ORANGE WALK, Fri. May 14, 2021– During an interview on Friday that was aired on CTV3, the Prime Minister, Hon. John Briceño, remarked that he was not surprised by the apparent unwillingness of holders of the country’s Superbond to proceed with further restructuring of the Superbond and the hardline position they recently took in the midst of negotiations with Belize’s debt management team.
The country is currently seeking yet another haircut, reportedly almost 30%, which would result in an overall reduction of the debt and possibly a reduction of interest fees.
The bondholders are strongly urging the government of Belize to sign on to an IMF standby agreement before they move forward with yet another restructuring, which would be the fifth such restructuring of the massive debt. The Briceño administration, however, continues to rebuff the IMF’s prescribed path for recovery — preferring instead to stick to the PUP’s homegrown plan of recovery.
“We were not surprised by their response. We expected that response. Both sides have to put their cards on the table, and now it’s time for the real work to begin. We believe that pretty soon we will be sitting down in earnest to see how we can break this impasse and move forward. The reality is, the truth is, that Belize is in a position right now that we cannot afford to be able to pay the bond the way it is structured, and we believe it is time for us to be able to look at how we can reduce what we owe and hopefully reduce the interest rates and then be able to find a sustainable path towards paying the bondholders,” the Prime Minister said.
The Prime Minister further stated that they have informed the bondholders that they do not have the money to meet the May 20th coupon payment, approximately US 7 million dollars. Last week his Minister of State, Hon. Chris Coye, mentioned that the budget for this fiscal year anticipates a restructuring of the Superbond debt.
The bondholders appear, however, to be holding firm to their position — that Belize must go to the IMF. The PM is optimistic, however, that a compromise will be reached with the bondholders.
“I am an optimistic person. I believe, at the end of the day, we will find a compromise to see how we can put Belize back on a sustainable path. The debt to GDP of 135% is unsustainable. No government can really afford that, unless if you are a Japan or United States that has a huge economy. We don’t. We can’t be spending all of this money only just on paying loans when we have other pressing matters. Fighting poverty, making sure our children can go to school, improving the health services, and creating opportunities and jobs for Belizeans —that is what is driving us,” said Prime Minister Briceño.