Late News from Belize

SUGAR REEF IN PLACENCIA BURNS A fire on 10 November partially destroyed Sugar
Reef, a popular palapa bar on the back side of Placencia village, on a canal.
Sugar Reef formerly was called The Lagoon.

WITH BELIZE GOVERNMENT FINANCES IN SHAMBLES, WILL TAXES GO UP? The Belize
government faces a series of unprecedented financial problems: a current budget
deficit nearing 6% of GDP, the liquidation of the Development Finance
Corporation, the Novelo’s bus line and Social Security fiascos, the Carnival
Cruise Line, BTL sale and Chiallo Dam controversies, to name only a few.
“Many errors were made,� said Prime Minister Said Musa, in a recent radio
interview. The question now is whether the government will finally move to
resolve these problems and raise at least US$35 million to plug the deficit. A
few steps already have been taken. The International Monetary Fund has been
called in, the Belize Central Bank has raised the reserve ratio at Belize
banks, several Belize embassies and consulates are being closed, and Musa has
said government may reduce the salaries of cabinet members and area
representatives. No one thinks that will generate enough revenue, however.
Observers say they think increases in sales, income and tourism taxes are
inevitable ... and coming soon.

BANK ACCOUNTS FOR NON-RESIDENTS NIXED According to a statement from the Belize
Central Bank, effective November 2004 non-residents no longer may have bank
accounts with Belize-chartered banks. The notice reads:

Central Bank of Belize
Notice

The public is hereby informed that the Minister of Finance has signed a new
statutory instrument in order to cause section 4 of the International Banking
Amendment Act to come into effect on 1 November 2004. Section 4 repeals
subsection (2) of section 3 of the principal Act. As a result of the amendment,
domestic commercial banks licensed under the Banks and Financial Institutions
Act may no longer carry on banking business with non-residents. This action was
taken with a view to eliminating the co-mingling of funds and improving the
measurement of domestic liquidity in the banking system.

This could impact those who own vacation or investment property in Belize but
who are not official permanent residents or residents under the Qualified
Retired Persons program, or who are building a house or otherwise are doing
business in Belize and need to have a local bank account to pay bills in
Belize. However, non-residents can have accounts with Belize offshore banks.
Also, as a practical matter, many non-residents with interests in Belize
maintain their banking relationships back home and transfer funds via
traveler’s checks or through ATMs.

“TOUCAN TRAIL� INEXPENSIVE HOTEL SET TO LAUNCH The “Toucan Trail,� a
marketing initiative by the Belize Tourist Board to promore more than 100 small
hotels with rooms prices of US$60 a night or less, is under way. To date, the
BTB has visited 112 small hotels in 22 villages and towns. The hotels have to
meet specific criteria set by the BTB, and operators have to sign a pledge of
good business practices. These hotels will be listed and profiled on a web
site, www.toucantrail.com, which is expected to be fully operational by the end
of 2004, according to the BTB.

MAYA ISLAND DISCONTINUES SERVICE TO SAN IGNACIO Maya Island Air has
discontinued service to the airstrip near San Ignacio. The service, less than
a year old, at one time included three flights a day from the international
airport in Belize City to the airstrip near Central Farm in Cayo.

NEW JET SERVICE FROM BELIZE CITY TO FLORES AND GUATEMALA CITY Tikal Jets, a
Guatemalan airline, has started service between Belize City (international) to
Flores (near Tikal) and Guatemala City. Promotional fares make travel on the
route almost as cheap as going by bus. Belize City to Flores initially is US$25
one-way, and Belize City to Guatemala City is US$65 one-way or US$129
round-trip. Regular fares shown on the Tikal Jets web site are US$149
round-trip Belize City-Guatemala City and US$69 round-trip Belize City-Flores,
still less than half the fare on Maya Island or Tropic. The Tikal Jets fares
are only a little more than deluxe bus service and require only a fraction of
the time. These prices do not include taxes or exit fees, which in the case of
the international air exit fee from Belize (US$35) is actually more than the
ticket price to Flores. Service, initially only twice a week on Mondays and
Fridays, is on a 123-passenger DC-9 jet. Flights leave Goldson at 9:30 a.m. and
arrive in Guatemala City at 11:40 a.m. Returning, flights depart Guatemala City
at 6:30 a.m. and arrive Belize City at 8:45 a.m. Flights include approximately
one-half hour ground time in Flores. Information on the flights is available at
www.tikaljets.com. Tikal Jets also has service from Guatemala City to Havana,
Cancun, Mexico City and San Pedro Sula, Honduras.

--Lan Sluder
www.belizefirst.com