Belize offers extraordinary investments opportunities for the wise investor. Government and business leaders have forged innovative strategies aimed at accelerating its already impressive growth rate. Where traditional crops like sugar, citrus and bananas have long been the mainstay of the economy, this small Caribbean country in Central America is looking for new opportunities where its natural resources, work force and proximity to the world’s largest trading block in North America give it a natural competitive edge. This is a Third World country with attendant challenges. In keeping with our tradition at Belize.com, we offer this investment guide along with unvarnished facts in stumbling blocks you may encounter on the ground.
The country offers a number of tax free regimes aimed at encouraging doing business in Belize. These are broken down into two types, Export Processing Zones and Commercial Free Zones.
EXPORT PROCESSING ZONES ACT – (Chapter 280 Laws of Belize) The Export Processing Zone (EPZ) Program attracts both local and foreign investments to boost production for export markets with a focus on manufactured goods and non-traditional agricultural products. An EPZ company is treated as being outside the customs territory of the host state, where export-oriented activities are undertaken in the manufacturing, processing, assembly, and service sectors.
Benefits of EPZs: Full import and export duty exemptions Exemptions from capital gains tax, property and land taxes, excise, sales and consumption taxes, taxes on trade turnover, on foreign exchange and transfer tax. Tax holiday of 20 years with an option to extend and deduct loses from profits following the tax holiday period. Dividend tax exemption in perpetuity. Opportunity to open foreign currency bank accounts in country and abroad. Opportunity to sell, lease or transfer items, goods and services within an EPZ. Exemption from the Supplies Control Act and its regulations. No import restrictions on raw materials. No import or export licensing requirement. No trade licenses. Customs inspection at the Zone for expediency.
COMMERCIAL FREE ZONES (CFZs) The Commercial Free Zone Act 1994 was established to attract foreign investment and provides for various activities including manufacturing, processing, packaging, warehousing and distribution of goods and services. Merchandize warehoused in a CFZ may be sold free of duty wholesale or retail: To diplomats of other countries To ships that dock at ports in Belize For direct export whether by sea, air or land For entry into national customs territory.
Benefits of CFZs in Belize: Duty exemptions available to investors in a CFZ on: (a) merchandize, articles or other goods entering a CFZ for commercial purpose. (b) fuel and goods including building materials, furniture, equipment, supplies and parts required for the proper functioning of the CFZ business. Exemption from income tax, capital tax, gains tax or any new corporate tax levied by the Government of Belize during the first 10 years of operation. Exemption from such tax for the first 25 years of operation on dividends paid by a CFZ business. Imports or exports by a CFZ business do not require an import or export license. No restrictions on the sale of foreign currency or transfer of foreign exchange in a CFZ. No Government charges and taxes imposed on the use of foreign currency in a CFZ. CFZ businesses are allowed to open an account in any currency with any registered bank. Income tax deductions on the chargeable income of every developer and CFZ business after the first 10 years of operation. CFZ businesses incurring a net loss over the 10 year tax holiday may deduct the loss against profits in the 3 years following the tax holiday period.
The country has enjoyed substantial growth in its industrial sector over the past ten years. Priority investment sectors for growth and development are based on natural, geographic, competitive, and comparative advantages. An economic quick take of industrial sectors includes Agriculture and Agribusiness, Tourism, Aquaculture and Fisheries, Information Communication Technology, Environmental Goods, Light Manufacturing, and more recently, Petroleum and petroleum by-products. Available are several attractive investment incentives in these priority sectors; including exemptions from import duties, tax waivers, ability to operate foreign currency accounts, international business companies, trusts, offshore banking and retirement. The official retirement incentives program is not really practical
Advisory for those contemplating business in Belize: While it offers good investment opportunities, businesspersons would be well advised to seek independent information before contemplating any investment. A good place to start would be with your country’s foreign affairs department, embassy or consulate. Belize is a developing country and questions on legal certainty and political interference are concerns. The government in 2010 expropriated the country’s largest telecommunications company, and more recently passed into law measures to prevent investors from having recourse to international arbitration.
Opportunities For Export Investments
Belize isn’t only a vacation paradise for scuba divers, eco-tourists, nature lovers, and Mayaphiles. A politically and financially stable English-speaking democracy, it offers exciting business opportunities for the investor, the would-be expatriate and those seeking the shelter of an off-shore business corporation or trust.
Being a member of CARICOM (Caribbean Community) as well as a member of SICA (Sistema de la Integracion Centroamericana), the country has good potential for regional trade – much of it underutilized. Our country is now implementing an Economic Partnership Agreement with the European Union (EU), and plans to establish other international economic agreements. Trade with Central America and Mexico is small due to governments traditionally looking to the tiny island nations in the Caribbean for trade. But the weight of requirements by bodies such as the WTO is slowly forcing Belize to accept the reality that there are many missed opportunities for trade with its Spanish-speaking neighbors.
This country ideal on-shore and off-shore investment destination with a focus on niche products and services. It specializes in high quality niche products and services that are unique, not only in style and function, but also in origin and history.
In a world that pays a premium for niche products that are natural, organic or have a fair trade relationship, this country makes an ideal target for investors. Growing demand for the Made In Belize brand includes fair trade sugar, honey, cocoa, orange and other citrus juices, pepper sauces and condiments. The government officially encourages investments in the following key sectors: agriculture, furniture manufacturing, agro processing, call centers and international finance.