P.M.: Debt negotiations going “reasonably well”

Following this morning’s ceremony, we took the opportunity to ask the Prime Minister how negotiations are proceeding with Belize’s international creditors. According to the P.M. efforts to “re-profile” government’s billion U.S. dollar debt are going “reasonably well”.

Prime Minister Said Musa
?The creditors need to be assured that they will get paid yes, but also I think they need to be convinced, and this is the whole point, that if they don?t cooperate and the country reaches a point where there is no cash flow to service the debt then they will be the losers as well. So it?s a question of working together to come up with an acceptable solution. We?ve had a full round of consultations with over ninety percent I believe of the commercial creditors. That work is now complete. We are now receiving inputs from them as to a reaction if you like to what was discussed with them.?

Janelle Chanona, Reporting
?I understand we are presenting different scenarios, as many as three can you tell us what those are??

Said Musa
?Yes, in fact, Belize perhaps unlike any other country before has been very open and transparent with this whole exercise. And in fact we have not only given all the numbers, the full I.M.F. and everything to the creditors but also posting on the Central Bank website, three possible scenarios as to how we believe this debt rearrangement could go and offered to them for discussion and input like I said. Basically the scenarios deal with, the first two deals with a principal haircut if you like, and the third scenario is dealing with a re-profiling coupon cut to spread out the debt over fifteen to twenty years. The coupon is the equivalent of the interest, when you borrow from the bank, the interest that you pay. In the third scenario, we are asking for a reduction in the interest then where as in the first two deals with the principal.?

Janelle Chanona
?What happens if one creditor or a number of creditors don?t like what we are presenting? Is there room for negotiation??

Said Musa
?Well that is the whole point of the exercise to negotiate a consensus position that when we do make the exchange offer we will do so on the basis that this will be acceptable to the majority. Perhaps you?ll never get a hundred percent approval or support but we?re hoping we?ll get a majority.?

Over the last few months meetings with creditors have been held in Jamaica, Trinidad, Barbados, Miami, New York and London.