A Nation of Importation and External Economic Influence

The cost of goods and services has gone up considerably and Belizeans are feeling the pinch in their wallets. But, what are the various factors that are influencing these increases?  To get some answers we turned to Christopher Coye, the Minister of State in the Ministry of Finance, who explains that Belize is “a price taking country”. This means that the country does not determine the prices it pays for imported goods. Coye says that with roughly two billion dollars in imports and half a billion dollars in exports in 2021, increasing prices on the global market significantly influence prices in Belize. In the U.S., the inflation rate stood at eight percent over the last year. Belizean importers, as a result, are paying more for products brought in from the United States. To keep their businesses viable, local importers pass on those prices to local consumers. Minister Coye tells us more.

Christopher Coye

Christopher Coye, Minister of State, Ministry of Finance

“On import you have fuel being a major component of the basic of goods. In terms of import let’s say we imported roughly a hundred and eighty million dollars worth of fuel last year, acquisition cost. I mentioned we imported two billion worth of merchandise. You are already talking ten percent directly of what we imported. You can imagine then the dramatic rise in fuel prices, what impact that will have on the overall basket. In terms of those other products, essential items certainly are impacted in a substantial way. We have all heard about supply chain issues in terms of shipping, in terms of accessing goods, where as in years past because of supply chains issues, some importers are not able to procure the bulks or quantities they use to procure. So they end up suffering on cost implications by losing on economy of scale for one. But also then, in terms of not having any impact or influence on prices, they just are price takers, whatever those prices are they have to accept. We also have shipping cost. There is quite a bit of complaint raise of what is shipping cost. I think it is multiple of what it used to be. So, all those things have an inflationary impact on the basket of goods that Belizeans typically purchases.”