PM Barrow Breaks down Petrocaribe

Dean Barrow

Seventy-two million dollars of the one hundred and forty-one million dollar deficit was financed through draw-downs from Petrocaribe monies. According to the Prime Minister, for the eighth consecutive year there has been no commercial borrowing. He points out that as a consequence of G.O.B.’s debt strategy, coupled with their fiscal strategy, the core numbers are absolutely sustainable. A gem in government’s debt strategy has been the inflow of Petrocaribe monies, and it is one which the PM says he intends to use for as long as it lasts.

Prime Minister Dean Barrow

“Under the terms of the Agreement, which provides for long term financing of a greater or smaller proportion of the cost of these imports depending on the world market prices, the Government of Belize has borrowed from APBEL a total of US one hundred and forty-three million dollars during this same period. The main terms and conditions under which these funds were borrowed included a Rate of Interest of one percent per annum and a Repayment Term of twenty-five years inclusive of a two-year Grace Period. During this grace period the interest itself is capitalized. Because this Grace Period is still in effect, the G.O.B. has not so far had to make any debt payments (neither principal nor interest on these loans). But, commencing this year, interest and repayment will begin to fall due. To provide for such payments, there is an allocation of four million dollars in the budget. Of the two hundred and eighty-six million borrowed under the Agreement, the G.O.B. has drawn down some one hundred and twenty-six million to finance various capital programs over two fiscal years, leaving a current balance of one hundred and sixty million dollars in a special account in the Central Bank. These fluctuating balances have been used to bolster our official foreign reserves to a historically high level of nine hundred and seventy-four million at end 2014. The one hundred and twenty-six million dollars drawn down has been used to finance the following projects and programs over the two fiscal years: Equity in the National Bank of Belize, thirty million dollars; Upgrading and Rehabilitation of Streets in the District Towns, twenty-five point four million dollars; Upgrading and Rehabilitation of Streets in Belize City, fifteen million; New Infrastructure (Lake I Boulevard and Landfill and Chetumal Street Bridge) in Belize City, eleven million; Social Support and Community Assistance, thirteen million; Purchase of Property and Equipment, seven point one million; Sporting Facilities, five million; Maintenance of Main Roads and Highways, four point seven million and Counterpart Expenditure to other Capital Projects, fourteen point eight million.”