The Belize Economy

Outside of Belize City, however, the country is starting to boom. Tourism is up 500% over the last few years, and agriculture and lumber workers are finding the soils of western Belize to be among the most fertile in the world. Thousands of acres of orange trees are being grown outside the western city of San Ignacio. With poor yields this year in Florida and Brazil, Belize has been one of the major beneficiaries of extremely high orange prices. Much of the same is true with the grapefruit crop, which was nearly eliminated in Florida from the hurricanes a year and a half ago.

Perhaps the commodity that most defines Belize though is mahagony. A rare hardwood that fetches premium prices on the world market, mahagony seems to have been a staple of the Belizean economy well before its independance from Britain. Much of the southern part of the country is dedicated to rows and rows of these trees. With the exception of the now booming tourist industry in San Pedro, orange, grapefruit, bamboo, and mahogany comprises the vast majority of foreign investment into the country.

Foreign entrepreneurs have been driving into the country in hordes. With an extremely relaxed immigration policy (it only takes 6 months to become a citizen), people from all over Central America and Asia have been opening up shops along the Cayes to take advantage of the influx of tourists into the area. Many of them have become quite wealthy, as there has been little competition from the local Belize people. Other investors, who want to take advantage of the boom in commodities, have been running towards the western and southern parts of Belize to buy land at very low prices. Only a short time ago, in an effort to make more productive use of the land, the government was essentially giving it away to the local people for $100/acre. With little knowledge of agriculture, many locals have done almost nothing with this land, allowing it to sit around with no productive output. Many locals, realizing they have no other option, have now been selling this land to foreign workers at fire-sale prices.

While the difference between the locals and the foreigners is extremely obviously throughout the country, the risk of a backlash from this is very low due to the extremely sparse population that exists there. Belize City itself only has a total of 60,000 people, and the foreigners have started to exercise not only economic control, but political power as well. In fact, the leader of the country is himself an Iranian born pro-western businessman. With such an influx of hard working, knowledgeable people into a country that already contains some of the most fertile land in the world, it is a very real possibility that Belize may be one of the great success stories over the next decade.

By The Commodity Investor