Musa defends loan guarantee; Espat lambastes it
Tonight there still remain more questions than answers in the case of the controversial government guarantee of thirty-three million dollars in private debt contracted by Universal Health Services. At Monday’s press conference by the United Democratic Party, Opposition Leader Dean Barrow stoked the flames of public indignation by suggesting that the unlimited guarantee may have been manufactured after the fact and, even if it was not, the deal was still hidden from the public, the Cabinet, and the creditors that participated in this year’s restructuring of the government’s external debt. Interviewed by telephone this morning, Prime Minister Said Musa held his ground, telling News Five that the U.D.P. is simply trying to make a mystery out of what was a straightforward business transaction. According to the P.M., the international creditors would not have been informed about the U.H.S. guarantee because the restructuring dealt with foreign commercial debt, not domestic contingent liabilities. And while he admitted the guarantee was not listed in the budget, he maintained that many contingent liabilities are omitted from that document. “We were simply formalizing a guarantee given by the D.F.C.,” said Musa, “And there is no question that [the guarantee of December ninth 2004] is authentic.” When asked about Barrow’s allegation that the government did not have the authority to give such a commitment, Musa asserted that at the time he signed the guarantee, there was no requirement for the loan to be taken before the National Assembly for approval as the reforms initiated by the Public Finance and Audit Act did not take effect until the following year. He added that at a meeting of the Public Finance Committee on Monday evening, members have agreed that in order to avoid further speculation, they will be releasing the loan document to the public through the press office tomorrow.
But while the Prime Minister was trying to spread oil on rough waters, one member of his Cabinet was lighting a match. According to Minister of National Development Mark Espat–who was also the point man on the recent debt restructuring–at the time of the signing of the guarantee in early December 2004, there was no discussion of the issue in Cabinet. He told News Five that at that time he was not aware of any loan guarantee for U.H.S. and if he had known, he would have opposed it. Espat added that he believes there should now be a legal review of the guarantee document to see if it is in fact enforceable by the Belize Bank. He is also calling for a financial audit of U.H.S. to see exactly where all those millions of dollars in loan funds were spent.
