Belize is a country that has been on my bucket list for a long time. For this reason, I am constantly researching about this tiny yet diverse country and in this article, I am going to share with you what I know about Belize and its current situation.
Belize is a Central American country sharing its borders with Mexico, Guatemala, and the Caribbean Sea. It is a tourist attraction for many people from around the world and is famous for its picturesque landscapes and rich biodiversity.
Belize is still in a developing state. Yet, Belize being a third world and being a poor country, is very discussable.
Belize is an upper-middle-income country and an emerging economy. Belize is sometimes considered a third-world country due to widespread poverty, lack of basic human necessities, poor rule of law, corruption, environmental issues, and a significant crime rate. Yet, Belize can be more accurately classified as a developing country.
In cold war terminology of first, second, and third world countries, Belize is a third world country because Belize was not an ally of the US or the Soviet Union during the Cold War Era.
So far, growth strategies have been implemented to curb present issues and resulted in a modest, yet encouraging economic growth rate.
Where is Belize?
If I would hand a world map to you and ask you: “Where is Belize?”, would you be able to point it out?
Don’t worry, it’s totally fine if you can’t tell, but from now on, you will know exactly where the beautiful country of Belize is.
Belize or formerly known as British Honduras, can be found along the Caribbean Sea in Central America. Its neighborhood consists of Mexico to the north, the Caribbean Sea to the east, and Guatemala to the south and west.
The tiny English-speaking country of Belize has the lowest population and population density in all of Central America.
Known for its paradise-like beauty of stunning beaches and lush jungles, Belize is a top spot for eco-tourists.
Before we analyze the nation and its status, here’s a brief overview of Belize’s fast facts.
Quick facts about Belize
|Largest City||Belize City|
|Type of Government||Unitary parliamentary constitutional monarchy|
|Independence day||21 September 1981|
|Religion||74.3% Christianity followed by others|
|Population||412,190 (as of 2022)|
|Currency||Belize Dollar (BZD)|
What is a third-world country?
The term “third-world” country came forth during the time of the Cold War in 1947-1989.
During this period, the world was divided into three groups: the first-world referring to the US, Western Europe, and their friends, the second-world (also called the Communist-Bloc) consisting of the Soviet Union, China, Cuba, and their allies, and the third-world consisting of all remaining nations that are neither aligned with the Western capitalism nor the Soviet socialism.
Over time, the initial meaning of these terms changed widely and was more used to describe the economic state of a country.
The term first-world now describes economically strong, wealthy, industrialized, and highly developed nations.
Second-world countries are more in the middle. They are not quite poor but aren’t very prosperous either.
Third-world countries are economically underdeveloped countries. However, this term is outdated.
Nowadays, the preferred terminology for such nations is developing country, underdeveloped country, or low- and middle-income country.
Why is Belize considered a third-world country?
Belize is no doubt a famous vacation spot for eco-tourism due to its picturesque landscapes and bio-diversities. Yet, Belize faces challenges in numerous sectors that have damaging impacts on the country and its people.
Some of these challenges include widespread poverty, high public debt, and natural disasters like hurricanes.
In a 2022 listing of third-world countries, Belize was included as a developing country with an HDI (Human Development Index) of 0.708.
Let me inform you, any HDI score of 80 or higher is considered a well-developed country. Therefore, Belize being not far away from this number is not as underdeveloped as you might assume. Actually, it is heading in a good direction.
Here are some of its economy’s strengths and weaknesses.
|Highly competitive tourism industry compared to other regional countries||High debt burden|
|Great tourism potential due to Maya heritage and the world’s second-largest barrier reef||Unvaried exports (40% of Belize’s economy relies on tourism)|
|Gets support from international lenders||Underdeveloped manufacturing sector|
|The agricultural sector was exposed to dreadful climatic events|
|Limited access to international markets|
|Limited access to education|
Keeping this brief overview in mind, let me explain to you some of these aspects in more detail and get to know what exactly Belize is struggling with and why.
Let’s dive in.
Belize is an upper-middle income country with a GDP per capita of around 4,435 USD. Despite this, Belize’s poverty rate is very high.
According to UNICEF, 42% of Belizeans live at or below the poverty line of which children are the most affected. Nearly 50% of children under the age of 15 suffer from poverty while 58% of Belize’s youth under the age of 18 is classified as multidimensionally poor.
These Belizean children lack access to basic human needs like clean drinking water, proper sanitation, adequate nutrition, and housing as well as access to information and education.
It has also been observed that different ethnic groups, especially the indigenous Maya population suffer from poverty more than others due to a disparity in income levels among ethnic groups.
Furthermore, the country experiences widespread malnutrition among children. Also, according to the Health Care Access and Quality Index, Belize rates 55.7 out of 100.
In general, Belize gets a poor grade in health care. Yet, steady improvements have been seen during the last few years including an expected increase in government spending.
This will help reduce the healthcare spending directly paid by the people who are already struggling to meet ends.
Another, yet very important factor contributing to Belize’s poverty rate is its agriculture sector.
The agricultural sector is the most significant industry of Belize’s economy but also the most vulnerable to the devastating effects of environmental disasters like hurricanes. Whenever the agricultural sector suffers, an immense impact on the availability of food and on the lives of people follows.
About 40% of Belizeans depend on agriculture, which in such scenarios, leads to an even higher poverty rate.
Unemployment adversely affects a country and its people in several ways.
When the unemployment rate of a country remains high it negatively influences economic growth.
It leads to a waste of resources and labor forces, reduced productivity and economic output of the country, a high crime rate, poverty, and diminishes purchasing power.
But unemployment does not only affect a country’s economy. It also impacts its people mentally and physically.
People who experience unemployment are fall victim to at least one of these things:
- Severe financial hardship
- Housing stress
- Family tensions & breakdowns
- Increased social isolation
- Destruction of confidence and self-esteem
- Atrophying work skills
- Development of health issues due to mental burden
That being said, the unemployment rate of Belize is currently at 9.2% (2021) stated by the Statistical Institute of Belize.
Even though the nation’s labor force increased significantly due to Belize’s growth in population, the same increase could unfortunately not be seen in terms of job creation and job opportunities.
In combination with this problem, Belizeans remain in search of work for six months or even more.
Weak Institutional and Legal Frameworks
Unfortunately, Belize continues to come face to face with its economic and political demons.
The World Justice Project’s Rule of Law Index in 2021 graded Belize with an overall score of 0.48 (0 = weak adherence to law, 1= strong adherence to law). In its overall global ranking, the country was at 93rd place out of 139 countries.
The country widely struggles with government corruption due to its location, porous borders, poverty, a high rate of violent crime, police brutality, illegal migration, and illicit trafficking within its borders.
Belize also lacks in safeguarding its natural resources due to its weak rule of law. Environment relating crimes include:
- Illegal hunting
- Illegal logging
- Illegal harvesting of flora and fauna
- Looting of the extensive cave system
- Increase in the introduction of invasive species
The Belizean Police enforcement has implemented numerous protective measures to curb the high number of crimes. More patrols were added to “hot spots” in the city, and more resources were obtained to deal with problematic situations.
Moreover, the government also launched crime-fighting initiatives like the “Do the Right Thing for Youths at Risk” program, the Crime Information Hotline, and the Yabra Citizen Development Committee. Still, anti-corruption laws remain poorly enforced.
The country lacks the financial resources, capacity, and personnel to sustainably manage its bureaucratic sectors. Besides that, the absence of coordination and teamwork among official ministries continues to plague the country in efforts towards a strong law system.
For its small size, Belize is incredibly diverse ecologically speaking.
Due to the country’s distinct location between North and South America and its abundant range of climates and habitats, Belize is home to a loaded variety of wildlife and plants.
In Belize, there are hundreds of species of animals and more than 5000 types of plants. However, its forest and marine life are under serious threat.
The main reasons for Belize’s environmental problems are the following:
- High deforestation rates
- Rapid coastal development for residential and commercial purposes
- Improper solid and liquid waste management
- Discovery of sweet crude oil posing potential pollution threats to habitats
- Rising poverty rates lead to dependency on agriculture and overharvesting species and extensive slashing and burning of forests
- Rising sea levels and sea temperatures, coastal erosions, and less rainfall due to climate change
- Constant threats of hurricanes
That being said, Belize must address these issues immediately and effectively utilizing the best possible management practices. All of these factors are already major issues but in the long run, these problems can put the country in an emergency situation.
Many efforts can be seen in the protection of Belize’s wildlife and natural habitats.
60% of the country’s land is covered by forests while some 20% of Belize’s land consists of cultivated land and human settlements.
Interestingly, 37% of Belize’s land area is under some kind of official protection.
That makes the nation one of the largest systems of terrestrial protected areas in the Americas and of the most notable leaders in protecting natural resources and biodiversity in the world.
Foreign debt burden
Belize is home to the smallest economy in Central America.
It has a GDP (Gross Domestic Product) of $1.91 billion in 2021, a modest, yet encouraging improvement compared to its previous year with a GDP of $1.71 billion.
However, due to intensifying fiscal pressure and a need to expand its economy by bringing variety to it, the Government of Belize actively looks out for foreign direct investment, also known as FDI.
But then again, considering the country’s small population (2022 – 412,190 people), high public debt, high cost of doing business, often inadequate infrastructure, official/governmental delays, and corruption act as a blockage to possible investments.
Furthermore, the Covid-19 pandemic had a tremendous impact on Belize.
It triggered a 71% decline in tourist arrivals along with a 16.7% decrease in real GDP in 2020. As a result, the fiscal revenues of the country dropped and pandemic-related spending rose. This ultimately led to a public debt increase of 133% of GDP which was currently classified as “unsustainable” by the IMF.
Yet, in response to this, the Belizean government introduced a Medium-Term Recovery Plan (MTRP) in 2021 which is intended to reduce public debt to 85 percent of GDP in 2025 and even 70 percent in 2030.
Noteworthy progress en route for restoring debt sustainability has already been made in 2021. Despite being still in deficit, Belize’s public balance is expected to improve in 2022 and its upcoming years.
Is Belize’s economy growing or declining?
Now that you’ve come to know about the major drawbacks of Belize’s developing economy, you may ask yourself: “Is Belize’s economy actually making progress, or is it regressing instead?”
After experiencing a five-year trend of negative economic growth, Belize had finally seen some improvement in 2021.
Yet, after that mild recovery from the previous year, Belize’s economic growth seems to be losing its steam again.
Currently, the country’s economic freedom score lies at 56.6 placing its economy at 109th place in the 2022 Index. If we narrow it down to the Americas, Belize landed at 22nd place among 32 countries. Still, its overall score is below the regional and world average.
There are several governmental strategies intended to accelerate healthy and stable economic growth for example:
- The Growth and Sustainable Development Strategy of Belize (2016-2019)
- Horizon 2030 – National Development Framework Belize
Nevertheless, the nation’s economic performance is susceptible to external market changes.
Another factor that determines Belize’s economic growth or decline is its trade deficit. In 2020, its trade balance amounted to around -0.79 billion U.S. dollars.
A trade deficit may sound like an alarming thing, but it’s not necessarily an entirely bad or good thing.
Potential deficit advantages are benefits for consumers, increased local spending, and increased foreign investment. On the other hand, potential disadvantages could be a foreign buyout, currency problems, increased budget deficits, and dependency on foreign countries.
Belize’s tourism sector has been witnessing tremendous growth over the past years. It is the country’s second-largest economic sector and its top foreign exchange and revenue earner.
Due to Belize being such a small country, the potential for further growth of its tourism industry is high.
Since 2016, the country has observed overnight tourist arrivals resulting in double-digit annual growth rates.
Moreover, tourism in Belize opened doors to numerous other sub-sectors like auto rental and (water) taxis sectors depending on tourists as well as farmers and fishermen who rely on hotels and restaurants where tourists consume the fresh produce.
As Belize is becoming more and more attractive and accessible to foreign tourists, its tourism-related sub-sectors are also evolving.
It created several investment and trade opportunities like
- Eco and adventure tourism
- Beach resorts
- Trail and caving systems
- Developing nature
- Cruise tourism facilities (restaurants, cafes and bars, shopping centers, auto rental services, natural parks, and adventure services)
- Nautical tourism (marinas, diving services, cruise tendering services, yachts, boats)
What’s Belize Like?
Squeezed between Mexico and Guatemala, the small country of Belize has turned into one of the most sought-after ecotourism destinations in Central America.
Lush tropical rain forests, breathtaking beaches, and ancient Maya cities are only a small fraction of the many natural attractions and captivating beauty of Belize.
It is home to the region’s last unblemished marine and rainforest habitats and brings some of the most exciting adventures giving you a time to remember.
Due to its sub-tropical weather, Belize is a great vacation destination all year round.
Furthermore, Belize is the heart of the ancient Maya civilization leaving its traces throughout the country. Altun Ha, Xunantunich, Caracol, Santa Rita, Cahal Pech, and Barton Creek Cave are among its must-visit places.
The country is packed with rich culture, incredibly diverse wildlife and nature, the world’s largest barrier reef in Northern and Western Hemispheres, delicious food, and fun activities to do.
In simple words, Belize is the perfect getaway if you’re looking for jaw-dropping landscapes and exciting adventures.
This article is
written by Asma Schleicher and edited by Efe Genit. Asma is a creative writer with German and Pakistani roots. She is an analytical writer with a degree in business administration. In this blog, she mostly writes about cultural, travel, and fashion-related topics reflecting her real-life experiences. You can also check Asma’s profile in Upwork.