Less than four months after the People’s United Party (PUP) came to power in 1998, they introduced the Small Farmers and Business Bank, headquartered in Belmopan. The PUP said the Small Farmers and Business Bank would allow farmers and small business folk greater access to credit at low interest rates. The United Democratic Party (UDP) described the Small Farmers and Business Bank as a vehicle to give handouts to favorites of the PUP.

In 2013, when the UDP opened the National Bank of Belize in Belmopan, Prime Minister Barrow said it would bring down the cost of accessing money, and the chairman of the bank, Ambassador Joy Grant, explained that the bank’s first mission would be to provide low-cost loans for teachers, public officers and others who were interested in building a home, and later on the bank would expand its financial products and services.

In 2014, the present prime minister, Hon. John Briceño, wasn’t dismissive of the bank, and the evidence of that is that when Prime Minister Barrow went to the House of Representatives to ask for a further $10 million so that the bank could give out more low-interest loans, he, Hon. Briceño, suggested it would be a good idea for the bank to facilitate loans for students at lower interest rates than they were getting from the DFC.

However, in 2020 Hon. Briceño described the National Bank of Belize as a “perennial loss-making enterprise”, and while we couldn’t find any statement on the party’s plans for the bank in their manifesto, “perennial loss-making enterprise” does suggest that the bank is not a vehicle this PUP government plans to keep.

The bank is not in the best financial shape. The Central Bank’s Quarterly (April-June 2020) Financial Report on Belize’ s domestic banks showed that the National Bank was operating in the red with a troubling 4.96% of loans not performing, this despite the government maintaining the salaries of its employees during the strain of the pandemic. Any loss of earnings in this sector would further negatively impact the performance of the National Bank.

The new government just might allow the National Bank to fold, but if that is their intention, before they follow through it would be wise for them to take a closer look at the countries around us. The evidence is that countries in our region that are seriously invested in state-owned banks are doing better.

Per capita earnings aren’t the only measure to determine the standard of living in a country, but it is a strong indicator, and according to World Bank data for 2019, Panama was tops in our region with per capita earnings of US$15,731, followed by Costa Rica, with US$12,238.4; Belize, with US$4,815.2; Guatemala, with US$4,620; El Salvador, with US$4,187.3; Honduras, with US$2,574.9, and Nicaragua, with US$1,912.9.

Investopedia, at the website investopedia.com, says there are three state-owned banks in Costa Rica, and one of them, Banco Nacional, formed in 1914, is the second largest bank in Central America in terms of assets, while another, Banco de Costa Rica (BCR), is considered one of the strongest banks in the region. It is stated on one Wikipedia page that there are two state-owned banks in Panama that can only do business internally: Banco Nacional de Panamá (BNP) and Caja de Ahorros de Panamá. Information from the website statista.com, says that the state-owned Banco Nacional de Panama is the second biggest bank in that country.

Privacy Shield Framework at the website privacyshield.gov, says that of 14 commercial banks in El Salvador, two are state-owned, and together their market share is 4%. The website, countrystudies.us, says that in 1985 all commercial banks in Honduras were privately owned, except for the Armed Forces Social Security Institute, and there were two government-owned development banks. In Guatemala, the government controls 16% of the Rural Development Bank (BanRural), the second largest bank in that country (www.state.gov). In Nicaragua, “there are no state-owned commercial banks” (nationsencyclopedia.com).

The UDP’s commitment to the National Bank could be questioned, because they did not pump in cash to increase its viability when they had the opportunity. It’s an absolute contradiction that the government that created the National Bank to compete with the private commercial banks is the same government that privatized the national lottery.

The numbers show that state-owned banks help countries increase their wealth, and the proof that people in countries with state-owned banks get a greater share of the product is evidenced by those countries’ stability. Costa Rica and Panama, the countries with state-owned banks, have been stable, while in the last several decades there has been major political upheaval in Guatemala, Honduras, El Salvador, and Nicaragua. The present government has a manifesto that says all of us are to win. They have a greater chance to fulfill that manifesto promise if they follow the lead of Costa Rica and Panama.

Belize must have a more practical response to climate issues

There are people in our world, quite a few in Belize, who don’t believe that climate change is real. Some climate change deniers pass off the extreme weather as the end times, while others say the earth is going through a phase that human beings can do nothing about.

The hurricanes, especially, give us cause to worry. This year we have seen two small hurricanes hit Mexico and two mammoth hurricanes hit Nicaragua. We can’t recall that happening before. The outer bands of the hurricanes that hit Nicaragua have caused flooding in Belize that we haven’t seen in many years.

It is hard to fathom how otherwise intelligent people refuse to accept that human beings are pumping more and more greenhouse gases into the atmosphere and removing more and more of the earth’s canopy, and these are bad things for the environment, but for now never mind that: what no one can deny is that in recent years we have been experiencing severe weather conditions in our region – droughts, floods, and hurricanes – and we need to respond appropriately.

We have to improve drainage in both high areas and low areas. On the coast and the flood plains we must return to building our houses on stilts. Too much of our soil is being washed away, carried by the rivers to the sea, where the soil particles settle on the coral reefs and kill them. We must insist that the buffer zone alongside rivers be respected.