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Thursday, August 13, 2020
Home Editorial PM Barrow got his five years; we got taken to the cleaners

PM Barrow got his five years; we got taken to the cleaners

On September 28, 2015, Prime Minister Dean Barrow called on the Governor General, Sir Colville Young, and advised him to dissolve the House of Representatives and set November 4, 2015, as the date for a general election. The UDP, having won the previous general election in March 2012, had a mandate to remain in office until March 2017. The UDP won the 2015 general election, 19 seats to 12, thus they parlayed 16 months into 5 long years.

In November 2014 supporters of the UDP government came out in numbers to a rally in Belmopan, where they heard about all the wonderful things the government was doing to develop the country with extremely soft loans derived from the special loan program, the Petro Caribe fund, set up by the Bolivarian Republic of Venezuela. The crowd left that rally chanting, “Petro Caribe, Roll it!”, but their leaders knew that there was a leak in that balloon, that the program was slowing and would soon come to a halt.

A Bank of Canada review of the oil market during that period, said that the price per barrel (Brent crude oil price) was stable at US$110 between January 2011 and June 2014, and from then it fell steadily, to as low as US$29 per barrel in January 2016, and throughout 2015 the average price per barrel of oil was US$50. This fall in the price of oil on the world market hit Venezuela very hard, and Belize, which was chanting “Petro Caribe, Roll it!”, saw the funds it was getting from the program fall by more than 50%.

In 2015 Belize was experiencing another oil-related shortfall, this one at the Belize National Energy oil wells in Spanish Lookout. In 2010 crude oil production in Belize peaked at about 4,200 barrels per day, and from that point it steadily declined, falling to 2,000 barrels per day in 2015 (data from indexmundi.com)

In 2015 Belize was also suffering major shortfalls in citrus and shrimp production, and so our government, a government that had lucked into more money to spend than any government previously, saw hard times up ahead. On top of all the economic bad news in 2015, there were legal fees and interest payments that were mounting in the costly ongoing battle over the nationalization of BTL. The matter was before the Caribbean Court of Justice, with a ruling expected later in the year.

In mid-September 2015, PM Barrow announced at a press conference at the Best Western Biltmore Hotel that he had, while in Miami in the USA, negotiated a settlement agreement with Lord Michael Ashcroft over the government’s acquisition of BTL. Barrow told the nation he was extremely pleased, that the settlement agreement was a “fantastic bit of good news.”

Barrow said Lord Ashcroft had always insisted that he didn’t have any financial interest in BTL, and that in respect to the settlement agreement the British billionaire had told him that he was acting “as a sort of Good Samaritan.”

When Belizeans first heard about the price agreed on for the return of majority shares in BTL to government control, most thought that the full tab would be around US$100 million, even though the price of the shares hadn’t yet been settled. We were told that an arbitration tribunal would determine the value of the shares, which we would be paying within a year; however, we had no need of real worry there because the Prime Minister had negotiated with the Good Samaritan so that the larger portion of that would be spent on charitable projects, all for the glory and betterment of our country and people.

Within a couple weeks of this great achievement, before the people of Belize became aware of the rot inside that deal, PM Barrow called a general election, and about a month later he was congratulating himself and his party, telling all who would listen how brilliant he was, and that we shouldn’t look for anymore snap elections while he was in charge because he and his party would reign for a full five years this time.

Later, when the dust settled on the deal, we learned that most, if not all, of the funds earmarked for charitable projects, had been gobbled up by management fees and legal fees that were paid, if not to Lord Ashcroft, to his friends, and that the full tab for BTL was about 500 million dollars, more than twice what we thought we would be paying when the deal was first announced.

PM Barrow had three options when he heard what the Good Samaritan was proposing: The first option was to cut our losses, give the company back, and try to contain the company’s conduct, by giving more teeth to the PUC and/or by forming a new telephone company. In the short term that would not have worked out in the UDP’s favor at the polls.

The second option was to leave the matter in the hands of the CCJ, and hope for a favorable outcome. This meant no immediate “fantastic bit of good news” about BTL, and if he rode out his mandate, Barrow would have been limping into the next general election, broke, because of all the previously mentioned sources of income that were drying up.

The third option, the one the PM chose, saw us break the bank to pay Lord Ashcroft and/or his friends, 500 million foreign exchange-sapping dollars!

There are outstanding questions about this settlement agreement. Was PM Barrow gullible, or was he overeager to win another term? In that room in Miami, did he propose the charitable projects to sugarcoat the bill so that he could get over in the election? There are a lot of questions. There are always many more questions than answers in Belize.

Lord Ashcroft, who has minions in Belize who swear that he has great love for Belize and Belizeans, said recently on his television station, Channel Five Belize, that our Super Bond is junk, and that our country needs to be more friendly to foreign investors. He also said that our government has paid out roughly 500 million dollars for BTL, and that his last look at the company leads him to believe that it isn’t worth a third of that!

No, it isn’t worth a third of that, but PM Barrow got his five years, and somebody, or a group of somebodies, took us to the cleaners.

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