Ministry (Minister of National Development, Investment & Culture)

Mark Espat ran his first election for the People’s United Party (P.U.P), which is the government of the day in 1998. He was re-elected for a second term in 2003 by the voters in his constituency.

Currently his portfolio is the Ministry of National Development which is economic development with responsibility for investment and culture. He has also worked in the areas of youth and tourism and various other areas over the last 8 years.

Q-What are Belize’s features in tourism?

A-Belize stands out both in the Caribbean & Central America as a different type of destination. We have a relatively small industry about 5,500 hotel rooms in total even though it’s limited in capacity we have excellent connections to the biggest tourism market in the world which is the United States of America. We now have connections from Newark, New Jersey, from Charlotte from Miami, Dallas from Atlanta also we have excellent connections and it shows in our arrival figures where almost 4 out of 5 tourists come from the U.S.A.

I think we will continue to distinguish ourselves as a niche market specifically in the soft adventure and ecotourism markets. I think the prospects for the medium and long term is bright for Belize. We have been averaging growth of between 8 & 10% for the last 8 years and I think it will continue in the entire Western hemisphere.

It’s only Belize and Turks and Caicos that have had yearly growth every year for the last 8 years and with the improvements to the Philip Goldson International Airport that are underway I think we will be able to attract long-haul aircraft from Europe and South America and so I have a very optimistic view for the future for tourism.

Q-What are you expecting for this year?

A-Well I think our government is expecting that the economy will continue to grow.

The forecast that we have agreed to along with our international partners is somewhere between 2.5 and 3.5% we will continue to keep unemployment relatively low, between 10 and 11%, inflation has remained in check even though as you know the price of oil has been sky rocketing. So we expect the economy to remain strong and that includes tourism, citrus and bananas, shrimp, non traditional products like papaya, there is a transition under way now in the sugar industry and in the non productive sector. The financial sector and the IT sector. So we’re expecting stable growth, 2.5-3.5%.

Q-What will happen in tourism?

A- I think the airport is a prerequisite for any significant growth simply because of capacity. The project should be finished by the end of this year. It’s a U.S. $21million expansion of the runway, the terminal facilities, the cargo facilities and we feel that is the precursor to an increase in arrivals, the new arrivals. In terms of hotel development it will come. Not in the form of a 20 or 30% increase, it will continue to be incremental, which I think is the best way so as to have the benefits spread to as many people as possible.

Q-I guess it would have to come with big hotels like in Cancun, so how would that work?

A-Well I’d defer that question to the Minister of Tourism but there’s a very concise National Tourism Plan and we’ve been working with it but we also depend on the the exchange of expertise from our members of various tourism related agencies, e.g. as a member of CARICOM, we’re also a member of the Central American Integration Movement (CISA) and other´s support from the private sector. I don´t think any tourism industry will develop in isolation, we have to remain engaged and be prepared to impor when necessary.

Q-Which is better the GST or the Sales Tax?

A- The majority of countries in the world has some kind of Value Added Tax and the General Sales Tax is a Value Added Tax. We’ve had almost 7years experience with the Sales Tax and it has worked well however in order to broaden the base of our tax system and in order to attract the diverse sustainable revenue that we need I think the GST is the best tax to move forward. I understand the consternation of the private sector and it’s always such anxiety when a major change takes place in the tax system. I hope with this system it will be for the long term so that if we should have a new mandate by whichever government in 2008 we may alter the conditions of the tax, the rate perhaps, but that we would stick with the system as I think it is the most sustainable system.
The challenge Belize has is the under population of our country. We have 9,000 square miles and less than 300,000 people and of those perhaps 1 in 3 is paying taxes so while the tax to GDP ratio is high around 22% the actual expenditure per person has to be very high. For e.g., the Southern Highway, a project both governments have been working on for about 10 years now it will cost about $120 M for some 90 odd miles from Stann-Creek to Toledo yet the Toledo District has a population of about 30-35,000 people so when you look at the cost per capita it’s extremely high. There’s no doubt we need to improve the network of roads.

Q-What will happen now that Belize has struck oil, because there´s going to be a need for a bigger oil related industry?

A-The challenge for the Government is three- fold, first to ensure the contracts are fair, that they provide a decent return on investment for the company but that they also provide a reasonable return to the Belizeans who are the ultimate owners of the petroleum industry. Secondly, the revenue that goes to the government must be placed in a transparent, long-term development fund that will fund poverty alleviation, education, health and other important initiatives that will improve the quality of life of Belize. Thirdly we have to find a mechanism by which the ordinary Belizeans can have ownership of the dividends, so as to ensure that as much of that as possible can remain in our economy.

Q-Will the price of fuel go down in Belize?

A- Un-related to the discovery of oil there’s a heavy tax on every gallon of fuel and government at some point if the price keeps going up will have to look at the cost benefit of reducing it so as to stir industry and keep inflation in check. Also we have to look the cost benefit of refining it , depending on what the energy policy will be which we are developing right now for the long term.

Q- President Chavez gave US $25M a few weeks ago to cover the debt, does it have anything to do with the new found petrol?

A-No, that was a bi-lateral loan.

Q-Tell me about the retirement plans in Belize.

A- Yes we have a retired incentive program which is handled through the Belize Tourism Board . It has had some success in attracting retirees to Belize, since they receive the equivalent of a residence card and they have certain tax benefits that are attached to that status. It’s an important program, one I think that has great potential.

Q-What is your biggest success as Minister of National Development?

A-I think at the end of the day a politician’s success is measured by whatever improvements he or she is able to make for the country, for the quality of life for the people they serve or they should serve. Specifically for the Ministry of National Development we have been working very closely with the British government in debt relief, with our international financial partners like the IMF, IDB and the World Bank to stabilize Belize’s long-term debt.

To ensure there are sustainable programs in place from a revenue collections standpoint as well as expenditure and budget process standpoint and we have been at the forefront of many of the reforms of the last year and a half in Belize s now our greatest satisfaction is in setting up systems that we know will serve this and future government specifically in the areas of accountability, the budget and debt programs.

I think the biggest challenge right now is that we have a young population and it’s how to balance our priorities, investing in people, in infrastructure and as the population ages and becomes more productive hopefully that pressure will be reduced.

Q- So that international investor can have an idea, where are the investment opportunities?

A-Well I would tell them why they should invest in Belize. We have an independent court system, the rule of law is respected a stable tax environment, strong dollar and a relatively educated population and we have political stability. As to the areas for investment, well any of our major sector offers great returns-whether it’s tourism, banking, citrus-we now have an energy generation project with the sugar company, so for a serious investor these are the areas.

Q-Do you think the Belizean economy is so strong for the dollar to be pegged at 2 to 1?

A-Even the int’l financial experts agree if your country is a net importer then a fixed exchange rate is the best framework in the case of Belize it suits that a floating exchange rate or devaluation will not improve the economic fundamentals, it would make it measurably worse so I support a fixed exchange rate.

Q-Why are the cruise ships not staying overnight and what do you think can and should be done bout it? Is Belize City attractive enough for the tourist or should it maybe be improved?

A- In terms of the cruise ships they’re not looking at what’s best for Belize they’re looking at their bottom line. In terms of the attractiveness of Belize City I agree with you they’re more that could be done.

Q- Could you tell us about the rich Belizean culture?

A-Almost three years ago we put together the National Institute of Culture and History (NICH) and we opened the Bliss-Centre for the Performing Arts and there’s a lot more that will be done. So yes we have a unique blend of cultures and we have a full program leading up to our 25th Anniversary of Independence.

Q-Do you have a training program for tourism and services?

A-We don’t have a hotel school but we do have ongoing training program at every level of hotel management and the service sector in all the districts. The tourism board will be able to tell you more.

Q- What will happen with the next election? Does the PUP expect to win?

A-Of course our party is expected to win and I’m running in the next election.