Belize: Country and Foreign Investment
Foreign Investment Regime
The Government of Belize lists the following criteria according to which it judges foreign investment:
- creates employment opportunities;
- makes maximum use of indigenous raw materials;
- earns foreign exchange;
- results in increased production;
- introduces state-of-the-art technology;
- enhances local management skills;
- promotes greater efficiency through competition;
- diversifies the economic base;
- facilitates access to foreign markets;
- is environmentally friendly.
Longer term incentives are offered for the location of industries in the less-developed rural areas of the country and for export-oriented projects or projects utilizing technology not previously introduced into Belize. The government prefers joint venture and partnership investments, but does permit one hundred percent foreign ownership of an enterprise.
The Development Finance Corporation
The Development Finance Corporation (DFC) exists: "to strengthen and expand the Belizean economy consistent with the macro-economic policies of the Government of Belize, by providing high quality, efficient implementation and management of Development Financing and related services on a financially viable or agency basis ensuring self-sustainability".
The DFC's primary objective is to invest in Belizean companies, through the purchase of shares and the provision of loans. It is interested primarily in companies majority-controlled by Belizeans, but also lends to foreign-owned Belizean companies. The DFC also offers factory shells for rent at its Industrial Estates at Ladyville (Belize District) and San Andres (Corozal District).
In recent years, the DFC has been mired in political controversy and was accused of losing sight of its original objective by becoming a source of cheap government-backed loans for well-connected investors. The DFC was declared insolvent in 2004 after making a series of bad loans, but the institution reopened its doors in July 2009 following a clean-up operation by the Barrow administration, with its original mission of giving aspiring Belizean businessmen a leg up restored.
Investment incentives are contained in the following legislation:
- Fiscal Incentive Act, No. 6 of 1990;
- International Business and Public Investment Companies (IBC) Act 1990;
- Mines and Mineral Act 1988;
- Export Processing Zone (EPZ) ACt 1990;
- Commercial Free Zone (CFZ) Act 1994;
- Fiscal Incentives Act 1990
The Fiscal Incentives Act (No.6) offers tax holidays and duty exemptions.
Tax holidays are normally offered for 5 years, extensible for up to a further 10 years; but in the case of agricultural investment may be for up to 25 years. However, there is a provision that the Minister for Economic Development, on application made by the company in a fit and proper case, can review the company's operations and renew the tax-holiday period for a further term not exceeding ten years.
Duty exemptions are offered to every company which has been granted an Approved Enterprise Order (Development Concession) to import into Belize, free of import duty, and revenue replacement duty, a wide range of industrial machinery, construction materials and raw materials. Exemption is normally given for 15 years, with a 10-year extension.
The terms of incentives are decided at Cabinet level. Companies applying under the Act need to be incorporated in Belize and applications have to be accompanied by:
- a copy of Memorandum and Articles of Association;
- copy of Certificate of Incorporation;
- banker's reference on the bank's official letter-head;
- land tenure deed;
- proforma profitability statement up to the second year of full production;
- list of items requested for duty exemptions;
- details of local inputs.
Application fees depend on the level of proposed investment, and at the time of writing, are as follows:
- Investment up to USD250,000, fee USD3,500;
- Investment between USD250,000 and USD500,000, fee USD7,500
- Investment between USD500,000 and USD2,500,000, fee USD10,000.00;
- Investment over USD2,500,000, fee USD10,000.00
For further information, contact:
Ministry of Economic Development
Belmopan, BELIZE C.A.
Tel. No.: (501)-8-22526
Fax No.: (501)-8-23111
In 2008, the Belize Trade and Investment Development Service (BELTRAIDE) announced that its focus will be trained on three strategic areas: Investment Promotion, Entrepreneurial Development, and Marketing.
As part of its strategy on investment promotion, BELTRAIDE is compiling a National Export Strategy which contains details on five priority investment sectors which possess a greater level of competitive advantage for Belize.
A Belize Marketing Study has been carried out, which identifies the potential of markets for niche-non-traditional products. This study will be an essential tool for Belizean producers to take advantage of trade opportunities in Central America, the United States, CARICOM and European Union.
To create a more conducive environment that stimulates growth in entrepreneurial development for small and medium-sized businesses, BELTRAIDE, in collaboration with the Commonwealth Secretariat, is working on a National SME Policy to address the issues and challenges affecting the development of micro, small and medium sized enterprises.
BELTRAIDE’s Executive Chairperson, Lourdes Smith announced in early 2008 that the organisation had another active and successful year in 2007. It interacted with 2,500 clients who were interested in trade and investment information on Belize, assisted in the development of twelve business plans, and conducted a series of business match-making undertakings with 41 furniture makers to improve their capacities.