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Home Highlights Belize’s economy contracts for 5th consecutive quarter, this time by 23.3%

Belize’s economy contracts for 5th consecutive quarter, this time by 23.3%

BELIZE CITY, Thurs. August 27, 2020.– On August 26, the Statistical Institute of Belize (SIB) released its report on economic activities for the month of July 2020, the period April to June 2020, and the seven-month period, from January to July 2020. As expected, the news is not good; in fact, it is bad, about as bad as we have ever seen it. Belize’s gross domestic product (GDP) was down by $169.9 million (23.3%) in the second quarter of 2020, when compared with our output in the second quarter of 2019. Our domestic exports for July 2020 were down 37.3% or $17.2 million when compared with exports for July 2019, and our total merchandize exports from January to July 2020 were down 13.1%.

The SIB report said, “Economic activity declined significantly across all three sectors, as the COVID-19 pandemic, coupled with extended dry weather conditions, continued to severely impact the Belizean economy. The tertiary sector was particularly hard hit, with decreases in ‘Wholesale and Retail Trade’ and ‘Hotels and Restaurants’ together accounting for a half of the overall reduction in total output for the quarter. Furthermore, ‘Taxes on Products’ were down by more than one-third, from $102 million in the second quarter of 2019 to $64.7 million in the second quarter of 2020.”

Our tourism industry has gone completely flat, with nil earnings in the second quarter of 2020. From April to June (2019), 240,000 cruise tourists visited Belize, and 126,000 overnight tourists arrived in Belize.

Our earnings from sugar, bananas, and citrus all declined in July 2020, when compared to our exports of those products in July 2019, and over the seven-month period, from January to July 2020, there was an overall increase in revenue from the export of bananas, while revenue from the other two major exports, sugar and citrus, declined. Marine exports, with improved sales of lobster and shrimp, showed a modest increase over the first seven months of the year, and also in July.

Very disappointingly, Belize continues to import a lot of fats and oils, which can easily be produced here. For the seven-month period between January and July 2020, the value of imports of oils and fats actually increased by $2.6 million, from $11.5 million in 2019 to $14.2 million in 2020.

The report says the cost of living ticked up by 0.1% in July 2020, when compared to the same month last year. The SIB says “this was the result of higher home rental costs and prices for a variety of food items being balanced out by substantially lower prices for fuel and Liquefied Petroleum Gas (LPG).”

Report of the Statistical Institute of Belize on imports, exports, and the productive sectors

Total goods and services produced down 23.3% in second quarter

Estimates for April-June 2020 indicate that Belize’s economy contracted for the fifth consecutive quarter, the overall level of economic activity declining “sharply by 23.3 percent when compared to the second quarter of 2019…” with “the total value of goods and services produced within Belize during the period valued at $558.6 million, down by $169.9 million from $728.5 million produced during the same three months of 2019.”

PRIMARY ACTIVITIES: The primary sector contracted by 12.2 percent during the second quarter of the year, from $80.6 million to $70.8 million, when compared to the same period in 2019. Sugarcane production declined considerably, by 14%; and livestock production fell by 36.9 percent – specifically, cattle exports declined by 68.9%, poultry production declined by 29.4%; and pig production declined by 16.2 percent.

Despite a strong performance in regard to lobster tail exports, the fishing industry recorded an overall decrease of 49.1%, as conch exports plunged by 84.8% and shrimp exports fell by 63.3%. Banana production went up by 12.1%, and “citrus fruit deliveries rose slightly by 1.3%.”

SECONDARY ACTIVITIES: Secondary activities recorded a 19.5 percent decline over the three-month period, from $106.6 million in the second quarter of last year to $85.8 million in the same period this year. Beer production dropped 46.6%, and soft drink production was down 7.7%. There was a 24.9% drop in sugar production, and a 6.8% increase in citrus concentrate produced during the quarter. Crude petroleum extraction fell by 30.9% in comparison to the second quarter of 2019, as 19.4 thousand fewer barrels were extracted from reservoirs.

Local production of flour was down by 14%, electricity generation dropped 20.6%, water production decreased by 1.1%, and the ‘Construction’ subsector recorded a 14.1 percent decrease in production.

TERTIARY ACTIVITIES: The services sector, which comprises almost two-thirds of Belize’s economy, was the most severely impacted by COVID-19, recording a significant 23.2 percent decline in output over the three-month period. Production within this sector was down by $101.9 million, from $439.2 million in the second quarter of 2019 to $337.4 million in the second quarter of 2020.

The ‘Hotels and Restaurants’ subsector recorded a dramatic decrease of 99.4%, the ‘Wholesale and Retail Trade’ subsector contracted by 37.1 percent, the ‘Transport, Storage and Communication’ subsector declined by 28.8%. Only the ‘Government Services’ sector was up, by 1.8%.

(Condensed from SIB report published on August 26, 2020)

Imports for July 2020 down by $72.4 million (37.8%)

For the month of July 2020, Belize imported goods valuing $119 million. This represented a 37.8 percent, or $72.4 million, decrease from the same month in 2019, when imports totaled $191.4 million. For the third consecutive month, imports declined by more than one-third, signaling the far-reaching impact of the COVID-19 pandemic, as local demand for merchandise goods remained low.

DECREASING CATEGORIES: Imports into the ‘Commercial Free Zones’ plummeted from $38.9 million in July 2019 to $13.9 million in July 2020, on account of reduced purchases of several items, including cigarettes, sweaters and floor fans; the ‘Mineral Fuels and Lubricants’ category decreased from $33.8 million to $12.9 million, as the country spent less on diesel, regular and bunker C fuels; and imports of ‘Machinery and Transport Equipment’ fell from $33.4 million in July 2019 to $21.5 million in July 2020, due to fewer purchases of air conditioners, crushing machines and printer parts, among other items. Imports in the ‘Manufactured Goods’ category dropped from $24.2 million in July 2019 to $17.9 million in July 2020; imports in the ‘Food and Live Animals’ category fell from $23.3 million to $18.7 million, and imports in the ‘Other Manufactures’ declined by 20% or $2.6 million, from $12.8 million in July 2019 to $10.2 million in July 2020, due to reduced purchases of meters, plastic bottles and gaming equipment.

(Condensed from SIB report published on August 26, 2020)

Domestic exports down 37.3% in July 2020

Total domestic exports for July 2020 amounted to just under $29 million, down by a substantial 37.3 percent or $17.2 million when compared to exports for July 2019, which were valued at $46.2 million.

DECREASING CATEGORIES: Revenues from sugar fell steeply, by $12.7 million or 56.6%, from $22.4 million in July 2019 to $9.7 million in July 2020; earnings from bananas declined by $1.5 million or more than 21%, from $6.9 million in July 2019 to $5.4 million in July 2020; revenues from citrus products went down by $1.2 million, from $4.8 million to $3.6 million. Also, there were no exports of red kidney beans in July of this year, while last year we earned $1.8 million from this commodity.

INCREASING CATEGORIES: Improved sales of lobster products and shrimp drove earnings from this group of commodities up by $0.8 million, from $4.3 million in July 2019 to $5.1 million in July 2020.

(Condensed from SIB report published on August 26, 2020)

Merchandize imports for first seven months of 2020 down 19.3%

Merchandise imports for the first seven months of the year, January to July 2020, amounted to $912.8 million, representing a 19.3% or almost $219 million decrease from the same period last year, when imports totaled $1.1 billion.

DECREASING CATEGORIES: A notable fall-off in the quantities of diesel, regular, kerosene and bunker C fuels that were imported, coupled with lower world market prices for fuel, were the main reasons for a $74.7 million or 41% decrease in imports in the ‘Mineral Fuels and Lubricants’ category. Goods meant for the ‘Commercial Free Zones’ decreased by $50.9 million or almost 28%; imports in the ‘Machinery and Transport Equipment’ category went down by $38.2 million or 17%, from $219.5 million to $181.3 million; imports in the ‘Manufactured Goods’ category “shrank by $21.2 million or almost 14 percent during the seven-month period, falling from $152.7 million in 2019 to $131.5 million in 2020.”

The ‘Other Manufactures’ category was down by $15.9 million; the ‘Crude Materials’ category, with less imports of treated pine lumber, used clothing and wooden poles, was down from $19.3 million in 2019 to $12.1 million in 2020; the ‘Chemical Products’ category declined by $6.5 million, from $104.5 million to almost $98 million, due to decreased imports of fertilizers, plastic pipes and medicines, most of which consisted of antibiotics; imports in the ‘Food and Live Animals’ category decreased during the period, from $134.6 million to $130.8 million; and ‘Designated Processing Areas’ went down by $2.9 million, attributable to lower purchases of metal furniture, excavators and fish feed.

INCREASING CATEGORIES: The value of imports in the ‘Oils and Fats’ category rose by $2.6 million, from $11.5 million in 2019 to $14.2 million in 2020, as larger imports of various types of cooking oils were recorded.

(Condensed from SIB report published on August 26, 2020)

Merchandize exports down 13.1% for first seven months of 2020

Merchandise exports for the period January to July 2020 totaled $220.4 million, down 13.1 percent or $33.3 million from the $253.7 million recorded for the same period last year.

DECREASING CATEGORIES: There were no exports of crude petroleum for the first seven months of 2020, in contrast to the same period in 2019, when there were two shipments, and earnings of $12.9 million were recorded. The low world market prices for crude petroleum would have resulted in exports of this product not being profitable. Sugar revenues dropped by 13% or just under $11 million, from $86.6 million in 2019 to $75.6 million in 2020, earnings from citrus products declined by 23% or $8.9 million, from $38.6 million to $29.7 million, and revenues from animal feed went down by $2.2 million, from $9.8 million in 2019 to $7.6 million in 2020.

INCREASING CATEGORIES: Revenues from bananas rose by $1.7 million, from $47.3 million in 2019 to just over $49 million in 2020; revenues from marine products went up from $19.9 million to $20.2 million, as improved sales of lobster products partially offset decreased exports of conch and shrimp; and earnings from red kidney beans increased by nearly $3 million, from $7.3 million in 2019 to $10.2 million in 2020.

(Condensed from SIB report published on August 26, 2020)

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