IDB works fast to help Belize
At the opening of yesterday’s newscast we spotlighted that most basic of political exercises: angry citizens descending on their elected representative to get themselves a bigger slice of government’s pie. Tonight we look at a process that is not all that dissimilar. The only difference is that the pie is much bigger and those at the dinner table wear ties or guyaberas.
Edgard Guerra, IDB Executive Director
“We want to express our solidarity to the people of Belize who is in the last few weeks faced the devastation of Hurricane Keith.”
Stewart Krohn, Reporting
As he uttered the first words of his address, IDB Executive Director for Central America Edgard Guerra, made it clear that his bank would be playing the leading role in Belize’s long-term economic recovery from Hurricane Keith. For only the second time in its history the Interamerican Development Bank mobilised its emergency reconstruction facility. Under that procedure, Belize has requested and been granted–in record time–an immediate twenty million U.S. dollar line of credit.
Hugo Souza, IDB Representative in Belize
“It will be a transparent procedure, but very flexible. So it will not take us one hundred and twenty days to hire a contractor or to hire a consultant. It will be very fast.”
Hugo Souza, the IDB representative in Belize, went on to explain exactly how the arrangement will work.
Hugo Souza
“The new procedure allows us to go ahead with the preliminary assessment of the damage. We don’t have to wait thirty or sixty days to get an exact figure of how much is the damage. This preliminary assessment was done by the Government of Belize and with our help. We worked together and we came up with a figure of two hundred and fifty million U.S. dollars. With that figure we went back to Washington. We already approved through a loan committee this twenty million dollars. We are going to be negotiating this this coming week and we’re going to approve the loan. We are going to have a technical assessment by CEPAL or ECLA in English and they are going to come out with a better document and this better document is going to be shown to the international organisations, the donor countries, in defence of a Belize meeting that will take place in December.”
IDB Governor for Belize and Minister of Budget Planning Ralph Fonseca, was the country’s point man in mobilizing the IDB to fast track their assistance. Of the first twenty million he explained that five would go to cover retroactive costs of cleaning up, ten in direct contracting to local sources and another five million in larger contracts which would be put out to tender. The work would cover construction of roads, bridges, schools and housing. As for charges that existing aid was being unfairly distributed, Fonseca reminded certain politicians that when the going gets tough, the tough had better get going.
Ralph Fonseca, Minister of Budget Planning
“In a time of need like this, of course the people that are willing to do the work, to get out there, and to speak intelligently, to give the necessary rational for the work that has to be done, will get the services. If you are sitting there waiting for it, everybody is busy, very, very busy and I think that may be the kind of problem that may occur in one or two areas.”
As for overall impact on the economy, Fonseca expressed the hope that projected high rates of growth could still be achieved. Regarding the disaster’s effect on what the Leader of the Opposition and Central Bank Report called a dangerous foreign reserve situation, the minister did not mince words.
Ralph Fonseca
“That was a paper written by a technocrat in the Central Bank. There are many, many papers, there are many opinions and our Prime Minister I think has explained it very well. When you are on an accelerated growth path like we are in Belize, especially when we went from one point four percent to over six percent in eighteen months, you have to be very careful with your foreign exchange situation. One of the reasons why we particularly designed into the RMS a balancing of monetary policy is to continue and maybe even closer continue monitoring that situation in order that we don’t fool ourselves. That is we are going to get quite a few inflows into Belize, which come in in hard currency, this arrangement that we are talking about today for instance comes in, it’s twenty million U.S. dollars. That twenty million U.S. dollars will not add twenty million U.S. dollars to our reserve position after the end of the year. Maybe, about thirty percent of that will stick, and that’s the way economic growth works.”
“If you are going to build a road, probably fifty percent of it will leave the country right away, but even the portion you pay to the guys that are working on the road, or that are driving the trucks or whatever, they are going to buy video machines, they’re going to buy T.V. etcetera, and we don’t want to stop that. That will take a portion of it, so at the end of the day, as long as you’re growing, as long as you are providing a better way of life for Belizeans and as long as you have a fixed exchange rate like you do, in fact you are forced to defend the dollars and you are forced to make sure that in fact you have the necessary reserves to deal with it. Then you have to balance it, then you have to manage it like everything else. And you do need technicians who are ultra conservative saying to you all the time be careful, be careful, be careful. Nothing’s wrong with that. What is wrong is to take that due prudence and diligence and start beating on the economy with it because that has nothing to do with providing a better way of life for Belizeans, that’s endangering the dollar and that’s not decent.”
Stewart Krohn for News Five.
Official government estimates of damage from Hurricane Keith have now climbed to five hundred and twenty-three point one million Belize dollars. You can hear more from Fonseca and the IDB’s Edgard Guerra later tonight on One on One with Dickie Bradley.
