Belize is an independent country lying on Central America’s east coast, and it borders Mexico to the north and Guatemala to the west and south. The country has a land area of 8,867 square miles and by 2017 its population was standing at 387,879 making it the least densely populous nation in Central America. As of 2015, the country had a population growth about 1.87% annually which was Central America’s highest. In 2018, the country had a nominal GDP of $1.92 billion and GDP based on purchasing power parity of $3.343 billion. Similarly, nominal GDP per capita in the same year was $4,906, and GDP per capita based on purchasing power parity was $8,590. Agriculture and tourism are the key pillars of the country's economy. Lately, construction has played a more significant role in the economy, and there has been a rise in the production of industrial minerals as well.
Agriculture in Belize is the most critical industry in the overall economy and employs well over one-third of the country's labor force, and in 1999 the industry accounted for approximately 22% of the country's GDP and approximately 60% of all export revenues.
Sugar cane is the country’s most important agricultural crop which accounts for approximately 50% of all export earnings and occupies more than half of the arable land in the country. Trade agreements between Belize and the European Union and the United States, such as the preferential quarters and tax rates on the sugar, have maintained high sugar revenues to the country. In 1999, Belize exported 16,772 tons of sugar to the US and about 39,400 tons of sugar the European Union.
Fruits and Vegetables
Bananas, grapefruits, and oranges are some of the most important agricultural export items as well. Fruit cultivation is carried out mainly along the Eastern Creek Valley. Fruits export recorded the highest levels in 1995 and 1996, but in the subsequent years, there was a slump in the earnings as international market prices dropped significantly. The US granted Belize duty-free entry for bananas and citrus concentrates following the Caribbean Basin Initiative (CBI). Banana production in Belize is a major sector which accounts for approximately 16% of all exports as of 1999. Production of bananas has been under the control of the state-run banana control board which was taken over by the Growers Association. By the mid-1990s, the new Association which had better management was able to raise the production of the commodity to record levels. Other export items from Belize include organic cocoa, papayas, chili peppers, tropical fruit, and assorted vegetables.
Livestock and Fish
Belize has made significant strides in rearing livestock and has made the country self-sufficient in poultry products and fresh meat. By 1999, the country produced about 3.3 million pounds of beef and about 1.9 million pounds of pork and most of these outputs were exported mainly to Guatemala and Honduras. Fishing plays an important role in the country by providing food for domestic use as well as an important source of income. Belize exports more than 5,200 tons of marine products every year which are mostly comprised of shrimp and lobster.
Tourism has experienced dramatic growth in Belize, particularly in the recent years, and currently, it is the second most important sector in the country, and the government has indicated that they will be using tourism to fight poverty across the country. Significant expansion of tourism has contributed to positive growth to other industries such as finance, commerce, construction, and agriculture. The growth in tourism has been so huge, and for the first time ever Belize history the country was able to welcome about 1 million tourists in one calendar year in 2012, and the growth has always been positive ever since.
Belize became an independent nation in 1981, and at the time the country was not considered the best tourist destination because it lacked sufficient infrastructure to support a vibrant tourism industry. In the recent past that has changed when tourism emerged as Belize’s second most important industry. Today Belize has numerous tourist destinations around the country such as the Belize Barrier Reef, which is the world's second largest barrier reef, and the Great Blue Hole, the world's largest underwater sinkhole. The safe waters mean tourist can engage in swimming, windsurfing, boating, cave rafting, scuba diving, paddle boarding, and snorkeling. The country also has numerous rivers which are suitable for kayaking and rafting. Besides, Belize has numerous jungles and wildlife reserves where flora and fauna flourish. Tourists also can engage in bird watching, hiking, helicopter tour and could also visit the numerous Maya ruins. Belize is home the second largest cave systems in Central America where tourist can visit.
The Ministry of Tourism is in charge of managing tourism in the country, and it has the tourism board which acts as the linkage between the public and the private sector in the country. In 2007, tourism contributed more than 25% of jobs in the country and accounted for more than 18% of the nation’s GDP.
Oil exploration in the country began in 1938 when Shell Company was granted the license to prospect for oil. The first well, Yalbac, was drilled in 1956. The result was the non-commercial value of oil, but it indicated that there was a possibility of striking oil in the country and this led to interest from other major companies such as Philips, Esso, Texaco, Chevron, and Anschutz. By 1980, there were more than 40 exploration wells which had been drilled, and all were unsuccessful with no viable commercial discovery. Most of the wells drilled showed some oil presence, and eventually, all the companies lost interest and left, but the data that had been obtained remained with the government of Belize and later attracted the attention of other smaller companies such as Petro Belize, Spartan, and Marathon. By the 1990s, more than 50 wells had been drilled both onshore and offshore, but there was no significant oil discovery, and it was attributed largely to poor data quality and perhaps the limited knowledge of geology in the country.
In 2005, the first commercial discovery of oil was made by the Belize Natural Energy Ltd, and a second discovery in the same year located on the fringes of the Corozal Basin which is part of the Peten Basin that extends into the neighboring countries of Mexico and Guatemala. Currently, exploration efforts of oil are carried out mainly onshore, and it is believed that there are significant potential oil deposits in the southern part of the country. As of 2017, Belize was producing an average of 2,000 barrels of oil per day.
Challenges Facing Belize
The economy of Belize is vulnerable to foreign market changes. Although there has been significant growth in the economy of Belize in the recent past, it is still vulnerable to changes in commodity prices in international markets. Preferential treatment by the US and the United Kingdom on sugar and bananas has given the much-needed support to Belize. The country has continued to rely heavily on trade with other countries particularly the US which is a major trading partner. In 2000, the US accounted for about 48.5% of the country's exports. Other major trading partners with Belize include Canada and the CARICOM member states. The country negotiated a preferential trade agreement in 2010 with Guatemala.