At the Wednesday, November 23, 2011, business forum titled, Turning The Corner, Prime Minister Dean Barrow announced that the Government of Belize has requested the help of the International Monetary Fund (IMF) to conduct a diagnostic—a short-term technical mission—for Belize.
Following its annual 2011 mission to Belize, IMF directors, in a report released in October 2011, urged a reform of Belize’s tax system.
“Welcoming the authorities’ intention to strengthen tax administration, Directors stressed the importance of improving overall tax collections, including a reduction in tax concessions,” said the public information notice at the conclusion of their visit.
When asked at a subsequent press conference to comment on the IMF report, Barrow said, “Basically, I am here to tell you that what the IMF says doesn’t much matter to me. We have a job to do and their insistence on fiscal consolidation at a time of recession, when Government needs to spend more to drive the economy, because the private sector is in the doldrums, I don’t really want to hear about fiscal consolidation….”
On Wednesday, however, Barrow announced, “We have recently requested a diagnostic of our taxation system with a view to its simplification and its rationalization, and I know this is something that the private sector will greatly welcome so we, like you, will anxiously await the start and outcome of that exercise.”
Barrow later added: “…we have indicated to the Fund that we want this to happen with a sense of urgency. I’m not entirely sure where the process is…”
Adding more on the IMF process, Financial Secretary Joe Waight said that the formal application to the IMF has already been made and the Government of Belize had a discussion with the IMF in October.
He said that Belize should expect an IMF field mission next year, along with another assessment to be carried out by a team funded by the Canadians and including representation from the World Bank.
The team would look at Belize’s financial system and provide information that would feed into the IMF process, which is expected to take place in the first quarter or early second quarter next year, 2012.
According to the IMF, such technical assistance (TA) missions by the Fiscal Affairs Department (FAD) of the IMF are led by the IMF headquarters and last one to two weeks.
“The expert who participates in a diagnostic mission,” said the IMF, “will be expected to: prepare for the mission by reading relevant documents prior to the mission, and in some instances through a pre-briefing at IMF headquarters for 2-3 days… participate fully in discussions with national authorities in his/her area of expertise; write sections of the draft TA report that is prepared and submitted to the authorities while the TA mission is in the field; and contribute to the team effort as directed by the mission head.”