OVERCOMING STRUCTURAL BARRIERS TO GROWTH WITH EQUITY

IN SMALL DEVELOPING COUNTRIES LIKE BELIZE

An Address by the Rt. Hon. Said Musa at the Institute for Cultural Diplomacy, Berlin, Germany

June 20th 2012

1. The Challenges to Growth

Many of us were taught at school that during the Middle Ages there

was little or no economic improvement over some eight centuries. Then

came the Industrial Revolution when incomes consistently advanced at a

rate that was extraordinary by any former historical standard. We were then

told to draw the conclusion that technological advance was the origin of

economic growth and that it was in fact the central if not the sole cause of

the industrial revolution.

Since then some economists have argued that inventions in and of

themselves are not the sole or even leading source of prosperity.

Technological innovation is necessary to growth but it is as much a

consequence of economic opportunities as it is their cause. As the argument

goes, it is the growth of markets through trade, colonization and domestic

expansion that is the predominant factor in Western economic development.

The growth of markets was closely associated with the rapid flow and

dissemination of information which was typically a by-product of expanding

markets and innovation.

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The colonization of African, Caribbean, Latin American and Pacific

territories by Western powers provided significant sources of cheap raw

materials and basic commodities for the growing markets and factories in

the metropolitan centres of Europe. The mass extermination of indigenous

people and the inhumanity and abomination of the slave trade that

accompanied imperialism and colonialism stand out as dark clouds in the

evolutionary landscape of capitalism which re-appear ever so often in

modern times whenever man’s inhumanity to man rears its ugly head.

The poetic writings of Eduardo Galeano in his book: “Open Veins of

Latin America”, the seminal work of Dr. Eric Williams a former Prime Minister

of Trinidad and Tobago in his book: “From Columbus to Castro” and the

penetrating analysis of “How Europe Underdeveloped Africa” by the late

Guyanese Professor Walter Rodney provide powerful insights into this sordid

period of history.

But the expansion of markets through trade and colonization with the

spread of information, were not sufficient factors for sustainable growth and

development.

Our understanding of why countries and economies grew is because

they were able to attain basic thresholds in several key areas. These include

democratic governance, order, peace and political stability; literacy,

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educational attainment and health of the population; the distribution of

income-making assets, the availability of financial capital; the development

of legal institutions; the vitality of entrepreneurialism.

Most of these key areas are necessary conditions for sustainable

growth but no one of them is sufficient in itself. The abundance of natural

resources is certainly a blessing but as history shows it can also be a curse.

An equally important factor is the human instinct to improve one’s material

well-being. It has been said that the first human material motivation is to

acquire adequate food and shelter. The second seems to be security. The

third is apparently power and pleasure including recreation and other

aspects of enjoyment. The fourth is all the complex issues of status and

identity.

The instinct to improve oneself materially is necessary for growth. It is

at the fountain of the enterprising spirit which drives private enterprise. But

as Amartya Sen a Nobel Prize winner in Economics reminds us in his book

“Development as Freedom” it is important to dispute the common

description of Adam Smith – the father of modern economics – as the single-

minded prophet of self-interest. Smith did point out that the motivation for

mutually beneficial exchanges does not need more than what he called “self-

love”. But he also noted that in dealing with other economic issues like the

rules to be followed for generating productive efficiency, the virtues of

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“prudence, humanity, generosity and public spirit are the qualities most

useful.” The profit motive leads far too easily to individualism, selfishness

and greed. Furthermore one’s basic motivation for self-improvement has

often been undermined by despair, humiliation, poverty and tyranny.

2. Growth in GDP is not Enough

No budget speech by a Minister of Finance is ever complete without

mentioning the rate of growth of the gross domestic product (GDP) of the

nation. But G.D.P. by no means provides all the information about how well

off we are. When the GDP grows faster so do incomes on average generally.

It does not however measure the nation’s total wealth – its assets, such as

land, housing and stocks – as opposed to the annual volume of goods and

services made and provided. It does not account for the degradation of the

environment when a hurricane devastates the coast line of a small Caribbean

nation and destroys its physical infrastructure and the poorly constructed

homes of low income citizens. In fact reported G.D.P. usually increases

because more money is spent to rebuild damage high-end dwellings and

hotels. And G.D.P. does not tell us how the nation’s total income is

distributed among workers. Higher income workers usually get most of what

the nation produces as has been the case since the late 1970s.

The recent Occupy Wall Street Protest movement demonstrates a

widespread dissatisfaction with the growing economic inequality in our world

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today. This is not simply one of the divide between the rich and the poor

countries but also inequality among individuals and groups within societies

both rich and poor.

There are two general indicators of beneficial growth for an economy.

The first is the growth of the workforce. The second is the growth of

productivity or the output per hour of work of all workers. And it is only the

portion of growth due to gains in productivity that is available to raise the

nation’s living standard. Without productivity gains, any growth in GDP is

exactly offset by population growth and the average income stays the same.

For a small nation like Belize with a population of just 350,000 where 15 to

20 percent represent refugees and economic migrants, who sought refuge in

Belize fleeing the civil conflicts and social unrest in the eighties from

neighbouring El Salvador and Guatemala and other parts of Central America

this question of productivity is critical. Most of these migrants were poor

peasant families (the well to do ones were able to make their way to North

America). There is no doubt that these migrants once settled in their new

homeland were able to contribute significantly to the growth in agricultural

production for domestic food consumption. However their presence also

created serious additional burdens on the social infrastructure costs of the

nation (the need for new schools, health clinics, potable water systems,

electricity and land surveys, transportation and communication).

Historically, Belize has always been a place of refuge for persecuted and

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economically displaced persons in our region from the days of the Caste War

in Mexico in the middle of the 19th century to today’s economic migrants

from Central America. We have always prided ourselves for living in a

tranquil haven of democracy. But that too comes with serious challenges.

3. The Challenges to growth and shared prosperity

The 21st Century opened with an unprecedented declaration of

solidarity and determination to rid the world of poverty. In the year 2000,

the United Nations Millennium Declaration, adopted by the largest ever

gathering of heads of state and government, committed countries – rich and

poor – to doing all they can to eradicate poverty, promote human dignity and

equality and achieve peace, democracy and environmental sustainability.

The historical record showed that economic growth was a powerful

force for pulling poor people above the income poverty line, but that such

gains did not automatically happen. Furthermore, these gains can be

dissipated if income inequality widens and poor people do not share

adequately in growth – a phenomenon observed in many countries in recent

years. Over the past two decades income inequality worsened in 33 of 66

developing countries according to a UNDP report.

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Joseph Stiglitz the Nobel Laureate for Economics 2002 has written

challenging the received wisdom that there is a systematic relationship

between globalization and growth and between growth and poverty

reduction. He debunked what he called “long discredited trickledown

economics which hold that a rising tide lifts all boats.”

The policy issues, he contends, are not whether “to globalize or not to

globalize” or “to grow or not to grow”. In some cases it is not even to

“liberalize or not to liberalize”. Neither theory nor evidence, he says,

supports the view that opening markets to short term speculative capital

flows increases economic growth. Rather there is considerable evidence and

thought that it increases economic instability and that economic instability

contributes to insecurity and poverty. And even if growth increased slightly,

the form of it might increase poverty especially in countries without

adequate social safety nets. His conclusion which is irrefutable is that

globalization as it has been practiced is unfair and its benefits have

disproportionately gone to rich corporations and the wealthy elite. The

debate should be on how globalization can be shaped (including the rules of

the game) to better promote growth and reduce poverty in the developing

world.

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As Jeffrey Sachs tells us: “The defining challenge of the 21st century will

be to face the reality that humanity shares a common fate on a crowded

planet”.

4. A Rising Tide does not lift all Boats

We in the small developing countries are beginning to understand that

our own citizens share a common fate requiring the active role of

government to ensure that every citizen has a chance and means to

participate productively within the society and to curb society’s dangerous

encroachment on the physical environment. The market economy operates

in most if not all our countries but market forces left to themselves, the so-

called laissez-faire capitalism now fashionably called neo-liberalism, will not

deliver sustained and equitable economic growth without the guiding hand of

overarching principles of social justice and environmental stewardship.

Paul Collier a Professor of Economics at Oxford University whose study

was focused on African economies, speaks of the Bottom Billion. A group of

about 50 failing states caught in various poverty traps whose problems defy

traditional approaches to alleviating poverty. These poverty traps include

civil war and corrupt governance. Even in countries that may be rich in

natural resources like oil, this blessing often becomes a resource curse

resulting in deepening poverty and inequality. Cost of living skyrockets. The

government indulges in wasteful spending. The politics of patronage,

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cronyism and nepotism soon shatters the growth and development of the

nation.

What we can discern from all these studies is that poverty and growing

inequality is an outcome of more than economic policies. It is an outcome of

a failure of political will and capacity to address the human development of a

people through policies that promote economic growth with equity. It is an

outcome of the inability or powerlessness of a people to take charge of their

own lives, to demand and to pursue the social programmes and actions that

promote opportunity and enhance their security.

There is also the crucial and complex role that culture plays in this

process. David Landis in his book “The Wealth and Poverty of Nations”

contends that the key factor in explaining why some countries are able to

make the leap forward to development and others are not is the cultural

endowments of its people, particularly the values of hard work, thrift,

honesty and tenacity as well as the degree to which it is open to change and

new technology. The beliefs and practices that are part of local culture can

no doubt be a source of sustainable development. But too often customary

practices and discrimination on the basis of gender, ethnicity, race, religion,

social status or class are the root sources of pervasive inequality in many

countries.

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We have seen from history how racism in the United States and many

countries in Latin America have led to deeply divided and unequal societies.

The extreme poverty of the indigenous Maya and Ketchi people the majority

of the population in the Central American nation of Guatemala can only be

explained by decades of repression and social marginalization. Under a

latifundista system where most of the arable land was owned and controlled

by the wealthy and powerful, the vast majority of the people were left to eke

out a living as subsistence peasant farmers in poor rural communities lacking

even basic health and education facilities, potable water system or

electricity.

Meanwhile right next door in little Belize a major land reform

programme was initiated by the government of Premier George Price which

transformed the country and greatly reduced the inequality between rural

communities and urban residents.

5. The Human Development Approach

In 1990 a new approach was introduced to assess the development of

nations by putting the condition of people and their quality of life at centre

stage. UNDP Reports began measuring human development by national

income (GDP) but also by life expectancy and literacy. This new approach

was inspired by the creative passion of Muhbub Ul Haq and the ground

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breaking work of Amartya Sen, a Pakistani and Indian economist

respectively. The central contention of the human development approach is

that well-being is about much more than money. It is about the possibilities

that people have to fulfill the life plans they have, reason to choose and

pursue.

The human development approach emphasizes empowerment,

equality and sustainability in expanding people’s choices; people’s freedoms

and capabilities to lead lives that they value and have reason to value. We

are talking here about the freedoms to live long, healthy and creative lives to

advance other goals and to find fulfillment in doing so.

Both equity and sustainability are about distributive justice.

Inequalities are especially unjust when they systematically disadvantage

specific groups of people, whether because of gender, ethnicity or birthplace

or when the gap is so great that acute poverty is high. The current

generation destroying the environment for future generations is no different

from a present day group’s suppressing the aspirations of other groups for

equal opportunities to jobs, health or education.

Most people today live longer, are more educated and have more

access to goods and services than ever before. But income inequality has

deteriorated in many countries and regions.

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Over the last decade or so several Latin American countries have

bucked this trend – Argentina, Brazil, Mexico and Peru. Others in the

Caribbean and Central America have experienced growing inequality even

with a level of economic growth. Some trace Latin America’s performance to

the shrinking earnings gap between high and low-skilled workers and to the

increase in targeted social transfer payments.

Research carried out by UN and other international agencies indicate

no definitive causal effect between the 2008 financial crisis and the growing

inequality. A lot depends on the policy responses to a recession.

6. The case of small developing countries: Belize, the Caribbean and Central America

Most of the countries in this region with the exception of Haiti, are

considered Medium Human Development nations. Several – Barbados, Costa

Rica, the Bahamas, Cuba, Panama, Trinidad & Tobago are classified as High

Human Development (UNDP Human Development Report 2011). Yet, in

most if not all these developing countries there is persistent poverty, deep-

seated pockets of extreme poverty and gross income inequality.

Belize is a young nation. Political independence from Britain was

achieved only 30 years ago on 21st September 1981. Belize began life as an

independent country ranked 22nd in terms of GDP per head among the

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countries of the Caribbean indicating the long distance Belize needed to

travel. Independence did entitle Belize to certain preferential Trade

Agreements namely the Caribbean Basin Initiative (CBI) in 1984 that gave us

duty-free entry to the US on certain exports such as citrus. This preferential

treatment virtually disappeared with the coming of NAFTA between the US,

Mexico and Canada. The Lomé Convention defined the terms which exports

from the African-Caribbean-Pacific (ACP) countries could enter the European

Community.

The Lomé Convention has since gone through several changes – the

Cotinou Agreement and now the Economic Partnership Agreement (EPA).

These trading arrangements are important to small developing countries

who all need to become competitive in the products they export and

diversify into others. The fact remains that trade policies in the rich

industrialized countries remain highly discriminatory against the products of

the poor, especially the agriculture based, small developing countries.

Protection in most rich countries remains extremely high through a variety of

instruments.

Most rich countries apply higher tariffs to agricultural goods and simple

manufactures – the very goods that small developing countries produce and

can export. Import quotas are a more extreme version of the same policy.

Another way rich countries tilt the playing field for trade is by paying large

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subsidies to their domestic food producers. Belize’s and the Caribbean’s

agricultural exports of sugar, citrus, bananas, rice, sea-food (fish, lobster,

shrimp) are directly affected by such unequal terms and arrangements in

global trade regime.

Again in the field of technology, there have been dramatic advances in

medicine, agriculture, energy, information and communications technology

offering huge opportunities to put the power of technology to work for

development by raising productivity. Many rich countries however, despite

their commitment in the Trade-Related Aspects of Intellectual Property

Rights (TRIPS), have taken no real steps to share their technology.

In its entire post-independence period, the Belizean economy

measured by GDP at constant prices grew at nearly five percent per year.

Most of this growth, however, is explained by the increase in population, so

that the growth of GDP per head has been a more modest 2.2 percent still a

respectable performance and one that compares favourably over the same

period (1980-2010) both with Central America (0.8 percent) and the

Caribbean as a whole (1.7 percent).

A recent study done by Victor Bulmer Thomas and Barbara Bulmer

Thomas: “The Economic History of Belize” (from the 17th Century to Post

Independence) shows that the fluctuations in the growth of the Belizean

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economy since independence have several causes, the most volatile has

been investment both private and public.

In Belize, the government has been responsible on average for a high

share of this investment since independence (around 40%). Since high public

investment in boom years is normally financed by borrowing from abroad it

has led to a problem of external indebtedness with the central government

struggling to service the debt in slump years.

Historically the main driver of the Belizean economy has been forestry

(logwood and mahogany exports), then agricultural exports and since the

80’s, tourism and services. In 2006 oil was discovered (in modest quantities

5,000 barrels a day). Recently however the private investment climate has

been jolted by the government’s takeover of the main telecommunications

provider (BTL) and the national electricity company (BEL). Taking over these

private companies in the name of nationalizing Belizean public utilities

offered the government both immediate financial and political benefits:

Financial, because the profits accrue to the revenue base of public finances,

while the compensation due to the original foreign investors remains unpaid,

tied up in litigation; Political benefits because of its nationalistic stirrings in

the hearts and minds of the populace.

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The long term costs to the country may however be harder to

calculate. For there is no doubt that the “nationalization” has put a very

serious damper on the already dismal level of foreign investment in Belize.

The millions of dollars that will have to be paid as compensation is putting a

severe strain on this government’s ability to service its debt obligations. The

social sector (health services, education) is facing further cuts. Public

officers, teachers, nurses and police have had their wages frozen.

7. The Gap between the have and the have not

At the time of independence, the people of Belize were all relatively

poor; there was a lack of extremes between the rich and the poor.

Ostentatious wealth was not flaunted even by the few well-to-do merchants,

landlords and business people. Conspicuous consumption was virtually

absent.

Twenty years later, according to the 2002 Poverty Assessment Report,

one-third of all Belizeans were defined as poor despite the fact that the

economy had been growing in the previous years. The Poverty Assessment

Report in 2009 was even more shocking. The level of indigence (extreme

poverty where the individual’s income is insufficient even to buy the

minimum food requirements) had increased to 16 percent and poverty as a

whole had increased to 41.3 percent. The level of income inequality (the gini

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coefficient) had also increased. In the Caribbean only Haiti and the

Dominican Republic had higher levels of poverty.

The Report identified a lack of education and skills level as a major

factor contributing to growing poverty and inequality. Nearly 90 percent of

heads of indigent households particularly in rural communities left school

with only a primary school education. Secondary school attendance rates in

Belize are dismally low by international standards less than half of our

children complete a high school education. And for those who make it to

Sixth Form or to the fledgling National University, jobs are hard to come by.

The job market is very depressed. The unemployment rate is over 23% and

closer to 40% for young people between the ages of 15 to 30.

The depressed state of the economy and the dramatic fall in private

sector investment (local and foreign) with the resulting high unemployment

rate are no doubt significant factors leading to growing poverty and

inequality.

During the period 1998 to 2007 the country of Belize sustained

extensive damage and destruction to crops, infrastructure and housing stock

from a series of hurricanes, tropical storms and flooding. These natural

disasters and the costs of reconstruction put a severe strain on the financial

resources of Belize resulting in a major fiscal deficit and a significant

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increase in the foreign debt. Our government through a home-grown

adjustment programme of increased taxes and cuts in capital expenditure

was able to reduce the fiscal deficit from about 8% of GDP in 2004 to less

than 1% of GDP in 2008. The Government also successfully carried out a

debt restructuring of virtually 100% of its commercial foreign debt which

provides significant cash flow savings from reduction in interest rates and an

extended moratorium on the payment of the principal debt.

This tough austerity programme which the government carried out to

reduce the deficit to less than 1 percent, though fiscally successful, took its

toll politically when our government was trounced and voted out in the

elections of 2008. Deficit reduction was the right thing to do in order to

ensure that Belize can maintain economic sustainability but the pace of

implementation may have been too rapid resulting in much hardship

especially on the working poor and the middle-class.

A recent study on the debt-burdened Jamaica’s economy by the Center

for Economic and Policy Research a Washington based think-tank describes

this Caribbean country as having the highest percentage of debt-servicing

interest payment to gross domestic product anywhere in the world. For years

roughly half of the Jamaican government’s budget has been dedicated to

paying the debt which has forced the country to scrimp on schools, health

services and infrastructure. Despite several programmes with the

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International Monetary Fund (IMF) and debt restructuring, Jamaica’s debt is

still about 130% of the GDP.

There is no doubt that one of the debilitating structural problems of

most of the Caribbean economies is a high external public debt and the high

interest charged to service the debt. The high lending rates by Banks

undermine investment and make the return on capital needed by new firms

particularly the small and medium sized enterprises extremely challenging.

The argument then that development will be propelled by a focus on the

SMEs rings a little hollow without access to relatively inexpensive capital and

appropriate technology for such small and medium-sized firms to invest grow

and develop.

The unsung hero in Belize as well as many other developing countries

is the Credit Union Movement. Credit Unions promote savings “for a rainy

day” and provide loans to members for basic human needs as well as start-

up capital for your entrepreneurs. Profits are shared with members through

the payment of annual dividends. The Credit Union in Belize is called the

poor man’s bank.

But a most debilitating phenomenon is the rise in crime and violence. I

am ashamed to say that the once tranquil and quaint Belize City is today

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considered one of the most violent cities of the world (in per capita terms)

with 400 murders committed in the last four years. Drug trafficking, gangs

and the proliferation of firearms provide a lethal cocktail of violence.

Marijuana is the home-grown herbal drug of choice in the Caribbean and

Central America. But the region is also the transshipment area for the lethal

and lucrative cocaine trade which moves by air, land and sea from South

America to the demand market of North America and Europe. The problem

is compounded by the easy supply of guns from the United States whose

constitution affords its citizens the right to freely purchase and bear arms.

Today our neighbour to our immediate north – Mexico is terrorized by drug-

gangs like the Zetas whose penchant for mass killings and horrific massacres

of civilians has been described as the 21 century latest terrorism. There is a

growing awareness among regional leaders that the war on drugs is

unwinnable and the call for decriminalization at least for marijuana has

become more pronounced.

If human development is about expanding choice and advancing rights

then violent conflict is the most brutal suppression of human development.

The right to life and to security are among the most basic human rights.

Insecurity is both a cause and a consequence of mass poverty.

The cost of crime and violence falls disproportionately on poor and

marginalized people. Fears of violent conflict and random shootings disrupt

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everyday life and livelihoods. In addition to the direct loss of incomes and

investments there are costs with a bearing on human development.

Increased spending by the government on the security apparatus results in

less spending on social investment in education and health, thus

perpetuating growing poverty and income inequality. Women and children

are especially vulnerable and are the main victims who bear the brunt of the

human cost. Poor mothers ability to cover health costs, to keep their children

in school and maintain nutrition is diminished often times with fatal

consequences. Loss of opportunities for education is transmitted across

generations in the form of illiteracy and reduced prospects for escaping the

poverty trap. To assist and prevent this inexorable descent into violence,

deepening poverty and chaos, civil society and the population at large must

be challenged to cooperate with law enforcement agencies to root out

organized crime. Such an initiative must be based on a new approach that

promotes trust and confidence between the citizen and the police.

8. The Role of Civil Society

NGOs are no panacea to income inequality. But neither are

governments, nor markets. We need them all to become more focused, more

integrated, more ethically committed to a common purpose to create a

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better world, of greater opportunities and less divisiveness; a world of equal

justice for all, where cultural differences based on ethnicity, gender or

religion are celebrated in freedom where the economic and social walls of

exclusion and marginalization will be torn down like the Berlin Wall.

The Berlin Wall came down not because Mr. Reagan willed it so. But

because people – a freedom loving people hammered it down, brick by brick,

rock by rock, stone by stone. We have a saying in our part of the world, “Solo

el pueblo salva el pueblo!” Only the people can save the people. And then

there is this other profound notion: “No army can withstand the force of an

idea whose time has come”.

It is an undoubted fact that no agency has played as constructive a

role in the challenges of poverty, disease and the environment as the NGO

sector. The sector includes a wide array of institutions; philanthropic

foundations and individuals, activist groups, professional associations,

scientific organizations, religious groups, academia and many other grass-

roots organizations.

The successes of NGOs have been well documented and include

several Nobel Prize winners such as Muhammad Yunus whose institution –

Grameen Bank transformed the development of micro-financing in the

developing world; or Doctors Without Borders who pioneered the delivery of

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life-saving health care to some of the most impoverished regions of the

World.

Then there are the large Foundations now highlighted like the Bill and

Melinda Gates and Warren Buffett foundations. These foundations are

backed by billions of dollars contributed by such wealthy people and

corporations who have rightly focused their work on the elimination of

extreme poverty and disease. Others like the Google team, Larry Page and

Sergey Brin focus on the transformative power of information technology.

Local NGOs in our region who are dependent on grants from the

international NGO community tend to concentrate on environmental

concerns like pollution conservation of our forest, wild life and marine

resources and the dangers of off-shore oil exploration. There are also NGOs

involved with the important work of blindness prevention and treatment for

the visually impaired, other disabilities, HIV/AIDS awareness, cancer

treatment, family planning, and domestic violence. Faith-based groups are

also involved in “charity” work with the homeless, soup-kitchens and the

like.

In the eyes of the international NGO community, the Caribbean and

Central America, with the possible exception of poverty-stricken Haiti, we are

not on the radar screen except perhaps when we suffer a terrible disaster

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like hurricane Mitch which wrecked havoc on Honduras in 1998 resulting in

the deaths of thousands with thousands left homeless and destitute. Most of

our countries are simply not considered poor enough.

There is however hope in the growing awareness of the power of the

people mobilized in grass-roots organizations to bring about change through

collective action; expanding awareness for citizens to participate in decision-

making through democratic structures. Communications technology makes

possible linkages that were unimaginable just a few years ago. Social

networking tools such as the internet, Google and Facebook are becoming

crucial tools for cross-cultural contacts and group mobilization.

The information revolution has empowered civil society to serve as a

pressure on both governments and corporations to be more accountable and

transparent and to function with new forms of governance and less

corruption. Political reform and good governance matched with improved

delivery of basic services not only ensure that development projects are

more sustainable but also improve the chances of the poor and the

vulnerable to escape from the poverty trap.

SUMMING UP

To sum up, I leave you with the following thoughts.

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i) Economic growth and wealth creation in the nation are important

and necessary means to fight poverty and to provide a better

quality of life for all the people. We in the underdeveloped

countries need to get away from the old discourse of being ’for’

or ‘against’ growth. What is crucial is the expansion of people’s

real freedoms; rising income is important in facilitating the

expansion of freedoms and choices.

ii) There is no one model of development for all countries.

Pathways to advancing human development are varied and

specific to a country’s historical, political and institutional

conditions.

iii) Private sector investment, local and foreign, is crucial. I believe

strongly in promoting self-sufficiency in food production for the

domestic market. Export led production in the agro-industry

sector – sugar, citrus, bananas, rice, beans, papayas, lobster,

conch and livestock in which our small countries can compete

regionally if not globally, not only generate employment and

foreign exchange but also sustain livelihoods and economic

growth. Aquaculture – shrimp farms and tilapia fish farms,

successfully managed is also a major foreign exchange earner.

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In the services sector, the Tourist industry is a natural for our

Caribbean countries, well endowed with nature’s beauty, pristine

forest, wild life, marine resources, cave systems, coral reefs,

archaeological sites and artifacts. As a job-creator and income

generator, tourism offers tremendous opportunities for broad

based development in both stay-over arrivals and cruise-ship

tourism.

Income-generating assets must be sustainably managed and

marketed such as forest products for the furniture and wood-

carving industries. Also to be pursued are: financial services, call-

centres, sports, cultural and entertainment industries as well as

knowledge-based industries such as off-shore medical schools,

and language Training Centres. Our geographic location must be

utilized for its strategic trade value with exports processing

zones and free zones for the entre-pot trade between North and

South America.

Where there is an abundance of water, rivers must be harnessed

to produce hydro-electric power as we have successfully done in

Belize. Pursuing alternative sources of energy in an

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environmentally sound way including solar energy, can be very

cost effective for long-term economic growth and sustainability.

Today although domestic oil production is still relatively small, it

is the single largest export earner and government revenue

generator for Belize. This unexpected bonanza should be

targeted to uplift the standard of living especially for the

marginalized.

A meaningful social partnership between the state, the private

sector, labour and civil society is imperative. Foreign direct

investment (F.D.I.) that attracts fresh capital, the transfer of

technology and greater market access is critical to a successful

growth strategy.

iv) This economic growth may not however translate into equitable

growth unless there is democratic governance that practices

transparency and accountability by public officials and

institutions. The rule of law, open government, an independent

Judiciary, respect for human rights and fundamental freedoms

enshrined in the Supreme Law of the land – the Constitution,

must be upheld.

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Most people in our region live in democratic societies. They have

the chance to vote in periodic elections to choose their leaders.

The formal processes of democracy have proliferated at national

levels. But democracy does not guarantee freedom and justice

to all citizens.

For example, freedom of the press and freedom of information

may be proclaimed in the Constitution and in a Freedom of

Information Act. But the government has been better at rhetoric

than reality. “Sun/light” wrote Louis Brandeis, a US Supreme

Court Justice nearly a century ago, “is said to be the best

disinfectant.”

Again in the absence of effective campaign finance regulations,

free and fair elections can be subverted by massive vote-buying.

The Integrity in Public Life Legislation requiring all elected

officials to file an annual declaration of income, assets and

liabilities, must be strictly enforced. The posts of the Auditor

General and the Director of Public Prosecutions must be filled like

the Judiciary by persons of the highest integrity, free from

political interference.

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The public service in many of our countries work in difficult,

uncertain and under-resourced circumstances. Ministers and

other high officials are too often vested with excessive

discretionary power, a situation which provides a breeding

ground for corruption, abuse, patronage, nepotism and political

victimization. The poor, the weak and suspected supporters of

the opposition are the main victims in such a political culture of

not so much “what you know” but “who you know”.

v) The most powerful weapon to breaking down this wall of political,

social and economic injustice and discrimination is education.

Investment in education that provides universal access to quality

and relevant education is the key to poverty elimination. An

education that awakens the curiosity, the creativity of young

inquiring minds, that equips them with a positive attitude and

with skill and ability to function and contribute to the

development of their community, is the most effective strategy

for growth with equity.

We must take full advantage of the I.C.T. revolution in our

classrooms. Implementing the “one lap-top per student” at the

primary and secondary level is an investment we cannot afford

not to make even if we have to do it in phases.

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I find it very troubling that in my country Belize which in the past

was considered comparatively high on the Human Development

Index, by 2010 Belize was down to 78 out of 194 countries (still a

medium development country). One year later according to the

UNDP Index we had fallen to 93.

It is no coincidence in my view that less than half our children do

not even complete a secondary school education; and that the

programme for universal primary health care initiated by the

previous government has been severely cut back. It is absolutely

imperative for Belize to get back on track – on the pathway that

will secure to our children, young women and men the fulfillment

of their God-given talents and the means to participate

productively in society.

vi) An education that inspires young people to participate

productively in society must confront head-on the reality of the

present generation that seems totally obsessed with the culture

of materialism and instant gratification. It is a culture that

negates the value of hard work and sacrifice today for a better

tomorrow.

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It sees nothing wrong “in getting and having” no shame in

begging or stealing. Accepting responsibility for one’s actions

and the choices we make in life is no longer considered

important to character formation.

It is this growing culture of cynicism, dependence and lack of

responsibility that must change lest this quest for easy

contentment becomes the ultimate adversary of human freedom.

vii) The mind is a terrible thing to waste. So too is the body and the

spirit of a whole generation. A healthy population is essential for

people to live long productive lives.

The growing gap between the rich and the poor is dangerous in

countless ways. It is dangerous for the poor first whose lives are

cut short from undernourishment, diseases, lack of safe drinking

water, violence in their depressed, overcrowded homes and

neighbourhoods. Without reliable and affordable access to basic

health services, the poor who also happen to have the highest

fertility rates and the most rapid population growth rates is a

time-bomb ticking to explode. And even if my language here is

somewhat of a hyperbole, the fact remains that a country, a

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world, where some live in comfort and plenty, while close to half

the population lives in poverty and misery is neither just nor

stable.

A major factor in addressing persistent poverty is the provision of

universal primary health care services through a National Health

Insurance (NHI) programme subsidized through the Social

Security system to which all employers and employees

contribute. The emphasis is on primary and preventive care and

an aggressive public education campaign; early childhood

vaccinations, preventative measures against life-style diseases

such as diabetes, hypertension and HIV/AIDS. As a Director of

the Pan-American Health Organization once said: “the health of

the nation is the wealth of the nation”.

viii) Some problems are beyond the capacity of individual states,

particularly small states, to deal with effectively. We need

significant external resources to achieve critical levels of human

development. To increase the productivity of small farmers, to

improve basic infrastructure – ports, farm roads, power and

communication, broadband internet, to develop an industrial

development policy that nurtures entrepreneurial activity and

helps to diversify the economy away from dependence on

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primary commodity exports – all such policy responses to

structural constraints require a major overhaul of government’s

service delivery capacity and the nation’s development project

implementation capability. In this regard, bilateral and

international cooperation programmes are crucial.

ix) In addition there are certain global issues such as migration,

climate change and natural disaster relief which absolutely

require the attention and financial support of the international

community. In the case of Belize, the issue of migration is further

compounded by the degradation of our forest and nature

reserves carried out by daily illegal encroachments into our

territory by poor Guatemalan peasants and those who hire them

to cut down our timber resources and Xate plants–an ornamental

plant, which grows in the jungle of Belize and which has high

value in the European market. These illegal settlements and

encroachments pose not only an environmental hazard but also

a security threat because of the century-old Guatemalan claim to

Belizean territory.

x) The evidence of the devastating impacts on environmental

sustainability is compounded by global climate change. And in

the face of outrageous disparities in income and wealth our

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generation is called upon to meet this new challenge to human

freedom and well being.

In the final analysis I believe that it is not only in our enlightened self-

interest but as citizens living in a community to find the maximum outlet for

our creative energies and human potential, to understand the plight of the

poor, the dispossessed, the young people without hope and to share in the

responsibility of reshaping our world by doing all that we can to end the

exploitation of one human being by another. Our common humanity

demands this of us. The urgent demand of our generation is to reduce the

widening gap in income inequality and to break down the barriers to growth

with equity in our economic, social and political life.

For us in the small developing countries, whose forebears endured the

brutality and oppression of slavery and colonialism, who were inspired by the

Gandhian struggle of non-violence to defeat imperialism, its policies of divide

and rule and to confront the legacy of racism in our march to freedom and

independence, it is now incumbent on our generation to strive and to

overcome the challenge of poverty in the midst of plenty.

Ending extreme poverty and inequality is the moral imperative and the

great opportunity of our time. It is an undertaking that will relieve great

suffering and spread economic well-being, thus expanding the reach of

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human freedom. It will be a fulfillment of the sacred promise in our nation’s

Constitution wherein we the people affirmed that the nation of Belize shall be

founded upon principles which acknowledge…“the dignity of the human

person and the equal and inalienable rights with which all members of the

human family are endowed by their creator.”