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GOB Subsidizes Low Interest Loans For Tourism Sector
posted (July 29, 2020)
The Prime Minister today held a virtual press conference to announce 10 million dollars in (relatively) low interest financing for tourism stakeholders. It's a special line of credit which will be administered by the Development Finance Corporation. Special because of the low interest rate of 6% - but even more special because government is subsidising 1% of the interest - to the tune of 100 thousand dollars.

That's to make the credit as cheap as possible to this vital industry that has been flatlined by the COVID - 19 pandemic.

And what also makes it special is that the loans can be used for working capital - meaning to pay regular overhead expenses. The General Manager of the DFC explained what the funds can be used for, and who is eligible:

Natalie Goff, General Manager, DFC
"What is working capital? working capital are funds that you use for things like salaries, maintenance, in this era of Covid - health and safety standards - anything that's a recurring expense and who will be eligible for this programme? Belizean nationals, residents or non-nationals or any locally registered entity with no less than fifty-one percent Belizean ownership; however, considering that in the tourism sector we do have non-nationals who are employing Belizeans and generating foreign exchange for the country, those will also be considered on a case by case basis. The credit will be made directly to the tourism sector and all businesses, not only hoteliers, but they must have been operational prior to COVID. The whole purpose of the program is to maintain economic activity and aid in recovery. Business will be required to retain a minimum of 30% of their workforce. We would prefer a higher amount, but at least 30% depending on the scale of the business and the type of operations. The maximum loan size this time we are looking at is one million dollars. If we have too many of those, the money will go. So those will be minimal, but that will be the absolute maximum loan size. The loan payment will be determine based on the projected cash flow. However, we are at this time giving a maximum of 5 years including a one year grace period on payment of principal and interest. We are living in lean times and everybody have to run a lean operation and these loans will be monitored to ensure that 1) we have to ensure recovery. We don't want a situation where we end up 5 years from now and we have 10 million dollars that is not repaid to the organization."

Only loans of above one hundred thousand dollars will require property as collateral.

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