Forestry was the only economic activity of any consequence in Belize until well into the 20th century when the supply of accessible timber began to dwindle. Cane sugar then became the principal export and recently has been augmented by expanded production of citrus, bananas, seafood, and apparel. The country has about 809,000 hectares of arable land, only a small fraction of which is under cultivation. To curb land speculation, the government enacted legislation in 1973 that requires non-Belizeans to complete a development plan on land they purchase before obtaining title to plots of more than 10 acres of rural land or more than one-half acre of urban land.

Domestic industry is limited, constrained by relatively high-cost labor and energy and a small domestic market. The embassy knows of some 185 U.S. companies which have operations in Belize, including, Archer Daniels Midland, Texaco, and Esso. Tourism attracts the most foreign direct investment, although significant U.S. investment also is found in the energy and agriculture sectors.

A combination of natural factors--climate, the longest barrier reef in the Western Hemisphere, numerous islands, excellent fishing, safe waters for boating, jungle wildlife, and Mayan ruins--support the thriving tourist industry. Development costs are high, but the Government of Belize has designated tourism as one of its major development priorities . In 2002, tourist arrivals totaled 199,493 (more than 50% from the United States).

Belize's investment policy is codified in the Belize Investment Guide, which sets out the development priorities for the country. A country commercial guide for Belize is available from the U.S. Embassy's Economic/Commercial section and on the Web at

Infrastructure
A major constraint on the economic development of Belize continues to be the scarcity of infrastructure investments. Although electricity, telephone, and water utilities are all relatively good, Belize has the most expensive electricity in the region, despite recent cuts in commercial and industrial rates. Large tracts of land, which would be suitable for development, are inaccessible due to lack of roads. Some roads, including sections of major highways, are subject to damage or closure during the rainy season. Ports in Belize City, Dangriga, and Big Creek handle regularly scheduled shipping from the United States and the United Kingdom, although draft is limited to a maximum of 10 feet in Belize City and 15 feet in southern ports. American Airlines, Continental Airlines, U.S. Air, and TACA provide international air service to gateways in Dallas, Houston, Miami, Charlotte, and San Salvador.

Several capital projects are either currently underway or are programmed to start in 2003. The largest of these is a $15 million rural electricification program to be jointly implemented by the government and the Belize Electricity Limited (BEL) company. In addition, the government will continue to implement an Inter-American Development Emergency Reconstruction Fund of $20 million aimed at restoring essential services such as health and education facilities and transportation networks to communities which were severely damaged by Hurricane Keith in late September-early October 2000. The government also will invest close to $4.2 million in projects targeted at poverty alleviation across Belize.

The Ministry of Agriculture and Fisheries, through the Belize Agricultural Health Authority, continues to implement the IDB-funded Modernization of Agricultural Health Project. This $2.5 million project seeks to improve the competitiveness of Belize's agricultural products and thus enhance the ability of Belizean farmers and processors to maintain and expand the sale of their high-quality products to foreign markets.

The government will continue investing $9.5 million in its health sector reform program, as well as $9 million under the IDB-funded Land Management Project over the next 2 years. The Belizean Government will spend close to $1.4 million in improving access to archaeological sites in Belize, especially "Caracol."

Trade
Belize's economic performance is highly susceptible to external market changes. Although growth as high as 8.2% was achieved in 2000, this achievement is vulnerable to world commodity price fluctuations and continuation of preferential trading agreements, especially with the United States (cane sugar) and the United Kingdom (bananas).

Belize continues to rely heavily on foreign trade, with the United States as its number one trading partner. Imports in 2002 totaled $526.8 million, while total exports were only $294.5 million. In 2002, the United States provided 60% of all Belizean imports and accounted for 54.5% of Belize's total exports. Other major trading partners include the United Kingdom, European Union, Canada, Mexico, and Caribbean Common Market (CARICOM) member states.

Belize aims to stimulate the growth of commercial agriculture through CARICOM. However, Belizean trade with the rest of the Caribbean is small compared to that with the United States and Europe. The country is a beneficiary of the Caribbean Basin Initiative (CBI) program which forms part of the U.S.-Caribbean Basin Trade Partnership Act (signed into law by President Clinton on May 8, 2000), a comprehensive U.S. Government program designed to stimulate investment in Caribbean nations by providing duty-free access to the U.S. market for most Caribbean products. Significant U.S. private investments in citrus and shrimp farms have been made in Belize under CBI. U.S. trade preferences allowing for duty-free re-import of finished apparel cut from U.S. textiles have significantly expanded the apparel industry. EU and U.K. preferences also have been vital for the expansion and prosperity of the sugar and banana industries.