they stressed the need to reduce public debt and accelerate reforms to unlock potential growth and build resilience to natural disasters.
The IMF officials stated that, as a small developing country with capacity constraints, they agreed on the importance of continued, tailored policy advice and technical assistance to support implementation in Belize.
They have also welcomed Belize’s commitment to building buffers against future shocks, particularly by lowering public debt to below 50 percent of GDP. They recommended enhanced revenue mobilization and reprioritization of current expenditure, including through pension reform, to make space for priority spending on targeted social programs, crime prevention, and infrastructure.
The IMF stated that establishing a medium-term fiscal framework with clear targets and measures would enhance credibility and pave the way for an effective Fiscal Responsibility Law.
The IMF directors agreed that continued reserves accumulation would help strengthen the credibility of the currency peg. They said further fiscal consolidation, structural reforms to enhance competitiveness, and continued efforts to reduce the central bank’s holdings of government securities are essential measures.
They also welcomed the decline in systemic risks and encouraged continued commitment and vigilance to maintain financial stability. They emphasized the need to expedite the implementation of the Deposit Insurance Act to strengthen the economic safety net.
The directors also agreed on the importance of improving private sector access to financing to boost investment, highlighting the considerable progress made in strengthening the anti-money laundering and countering the financing of terrorism (AML/CFT) framework, and called for continued efforts to address the remaining gaps.
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