DOMESTIC POLITICS: The ruling UDP, led by Mr Barrow, has a decisive majority in the National Assembly and is not expected to have difficulty enacting its legislative agenda during its term in office, scheduled to run until 2013. The government will struggle to meet the public's high expectations for improved public services and living standards. The high level of public-sector debt will curtail its ability to boost economic growth through fiscal stimulus measures. There is strong public support for the fight to re-establish proper and transparent management of the public finances after years of allegations of corruption and mismanagement under previous governments. Measures to address Belize's heavy debt burden--and reduce its dependency on borrowing--are unlikely to make progress during 2009-10 as policy emphasis will remain on protecting the overall level of fiscal revenue, rather than on implementing unpopular expenditure cuts. Regionally, as governments attempt to deal with severe fiscal constraints amid rising levels of public debt, inequality and poverty levels will rise, reversing much of the progress made in the past decade. We do not expect rising discontent to threaten the region's long democratic tradition; most of the region's governments are expected to serve out their full parliamentary terms with several others opting for early elections to consolidate their parliamentary positions. The eight members of the Organisation of Eastern Caribbean States (OECS) will continue to enjoy broad political stability in 2009-10.

Source: Belize: Country outlook