Belize Calms Down After Telecoms Riots

by Mike Godfrey, Tax-News.com, Washington

03 May 2005

Conditions in Belize seemed to be returning to normal last week after a two-week period in which the country found itself gripped by a spate of rioting, looting, violence and vandalism. The American Embassy in Belize has issued a statement saying there was no need for Americans to defer travel to Belize.

During a complex international dispute over ownership of national telecommunications company BTL, workers went on strike and sabotaged phone lines, cutting the country off from the rest of the world. The opposition United Democratic Party called for civil disobedience, stirring up a hornet’s nest of discontent amongst a populace already angry over plans to raise tax in order to pay down the country’s mounting levels of debt.

In February, the Belizean government seized back control of BTL from US-based firm Innovative Communications Company, which had been invited by the government to take over BTL and modernize Belize's telecommunications.

ICC claims to have invested more than US$60 million in BTL, whilst a further US$15 million has already been spent on improving telecommunications services throughout the country. The Government however claims that ICC has failed to pay more then US$57m due to it under the sale agreement.

After failing to obey a March 11 ruling by a US District Court ordering Belize to restore control of BTL to ICC, the government of Prime Minister Said Musa was on March 31 found in contempt of court and fined US$50,000 a day. Fines owing now total more than US$1 million dollars.

The crisis has led to demands from BTL's workers, the teachers union, university students, the National Trade Union Congress of Belize and the United Democratic Party, the opposition party, for Musa’s resignation, alongside that of his government.

According to former special counsel to President Clinton, Lanny Davis, counsel for ICC and currently partner of Orrick, Herrington and Sutcliffe, LLP, the crisis has only served to tarnish the reputation of Belize for foreign investors, especially in the US. "The lawless acts of the Belize Government as found by the US court in Miami send a message to all US companies -- beware before you invest in Belize unless the Belize government is prepared to follow the rule of law."

The Bureau of the Conference of Heads of Government of the Caribbean Community has expressed its "deep concern" over the situation in Belize, which is a member state of the CARICOM group of nations.

"The Bureau is alarmed at the reports of violence, looting and deliberate acts of sabotage, which have affected the personal security of the people of Belize and have had a negative impact on its economy," said a CARICOM statement.
It continued: "The Bureau wishes to call on all Belizeans at this time, to respect the rule of law, to abide by the Constitution of Belize and to engage in a process of dialogue in order to resolve in the national interest, such outstanding issues as confront the nation.

"The Bureau also reminds all Belizeans of the need to adhere to the principles enshrined in the Charter of Civil Society of the Caribbean Community and in the Inter-American Democratic Charter, both of which endorse their right to the free expression of their political beliefs, in a peaceful manner. The Bureau, on behalf of the entire Community, will continue to follow closely developments in Belize, and stands ready to assist the people of Belize at this time."

Prime Minister Said Musa spoke to the nation on April 22, essentially blaming the riots on his political opposition. He said that the democratic traditions of Belize would be followed, but that irresponsible violations of the law would not be allowed to continue. Musa's PUP government has been under increasing pressure since late January in the face of large budget defiicts, a dramatically increasing national debt, charges of corruption and fiscal mismanagement, and a downgrade of the country's credit rating by Standard & Poor's.

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