BELIZE INPUT TO CARIBBEAN BASIN RECOVERY ACT REPORT

UNCLAS BELMOPAN 000650

SIPDIS

SIPDIS


FOR WHA/CEN//ROIS BEAL
PASS USTR FOR KENT SHIGETOMI
E.O. 12958: N/A
TAGS: PGOV ECON BH
SUBJECT: BELIZE INPUT TO CARIBBEAN BASIN RECOVERY ACT REPORT

REF: STATE 143212

Following is the text requested by REFTEL.

Belize

Population: 311,480

Per Capita GDP: $4,070
Source: Statistical Institute of Belize

Economic Review: Belize's 2007 economic growth rate is projected to
be 4.4 percent, with inflation at 5.1 percent. The most significant
economic issues currently facing Belize are: (1) foreign debt in
excess of 100 percent of GDP, (2) pressures on the official exchange
rate of 2 BZD to 1 USD, leading to shortages of U.S. dollars at the
official rate, (3) the deteriorating balance of payments, and (4)
growing public perception of the extent of political corruption and
government mismanagement of public funds. Several of these problems
are attributable to heavy government spending that has continued in
the run-up to general elections scheduled for 2008. The spending
has led to ballooning foreign debt and a widening trade deficit.

Foreign Trade:
Trade in Goods with U.S: 2006
NOTE: All figures are in U.S. dollars.
Source: Statistical Institute of Belize

Belize continues to rely heavily on foreign trade, with the United
States as its number one trading partner. Imports in 2006 totaled
$255.39 million, while total exports were only $112.22 million.

Commitment to WTO and FTAA: Although Belize has been a WTO member
since January 1, 1995, the country rarely participates in WTO
deliberations. Belize also faces difficulties in implementing WTO
agreements effectively, due to limited staff in the government's
lead trade negotiating agency. Belize supports the FTAA and
participates in other regional and international trade negotiations
in close coordination with CARICOM's Regional Negotiating
Machinery.

Intellectual Property Laws: Belize has enacted laws that provide
for the protection of intellectual property rights consistent with
the protection afforded under the TRIPS Agreement. These IPR laws,
all enacted in January 2001, include the Trade Marks Act, the
Copyright Act, the Industrial Designs Act, the Patents Act, the
Protection of Layout-Designs (Topographies) of Integrated Circuits
Act, and the Protection of New Plant Varieties Act. Along with the
enactment of these measures, Belize acceded to the Paris Convention
for the Protection of Industrial Property, the Berne Convention on
Protection of Literary and Artistic Works and the Patent Copyright
Treaty.

Intellectual Property Infringement:
Government-owned entities generally do not broadcast copyrighted
material belonging to U.S. copyright-holders without consent.
However, music and video stores in Belize continue to carry
hand-copied CDs, DVDs, and tapes for sale or rent. Local television
stations and cable companies also continue to pirate American
television networks and cable channels with impunity. Local
importers, particularly those operating in the commercial free zone
in Northern Belize, continue to bring in counterfeit merchandise
bearing U.S. trademarks. To date there have been no successful
prosecutions in the area of intellectual property protection.

Provision of Internationally Recognized Worker Rights: The
Constitution of Belize provides for freedom of assembly and
association. The Trade Union and Employee's Organizations Act of
2000 establishes procedures for the registration and status of trade
unions and employers' organizations, promotes and protects the
recognition of trade unions, and encourages orderly and effective
collective bargaining.

The Constitution of Belize prohibits slavery, and provides that no
person shall be required to perform forced labor. The Labor Act of
Belize likewise states that "no person shall impose or permit the
imposition of forced or compulsory labor as a (a) means of political
coercion or as a punishment for holding or expressing political
views or views ideologically opposed to the established political,
social or economic system; (b) method of mobilizing and using labor
for purposes of economic developments; (c) means of labor
discipline; (d) punishment for having participated in strikes; and
(e) means of racial, social, national or religious discrimination."

Minimum wages are prescribed for three categories of workers, namely
manual workers, shop assistants, and domestic workers. Regarding
work hours, the Labor Act of Belize also states that no worker shall
be obliged to work more than 6 days in any week or for more than 9
hours of actual work in any day, for 45 hours of actual work in any
week. The labor law of Belize also states that it is the duty of
the employer to take reasonable care for the safety of his employees
in the course of their employment. Belize labor law further states
that every employer who provides or arranges accommodation for
workers to reside at or in the vicinity of a place of employment
shall provide and maintain sufficient and hygienic housing
accommodations, a sufficient supply of wholesome water, and
sufficient and proper sanitary arrangements.

Commitments to Eliminate the Worst Forms of Child Labor: Belize has
ratified International Labor Organization Conventions 29 (Forced
Labor),138 (Minimum Age),105 (Abolition of Forced Labor),and 182
(Abolition of the Worst Forms of Child Labor). These Conventions
are embedded in the Trade Unions and Employers' Organizations
Registration, Recognition and Status Act of 2000. Belize has also
signed a Memorandum of Understanding with the ILO-IPEC. In 2005,
the Government of Belize began participating in a USDOL-funded
regional project implemented by ILO-IPEC to combat the commercial
sexual exploitation of children with some of the programming being
implemented in 2007.

The Labor Act of Belize is inconsistent in how it defines the
minimum age of employment in Belize. In some sections it is listed
as 12 while in others it appears to be 14. In one section the Act
provides that "no child shall be employed so long as he is under the
age of twelve years", while another provides that persons who have
attained the age of 14 years but are under the age of 18 years may
only be employed in an occupation that a labor officer has
determined is "not injurious to the moral or physical development of
non-adults," typically light work that is not harmful to life,
health or education.

Counter-Narcotics Cooperation: The President has not identified
Belize as a major drug transit or major illicit drug producing
country under the provision of the FRAA. In addition, the
Government of Belize and the U.S. Government concluded a Stolen
Vehicle Treaty, an Extradition Treaty, and a Mutual Legal Assistance
Treaty, which were brought into force between 2001 and 2003.
However, recent extradition requests and stolen car inquiries made
to the government of Belize have been delayed or ignored.

Implementation of the Inter-American Convention Against Corruption:
Belize signed the IACAC at the Organization of American States
General Assembly in San Jose, Costa Rica, on June 7, 2001. Prior to
this, Belize's first step to combat corruption in public life came
with the enactment of the Prevention of Corruption in Public Life
Act in 1994. This act contains various provisions designed to
reduce political corruption, including requirements for the public
disclosure of the assets, income and liabilities of public
officials, such as the Governor-General and members of the national
assembly. However, the penalties for noncompliance are so minimal
that the rules are routinely ignored and to date there have been no
enforcement actions to combat corruption. The perception of
corruption at high levels of the government continues to increase
according to World Bank and Transparency International's corruption
perception indices. The government also appointed a parliamentary
commissioner, known as the Ombudsman, to investigate administrative
actions and allegations of official corruption and wrongdoing, but
to date there have been no prosecutions for official corruption.

Transparency in Government Procurement: Standards ensuring
transparent, nondiscriminatory and competitive procedures in
government procurement are laid out in the Stores and Financial
Orders under the Finance and Audit Act of the Laws of Belize.
However, some questions exist regarding the extent to which certain
government ministries, departments, and agencies adhere to these
standards. For instance, under the Orders, government purchases of
over US$50,000 must be submitted for public bidding by both local
and foreign companies, but it appears this is not done in many
cases. Bidders for tenders for externally-funded projects must
comply with the procurement rules and regulations of the foreign
funding organization. The Contractor-General is perceived as
ineffective in monitoring the award and implementation of public
contracts or sale of public assets, as there have been several cases
in which contracts have been awarded without apparent merit, and
public assets have been sold under dubious circumstances.

Several U.S. oil companies have complained about lack of
transparency in the granting of oil contracts. They complain that
local Belizean companies are offered preferential terms. The
companies cite bribery and political handouts as reasons for the
government's agreement to such terms.

Nationalization/Expropriation: Innovative Communication Cooperation
(ICC) originally purchased Belize Telecommunications Limited (BTL)
from the Government of Belize in April 2004. In February 2005, the
Government of Belize took control of BTL, alleging that ICC had
failed after several extensions to make remaining payments for BTL
shares. ICC countered that the Government of Belize had failed to
make certain regulatory changes as agreed. Extensive litigation is
ongoing.

In addition, there have been several cases in which the government
has exercised its right of eminent domain to expropriate property,
including that of some foreign investors.

Preferential Treatment - Developed Countries: Belize does not
afford preferential treatment to the products of a developed country
other than the United States. While Belize is a beneficiary of
multilateral trade agreements that CARICOM has negotiated and signed
on behalf of its member states, reciprocity of preferential
treatment applies only to the five more developed countries within
CARICOM, and not to Belize.

Extradition: Belize and the United States signed an extradition
treaty in April 2000 and exchanged instruments of ratification in
March 2001.

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