P.M. sends Superbond team to negotiate
The Prime Minister addressed the nation via a press conference today looking for support in the re-structuring of the five hundred and forty-four million US dollar super bond. On Monday government missed a coupon payment of twenty three million dollars which caused a quick downgrade by Standard and Poor’s. While the Prime Minister says there is no money to meet debt obligations, he is banking on the success of negotiations to ward off a default or an IMF standby arrangement. In the July budget presentation, the PM said he had allocated ninety-three million dollars for payment, today he admitted that he has no source of funding. And while insisting that Belize is not at the point of default, he said it is prepared to deal with any consequences if negotiations with creditors are not successful. Notably, there have also not been face to face meetings with bondholders who have already rejected three restructuring proposals advanced last week and today the debt review team headed to Washington to meet with the I.M.F. and I.D.B. News Five’s Jose Sanchez has a report on today’s press conference.
Jose Sanchez, Reporting
On Tuesday August twentieth the government announced it was unable to make the step up interest payment, twenty-three million U.S. dollars for the Superbond. The Prime Minister followed up that comment with a press conference this morning in Belize City. Dean Barrow was flanked by Minister Godwin Hulse, Financial Secretary Joe Weight, and Governor of Central Bank Glenn Ysaguirre and debt review team leader, Mark Espat.
Dean Barrow
Dean Barrow
“It is nothing short of a small miracle that this U.D.P. administration proceeded to fulfill every debt obligation after it took office; including paying almost three hundred million dollars in interest on the Superbond. But the price we had to pay, sacrifices we had to make to meet fiscal and debt targets became increasingly unendurable. Earlier this year, we recognized that despite our unrivaled fiscal discipline, the level of public debt had remained too stubbornly elevated. This was contributed to by the step-up Superbond interest rate; and was in combination with the protracted nature of global contraction, the decline in our oil production and revenues, and the unavoidable intervention in the public utilities sector that led to the acquisition of B.T.L. and B.E.L.”
Though the P.M. in his budget speech said the payment was budgeted; he said today that the source of funding was not identified at the time.
Dean Barrow
“We made it clear at the time of the presentation of the budget that the government had not yet identified the source of funding for various items, but in particular, the August payment on the Superbond. And I personally intimated in the speech to parliament that the payment, certainly all of it, was not a sure thing. Paying the payment at all or at the very least paying all of the payment, was not a sure thing. I brought a copy of the budget speech so that I can point the media to the actual quotation. In the end, as it turned out and as might have been surmised by those that had listened to what I was saying or that I had said, no source of funding for the August payment did in fact materialize. We, therefore on Monday, could not pay. And that will remain the case unless we get the relief that can affect the dynamics and in fact impact our ability to pay.”
During the presentation, the members of the debt review team Financial Secretary Joe Waight and Lead negotiator Mark Espat left to take a flight to Washington.
Dean Barrow
“As I said, the members of the debt team are going to Washington. We wish them well, safe flight and strong backbones. Could we just have a break so that they might leave and then I can proceed to answer your questions.”
The international coverage of the bond included Reuters as well as Bloomberg News’ Bill Faries who asked about possible lawsuits from bondholders.
Bill Faries
Bill Faries, Bloomberg
“Can the government of Belize afford to stay out of international credit markets and face lawsuits if there is a full default and if no agreement is reached during this grace period?”
Dean Barrow
“The answer to your question is that we can, but it is not a prospect that we likely contemplate—it is not a prospect that we contemplate at all and merely for the reason that we are certain that can reach an agreement with the creditors. It is our sense following the comments of the principals on an almost daily basis; that there is a clear recognition on the part of the creditors that debt relief for Belize is a sure thing; unavoidable and is going to happen. So we are in fact, in my view, only talking about degree. The last comment that I saw from Mr. A.J. Mediratta—who seems to be a mover and shaker so far as the creditor committee is concerned—seems to go as far as to concede that the debt relief must contain an element of principal reduction and perhaps I’m teasing a little more out of his remarks than the bare language might sustain. But the creditors are sophisticated people; they are experienced investors; they know how scenarios change with respect to this whole field of sovereign debt and they, I believe, at bottom perfectly understand the case for Belize. So we make clear that we are not at all at a point where there is any contemplation of any possibility that the negotiations will not proceed. And we make clear once again that we are absolutely confident of success; we are absolutely confident that we can reach an agreed solution with our creditors. But I did answer you candidly that if god forbids that does not happen; Belize is prepared for all options.”
Recently three restructured scenarios were posted on the Central Bank of Belize’s website. They were rejected by bondholders. However, the P.M. pointed out that they are merely alternative approaches to seek relief which are not final.
Dean Barrow
“We are confident that our Indicative Scenarios would achieve the objective of closing the financing gaps that we identified as far back as June. But, of course, we acknowledge that there may be alternative structures; there may be alternative approaches that could achieve similar ends. Consequently, we are prepared to consider and discuss any proposal that creditors; that the bondholders; may wish to put on the table. However, I am obliged to underscore that the Government of Belize will only accept a resolution that fully reflects the country’s capacity to pay.”
Reporting for News Five, Jose Sanchez.
The reaction to the prime minister’s press conference has been fast and furious. Reuters reports that Belize is seen as more than twice as risky as Argentina and Pakistan as an investment destination.
What Barrow is saying that Belize can afford to stay out of the international credit market and face lawsuits if the country defaults is absolutely absurd. Either Barrow didn’t understand the question or he is devoid of all understanding of international economic and financial applications and treaties. ( This is outstanding coming from a lawyer. Perhaps he doesn’t have this kind of exposure.) Just so Belizeans are kept informed, under the current global capital flow system, it is imperative if not impossible, for any country to stay out of the international credit market and be subjected to applicable financial treaties transcending all political borders. The problem will be solved by the bondholders and not by the super hero negotiators flying off to Washington in an histrionic manner. Such silliness! Like I said before, either Belize accede to bondholders or go to IMF and its strictures and oversight regime. But the issue will be resolved one way or the other. But Barrow is a liar who doesn’t understand what is being asked, or he still lives in the fake inner sanctorum of the Socialism Norman Manley School of Law in Jamaica. Wake up Barrow, this is reality.
What a bafoon this pm is not only incompetent and impotent but he is a real bafoon in other words he is a big joke for Belize and the rest of the world now he is a big lier .if y Neva spend all tha money pa y wife and hotel tha Miami beach maybe we could have paid this super bond . Worse pm and gov. In the history of this great nation. Out with barrow ism out with barrow ism.
The Grand Theif Mr. Dean Barrow has sent his loser team to beg for some time , so they can steal more money from tax payers and send it to the loser Dean Barrow personal account in the USA.
Does sombody know the price of the superbond ? It must be cheap!
Belizeans must understand that we are at a critical financial juncture if we want to prevent True Austerity where there are NO JOBS and NO MONEY.
If you research the history and writings of the IMF, you will be surprised to realize that these Loans, with every increasing interest rates and coupon payments were meant to captivate and enslave us into debt servitude. The banking cartel’s modus operandi is to bribe corrupt politicians to accept the loans which will be paid for by later generations with blood and tears.
Be Sure, that the Superbond cannot be repaid and so the GOB is doing what is right for Belize to keep our money at home and not comply with debt obligations that the Musa Administration is responsible for.
1. Would you rather give away all your money to the corrupt globalist banking cartel and still be forced into default a year or 2 from now?
2 Or should we renegotiate to give Belize better terms so that we can manage at home and survive this economic depression?
3. Do the bankers (ex. Citibank) need any more money? They have the ability to create money from thin air. They don’t need Belize’s US $23 million. What they want is power and control of our sovereign nation. The debt is a means to an end. and that end is “global government”.
Everyone should research UN Agenda 21 to fully understand the complex plan at work.
The real hero here is Mark Espat. He has crossed party lines to bring about positive change for the benefit and future of Belize. It appears he has realized the mistakes of the Musa Administration and has a desire to do something about it. We should all be standing squarely behing Mark and the Negotiating Team. What they are doing will ensure better conditions here in Belize!
Yawn. This is getting to be boring. I love evil, and Dean Barrow is playing his cards to the max. He is an evil genius, and I like that.
Now sheeple, do not confuse what I said. I said I admire evil because it has a certain amount of creativity and goodness about it. It does not mean I like or support Barrow.
Barrow knows that the Belizean public are like sheep. We bleat and bleat. So guess what? It is just a matter of time before Barrow offer bond holders 30 percent to 50 percent of the bonds’ face value as payment in full.
Restructuring baby. Restructuring.
WTF!!! Belizeans have no money… this is what this government have carried us to… hope he gets that money of WE BELIZEANS are going to pay the consequences…
I’m very concerned that the Hon.PM might injure himself, patting himself on the back so vigorously about his “small miracle.”
He repeatedly said the coupon payment was budgeted, and that has been proved to be a lie he made to the nation, to the entire world.
I cannot imagine ever taking seriously anything he tells us, since he looked us in the eye and lied on so major a thing.
Lying and deceit may be an accepted strategy in his legal profession, but never in the head of state.
We need help from London to find our missing treasury.
Belizeans must realize that we are at a critical financial juncture for our country and our survival. We must do what is best for our country in order to avoid True Austerity where there is NO JOBS and NO MONEY.
When you study the history and writings of the IMF and World Bank, you will see a pattern and a strategy of bribing corrupt politicians to accept these loans that can never be repaid. Future generations will suffer and the true plan is to use these loans and the certain default to control and destabilize entire countries.
1. Should we give away all our money to pay the Super Bond and still be forced into default in 1-2 years time?
2. Or should we keep our money at home, ensuring the survival of our people?
The bankers (ex. Citibank) don’t need our money. Remember, they can print money out of thin air. What they want is power, control, and “Global Government”! These loans are only a means to an end. Power is their ultimate desire, not money.
Everyone should research UN Agenda 21 to fully understand the complex plan at work.
The real hero here is Mark Espat, who has crossed party lines to do what is right for Belize. It appears he has realized the mistakes of the Musa Administration and cares enough to do something about it. We should all be standing squarely behind Mark and the Negotiating Team for the efforts to be pro-active and advert total and complete chaos. (look at Greece)
This is definately the right course of action.
Excellent points LoveJoys but it is useless to try to enlighten people in this forum because no matter what you say they wont agree because it is the UDP this is doing it!
It was so funny to me that francis would have the nerve to even ask to be consulted in relation to the superbond to put that in prespective that is like someone stealing your money and helping you to look for it and pretending they had nothing to do with it – lol
pup have nerves of steel mein lol
The PM seems detached from reality during this entire press conference. I am seriously concerned about his mental state and whether he is medicated. Maybe some media house can engage a psychiatrist or psychologist to watch him here, and see if any insight can be gained about whether he is suffering any problem that affects his ability to reason. As our leader, his health is our legitimate concern.
You all had the option of changing course on election day and didn’t as a result keep going down the cliff until the Belizean Dollar is devalue.
Unu deserve whey unu aw get end of story.
Between a Rock and a Hard Place…
The Rock, PUP, got us into this mess, Oh how I remember the the Rolling 2000’s when Fonseca, Musa & Glenn Godfrey went on a borrowing spree and a stealing spree all at the same time. Housing developments that never materialized, Hospital service that never materialized, pipe dreams at every turn… The Hard Place, UDP, has a couple smart guys but not enough, a lot of duncey guys running things…
d pm d tak wa lot a fool. he wa mek we money devalue why he no pay di money he cud pay fi he wife go da states every minute
both parties are proven to be incompetent, in my humble opinion. so all this back and forth about colors is rediculous. someone say something smart about how to get out of this mess.. You all say the same $#!% all day, everyday.
But I recall our PM gave away Christmas baskets from Bottom Dollar and said the government is flushed with cash, that was a mere 8 months ago.
Well lets see what are the results of the negotiating team’s efforts. However, remember February 2012 another payment will be due as well. Now what will the PM do to ensure that this embarassing situation for Belize does not happen again in the future? The world is watching us closely and if the negotiations fail lets see what alternatives exist for Belize to service its debts. Belize will get more than a “black-eye” in the region, western hemisphere, and the world.
If negotiations do succeed what will happen from now to Feb 2012 and how GOB can better the lives of every Belizean because at this time Belize is not a stable country.
Devalue our dollar? Might not be a bad thing for those in the productive sector with huge debts. I’m gonna call the bank right now and see if I can borrow another 50m.
barrow is trying to negotiate this superbond so belizeans cud repay and dont feel burdened. It sounds as if most want barrow to pay off. jus remember the root cause of this superbond. I am a Belizean dont want the govt to ask for higher taxation, etc to pay for the bond cuz it will surely affect my living conditions. if u guys want PM barrow to quit negotiations and pay whatever the previous administration left in place, might as well we continue making loans and turn the dam thing into a mega bond since we bzeans like feel pain.
Ricky Malthus, your have an attitude, and it is suspect. Methinks you are sucking on some sour pokono boy. Thats all. lol.
Lovejoys……Very, very valid points. And Bzn, you said a mouthful. nough said!!
a new example of an oxymoron—a smart UDP.
U live in another world Louisville, if you have nothing good to say best thing you dont post anything. Stop hitting on other people’s opinion. Just your comments tell me a lot which political color you represent.
If you gonna be political about the issue stay away… Point blank…
Uncle Benji, I can truly agree with you on your comment regarading the pm and his sheep. The very sad part is that he is taking this country into a danger zone. I don’t believe this man has any idea how to run a country. I am so tired of my country becoming a laughing stock. It is time to go back under British rule or become an US protectorate as Puerto Rico did. God help this country.
if the previous admimistration didnt make such a loan.. then we belizeans didnt have to pay bakand yet musa has the face to still sit infront of us ….