Annual Report on Exchange Arrangements and Exchange Restrictions, 2007
Chapter

BELIZE

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
October 2007
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(Position as of December 31, 2006)

Status under IMF Articles of Agreement
Article VIIIDate of acceptance: June 14, 1983.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2006.
International security restrictionsNo.
References to legal instruments and hyperlinksn.a.
Exchange Arrangement
CurrencyThe currency of Belize is the Belize dollar.
Exchange rate structure
UnitaryEffective January 1, 2006, the exchange rate structure was reclassified to unitary from dual due to technical correction in the classification.
Classification
Conventional pegged arrangementThe Belize dollar is pegged to the U.S. dollar, the intervention currency, at the rate of BZ$1 per US$0.5. The Central Bank of Belize (CBB) quotes daily rates for the Canadian dollar, the pound sterling, and a number of currencies of CARICOM member countries. Commercial banks are allowed to buy and sell foreign exchange at the official rate. Since the closing down of exchange houses, all transactions in foreign exchange have to be conducted through ADs (i.e., commercial banks, the Postmaster General, the Accountant General, and Belize Global Travel Services).
Exchange taxA stamp duty of 1.25% is levied on all conversions from the Belize dollar to a foreign currency.
Exchange subsidyNo.
Forward exchange marketNo.
References to legal instruments and hyperlinksn.a.
Arrangements for Payments and Receipts
Prescription of currency requirementsEPZ businesses may use only U.S. dollars for all transactions except payments for labor, which may be made in domestic currency.
Controls on the use of domestic currencyControls apply to the use of domestic currency for current and capital transactions and payments.
Use of foreign exchange among residentsResidents with earnings in foreign exchange may pay their taxes, utility bills, and other expenses in U.S. dollars.
Payments arrangements
Regional arrangementsBelize is a member of CARICOM.
Clearing agreementsBelize participates in the CMCF.
Administration of controlThe CBB is responsible for administering exchange controls, which apply to transactions with all countries. Authority covering a wide range of operations is delegated to commercial banks in their capacity as ADs. All applications for foreign exchange processed by ADs are regularly forwarded to the CBB for audit and record keeping. Capital transactions are subject to CBB approval.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)
On domestic ownership and/or tradeResidents may not hold monetary gold except with specific authorization from the CBB.
On external tradeMonetary gold may not be imported or exported without the approval of the CBB.
Controls on exports and imports of banknotes
On exports
Domestic currencyEach traveler may take abroad up to BZ$500. Amounts beyond this limit require the approval of the CBB, which is liberally granted when justified.
Foreign currencyThe amount of foreign currency that each resident traveler may take abroad is limited. Nonresidents may take out up to the equivalent of BZ$500 or up to the amount imported.
On imports
Domestic currencyEach traveler may bring in up to BZ$500.
References to legal instruments and hyperlinksn.a.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyDomestic commercial banks are authorized to open foreign currency accounts for residents. The CBB reserves the right to prohibit specific accounts.
Approval requiredYes.
Held abroadForeign currency accounts held abroad must be approved by the CBB.
Approval requiredYes.
Accounts in domestic currency held abroadn.a.
Accounts in domestic currency convertible into foreign currencyNo.
References to legal instruments and hyperlinksn.a.
Nonresident Accounts
Foreign exchange accounts permittedOnly international banks may maintain foreign currency accounts for nonresidents.
Domestic currency accountsNonresidents are allowed to have domestic currency accounts with domestic commercial banks. These accounts may be credited with proceeds from the sale of foreign currency.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a.
Imports and Import Payments
Foreign exchange budgetYes.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsPrepayments for imports require authorization from the CBB.
Letters of creditYes.
OtherYes.
Import licenses and other nontariff measures
Negative listFor reasons of health, standardization, and protection of domestic industries, import licenses from the Ministry of Industry are required for a number of goods, mostly food and agricultural products and certain household and construction products; such licenses are granted liberally.
Import taxes and/or tariffsCustoms duties corresponding to the fourth phase of the CARICOM CET range from 5% to 20%, with a number of items (particularly agricultural inputs) entering duty-free. Imports by most of the public sector and certain nonprofit entities, imports of an emergency or humanitarian nature, and goods for reexport are exempt from import duties; goods originating from the CARICOM area are also exempt. Some items are subject to revenue-replacement duties ranging from 5% to 25%. An environmental tax of 2% is levied on a broad range of imports. Specific duties and surcharges apply to certain products.
State import monopolyThe Belize Marketing Board has an import monopoly on rice, potatoes, onions, and carrots.
References to legal instruments and hyperlinksn.a.
Exports and Export Proceeds
Repatriation requirementsYes.
Surrender requirements
Surrender to the central bankThe CBB requires the direct surrender of sugar export proceeds.
Surrender to authorized dealersExport proceeds must be surrendered to ADs not later than six months after the date of shipment, unless otherwise directed by the CBB.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExport licenses are required for live animals, excluding pets; fish, crustaceans, and mollusks, excluding agricultural species; lumber and logs; beans; citrus fruits; and sugar.
Without quotasYes.
Export taxes
Other export taxesTransshipments are subject to a 1.5% customs administration fee.
References to legal instruments and hyperlinksn.a.
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Trade-related paymentsThere are controls on the payment of commissions.
Prior approvalFor the payment and transfer of commissions, approval is granted by the CBB, subject to clearance by the Commissioner of Income Tax (CIT).
Investment-related payments
Prior approvalPayments of interest are subject to CBB approval and clearance by the CIT and require a copy of the loan agreement, amortization schedule, and proof of the loan disbursement. For transfer of profits and dividends, an income statement and a declaration of dividends must be presented along with clearance by the CIT.
Payments for travel
Quantitative limitsThe following limits are in effect: (1) for nonbusiness travel by residents, up to the equivalent of BZ$6,000 a person a trip; (2) for business travel by residents, BZ$500 a person a day; (3) for medical travel, BZ$6,000 a person a trip; and (4) for business or nonbusiness travel by nonresidents, BZ$500 a person a year, unless payment is made from an external account or from proceeds of foreign currency. Resident travelers are required to sell their excess holdings of foreign currencies to an AD on returning to Belize. The CBB reserves the right to waive these limits.
Indicative limits/bona fide testYes.
Personal paymentsPayments related to medical costs are made directly to a doctor or hospital with original invoices or bills supporting the application.
Prior approvalFor the transfer of pensions and payments for family maintenance and alimony, CBB approval and CIT clearance are required.
Quantitative limitsThe limit for gifts is BZ$1,000 a person a year or its equivalent.
Indicative limits/bona fide testForeign exchange is provided by ADs for payment of correspondence courses when applications are properly documented.
Foreign workers’ wages
Prior approvalApproval for remittance of wages is granted by the CBB, subject to clearance by the CIT.
Other payments
Prior approvalFor the transfer of consulting and legal fees, approval is granted by the CBB, subject to clearance by the CIT.
Indicative limits/bona fide testSimilar requirements apply for subscriptions and membership fees for study abroad.
References to legal instruments and hyperlinksn.a.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirements
Surrender to authorized dealersProceeds must be sold to an AD.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a.
Capital Transactions
Controls on capital transactionsAll capital transfers require the approval of the CBB, but controls are administered liberally.
Repatriation requirementsn.a.
Surrender requirementsn.a.
Controls on capital and money market instrumentsControls apply to all these transactions.
Controls on derivatives and other instrumentsControls apply to all these transactions.
Controls on credit operations
Commercial creditsControls apply to all these transactions.
Financial credits
By residents to nonresidentsYes.
To residents from nonresidentsEPZ developers, EPZ businesses, CFZ developers, and CFZ businesses may obtain loans or advances up to US$1 million from offshore banks. Loans or advances in excess of this amount require written CBB approval.
Guarantees, sureties, and financial backup facilitiesControls apply to all these transactions.
Controls on direct investment
Outward direct investmentYes.
Inward direct investmentInward direct investment must be registered with the CBB if the profits are to be repatriated in the future.
Controls on liquidation of direct investmentRepatriation of proceeds requires clearance by the CIT.
Controls on real estate transactionsControls apply to all these transactions. There is a land speculation tax of 5% of the unimproved value of land holdings exceeding 300 acres.
Controls on personal capital transactions
LoansControls apply to all these transactions.
Gifts, endowments, inheritances, and legaciesControls apply to all these transactions.
Settlements of debts abroad by immigrantsYes.
Transfer of assetsControls apply to all these transactions.
Transfer of gambling and prize earningsThe repatriation of gambling proceeds by nonresidents requires clearance by the CIT.
References to legal instruments and hyperlinksn.a.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Borrowing abroadYes.
Maintenance of accounts abroadYes.
Lending to nonresidents (financial or commercial credits)Yes.
Lending locally in foreign exchangeYes.
Purchase of locally issued securities denominated in foreign exchangeYes.
Differential treatment of deposit accounts held by nonresidentsEffective January 16, 2006, nonresidents are required to use offshore banks.
Liquid asset requirementsThe liquid asset requirement is 20%.
Provisions specific to institutional investors
Pension fundsn.a.
Investment firms and collective investment fundsn.a.
References to legal instruments and hyperlinksn.a.
Changes during 2006
Exchange arrangementJanuary 1. The exchange rate structure was reclassified to unitary from dual due to technical correction in the classification.
Provisions specific to the financial sector
Provisions specific to commercial banks and other credit institutionsJanuary 16. Nonresidents were required to use offshore banks.

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