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Country Commercial Guides for FY 2000: Belize Report prepared by U.S. Embassy Belize City, released July 1999 Note*

III. POLITICAL ENVIRONMENT

U.S. - BELIZE RELATIONS:

THE UNITED STATES AND BELIZE HAVE TRADITIONALLY ENJOYED CLOSE AND CORDIAL RELATIONS. THE U.S. IS BELIZE'S PRINCIPAL TRADING PARTNER: IN 1998, THE U.S. SUPPLIED 49 PERCENT OF BELIZE'S IMPORTS AND BOUGHT 37.3 PERCENT OF BELIZE'S EXPORTS. THE U.S. IS ALSO THE PRIMARY SOURCE OF INVESTMENT FUNDS AND HOME TO THE LARGEST BELIZEAN COMMUNITY OUTSIDE BELIZE. BECAUSE BELIZE'S ECONOMIC GROWTH AND DEMOCRATIC POLITICAL STABILITY ARE IMPORTANT U.S. OBJECTIVES IN AN OFTEN TROUBLED REGION, BELIZE BENEFITS FROM THE CENTRAL AMERICAN AND CARIBBEAN BASIN INITIATIVE (CBI).

INTERNATIONAL CRIME ISSUES DOMINATE THE AGENDA OF BILATERAL RELATIONS BETWEEN THE U.S. AND BELIZE. THE U.S. HAS SOUGHT A COOPERATIVE EFFORT WITH BELIZE IN THE FIGHT AGAINST ILLICIT NARCOTICS. THE U.S. IS ALSO WORKING WITH BELIZE TO CONTROL THE FLOW OF ILLEGAL IMMIGRANTS TO THE U.S. THROUGH BELIZE. IN 1997, THE U.S. GOVERNMENT AND GOB SIGNED A "STOLEN CAR TREATY." BELIZE IS CONSIDERED A MAJOR DRUG TRAFFICKING COUNTRY BECAUSE OF ITS VULNERABLE POSITION AS A TRANSIT POINT FOR ILLICIT NARCOTICS. THE U.S. DRUG ENFORCEMENT AGENCY MAINTAINS AN OFFICE IN BELIZE CITY TO ASSIST BELIZEAN OFFICIALS IN THEIR EFFORTS TO DISRUPT, DISMANTLE, AND DESTROY MAJOR DRUG TRAFFICKING ORGANIZATIONS IN BELIZE.

THE UNITED STATES CONTRIBUTED $1.9 MILLION IN VARIOUS BILATERAL ECONOMIC AND MILITARY AID PROGRAMS TO BELIZE IN 1998. THE U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT (USAID) CLOSED ITS BELIZE OFFICE IN AUGUST 1996 AFTER A 13-YEAR STINT DURING WHICH USAID PROVIDED $110 MILLION WORTH OF DEVELOPMENT ASSISTANCE TO BELIZE. ALTHOUGH NOT PHYSICALLY PRESENT IN BELIZE, USAID CONTINUES TO ASSIST THE GOB IN VARIOUS REGIONAL PROJECTS IN LABOR, TRADE, ENVIRONMENT, AND HEALTH FROM ITS OFFICES IN GUATEMALA. IN ADDITION, DURING THE PAST 35 YEARS, OVER 1600 PEACE CORPS VOLUNTEERS HAVE SERVED IN BELIZE. THE PEACE CORPS CURRENTLY HAS 48 VOLUNTEERS WORKING IN BELIZE. IN PUNTA GORDA, VOICE OF AMERICA OPERATES A MEDIUM-WAVE RADIO RELAY STATION THAT BROADCASTS TO THE NEIGHBORING COUNTRIES OF HONDURAS, GUATEMALA, AND EL SALVADOR. THE U.S. MILITARY HAS A DIVERSE ASSISTANCE PROGRAM IN BELIZE, WHICH INCLUDES TRAINING OF THE LOCAL DEFENCE FORCE AND EQUIPMENT. LAST, BUT NOT LEAST, PRIVATE AMERICAN INVESTORS, RESPONSIBLE FOR SOME $260 MILLION TOTAL INVESTMENT IN BELIZE, CONTINUE TO PLAY A KEY ROLE IN BELIZE'S ECONOMY.

MAJOR POLITICAL ISSUES AFFECTING BUSINESS CLIMATE:

BELIZE IS A PARLIAMENTARY DEMOCRACY THAT HAS TRADITIONALLY ENJOYED A STABLE POLITICAL AND ECONOMIC ENVIRONMENT. HOWEVER, BECAUSE OF THE ANTAGONISTIC RIVALRY BETWEEN THE TWO MAJOR POLITICAL PARTIES, PARTY PATRONAGE DOES INFLUENCE LOCAL GOVERNMENT EXPENDITURES AND, OCCASIONALLY, FOREIGN INVESTMENTS. FOR INSTANCE, THE BELIZE AIRPORTS AUTHORITY -- A QUASI-GOVERNMENT INSTITUTION RUN BY A BOARD OF DIRECTORS -- FORCIBLY EJECTED A LEGIMATE U.S.-OWNED DUTY FREE SHOP FROM THE ARRIVAL LOUNGE OF THE INTERNATIONAL AIRPORT LAST MAY OVER A CONTRACT DISPUTE. THE DISPUTE HAS YET TO BE RESOLVED.

BELIZE HAS SUPPORTED THE IMPLEMENTATION OF A CARICOM SINGLE MARKET AND ECONOMY THAT WOULD GIVE SIGNIFICANT TRADE AND INVESTMENT PREFERENCES TO CARICOM MEMBER STATES. ADDITIONALLY, BELIZE HAS SOUGHT TO BUILD CLOSER TIES WITH THE NEIGHBORING SPANISH-SPEAKING COUNTRIES OF CENTRAL AMERICA TO COMPLEMENT ITS HISTORICAL TIES TO THE ENGLISH-SPEAKING CARIBBEAN STATES. BELIZE ESTABLISHED DIPLOMATIC RELATIONS WITH CUBA IN JULY 1995 AND FOLLOWING THE GENERAL ELECTIONS LAST AUGUST, THE PUP ADMINISTRATION OPENED AN EMBASSY IN CUBA.

GOVERNMENT AND POLITICAL SYSTEM:

BELIZE IS A PARLIAMENTARY DEMOCRACY ON THE WESTMINSTER MODEL AND IS A MEMBER OF THE COMMONWEALTH. QUEEN ELIZABETH II IS HEAD OF STATE AND IS REPRESENTED IN THE COUNTRY BY GOVERNOR-GENERAL DR. COLVILLE N. YOUNG, SR., A BELIZEAN. THE PRIMARY EXECUTIVE ORGAN OF GOVERNMENT IS THE CABINET, LED BY A PRIME MINISTER, WHO SERVES AS THE HEAD OF GOVERNMENT. CABINET MINISTERS ARE MEMBERS OF THE MAJORITY POLITICAL PARTY IN PARLIAMENT AND HOLD ELECTED SEATS IN THE NATIONAL ASSEMBLY CONCURRENTLY WITH THEIR CABINET POSITIONS.

THE NATIONAL ASSEMBLY CONSISTS OF A HOUSE OF REPRESENTATIVES AND A SENATE. THE 29 MEMBERS OF THE HOUSE ARE POPULARLY ELECTED TO A MAXIMUM 5-YEAR TERM. OF THE SENATE'S EIGHT MEMBERS, FIVE ARE ELECTED BY THE PRIME MINISTER, TWO BY THE LEADER OF THE OPPOSITION, AND ONE BY THE GOVERNOR-GENERAL.

THE BELIZE GOVERNMENT IS CONTROLLED BY THE PEOPLE'S UNITED PARTY (PUP), WHICH WON 26 OF THE 29 SEATS IN THE HOUSE OF REPRESENTATIVES IN AUGUST 1998, THE WIDEST WINNING MARGIN EVER IN THE HISTORY OF ELECTIVE POLITICS IN BELIZE. THE UNITED DEMOCRATIC PARTY (UDP) WON THE OTHER 3 SEATS. SINCE INDEPENDENCE IN 1981, THE GOVERNMENT HAS CHANGED HANDS WITH EACH NATIONAL ELECTION. IN EACH CASE, POWER TRANSFERRED PEACEFULLY BETWEEN THE PUP AND UDP. BEFORE 1984, THE PUP HAD DOMINATED THE ELECTORAL SCENE FOR OVER 30 YEARS AND WAS THE PARTY IN POWER WHEN BELIZE BECAME INDEPENDENT. THE UDP GOVERNED BELIZE FROM 1984-1989 AND 1993-1998. THE PUP GOVERNED FROM 1989-1993 AND 1998-PRESENT. THE NEXT NATIONAL ELECTION IS DUE BY AUGUST 2003.