74 F
Belize City
Saturday, October 16, 2021
Home Editorial The road to “bondage” — 1998 to 2020

The road to “bondage” — 1998 to 2020

On May 19, the Government of Belize issued a press release informing Belizeans that it had officially requested of the holders of our so-called Super-bond that they agree to extend the grace period for an interest payment that was due last week. According to the Amandala, our government is asking for an extension “until September 19, 2021 – the end of the grace period for the next scheduled coupon payment, which is due on August 21.”

At the presentation of his government’s first budget after taking office in 2008, PM Barrow stated that our largest external obligation was the Super-bond, which amounted to US $546.8 million and represented “slightly over 98% of the outstanding commercial debt.”

After the UDP government announced in 2017 that it was seeking to restructure the bond to make the interest payments easier, the Amandala of Tuesday, March 7, 2017, reported that, since 2008, Belize had made roughly $500 million in interest payments…with “over $800 million due in interest alone between now and when the bond matures in almost two decades.”

The story of our “bondage” begins around the end of 1998, a time when Belize’s total external debt was less than US$400 million. In 2021, our total external debt has more than tripled, standing presently at US $1.4 billion.

The UDP government of 1993 to 1998 came to power on a pledge it did not intend to keep — that it would repeal the Maritime Areas Act, along with a host of wild promises, including free education. That UDP government did little for the economy and, with the economy crumbling in 1997, it jettisoned 800 of its employees, a decision that ranks amongst the most ignominious ever by a government in our country.

When a new PUP government took over after the August 27 general elections in 1998, it had an overwhelming mandate to grow the economy. That PUP government believed in privatization, and it sold majority shares in our three major utilities: Belize Telecommunications Ltd. (BTL), Belize Electricity Ltd. (BEL), and Belize Water Services Ltd. (BWSL), with BWSL, which was sold in 2001, being bought back in 2005. The PUP also sold the Port of Belize to a friend of the party, and the friend shortly after lost the asset to the Belize Bank.

The PUP government of 1998 to 2003 embarked on a program to increase the number of houses owned by Belizeans by 10,000, and to this end it invested in a number of housing projects, the largest of which was a disappointment because of poor construction and being built on land that was of dubious ownership. That largest housing project, actually a satellite town which was named Mahogany Heights, remains economically dormant more than a decade after it came into existence, but with a new PUP government in place, it could be expected that some interest will be shown in improving on its shortcomings.

The PUP government of 1998 to 2003 followed up on the construction of the Mollejon, a run-of-the-river hydro generating plant which was commissioned during the party’s 1989-1993 government, by attracting private investors to construct two new dams on the Macal River — the Chalillo and the Vaca. The PUP government of 1998 to 2003 constructed a number of schools, and it oversaw the birth of the University of Belize, which has been a middling success, according to some sources. The charge stands that the training of nurses and engineering studies have declined since government’s tertiary institutions were amalgamated to form the University of Belize, but no in-depth study has been done to corroborate or refute those views.

The ambitious PUP of 1998-2003 expanded tourism, and it sought to introduce a single bus line to control public transportation, an initiative which, for various reasons, including the need to increase bus fares to make a modern transportation fleet sustainable, ended up being a colossal disaster. The PUP of 1998-2003 introduced a National Health Insurance scheme, which didn’t get much past the pilot stage, and it spearheaded the construction of a second for-profit private hospital, Universal Health Services (UHS), now Belize Healthcare Partners Ltd., a private institution for which the country of Belize is over $100 million in debt.

On the critical matter of good governance, that PUP government also facilitated the Political Reform Commission, but failed to act on most of the recommendations put forward by the group’s members.

The PUP government of 1998 to 2003 was set back by a number of storms, two of which were major hurricanes, but its major faults were massive hustling by some big players in the party, and the mindboggling decision to borrow on the commercial market with its stratospheric interest rates. The 1998-2003 PUP government was extended a second mandate, between 2003 and 2008, during which term the corruption and wild borrowing in its previous administration caught up with it, and it was exposed.

In 2008, a new government (UDP) took over the reins with an overwhelming mandate to pick up the pieces, and it can point to a few successes. The party can point to encouraging the expansion of the BPO, tourism, and sugarcane industries; the construction of some major bridges and resurfacing of some major roads; the construction of some high-quality sports arenas and infrastructure works in the cities and towns; and numerous roundabouts — projects that were funded from the largesse of the Alba Petro Caribe Program, royalties/taxes derived from oil wells in Spanish Lookout, and soft loans from friendly countries and international lending agencies.

The UDP’s failures were legion. The UDP failed to get back the Port of Belize when they could easily have done so, failed to pay back the UHS loan when it was one-third what it is now, failed to get back BTL at a reasonable price, failed to protect our good name (They let us fall victim to major scandals at the Immigration Department and Sanctuary Bay), failed to curtail corruption in government, and failed to keep its members from associating with some of the most unscrupulous characters in the world.

The worst UDP sins were that it trampled on good governance and it kicked the Super-bond down the road when the country had the funds to put a dent in the principal and thus reduce the onerous interest payments. Despite its failures, the party won three consecutive general elections — in our warped two-party, first-past-the-post system which we use to choose our leaders.

Instead of addressing our external debt, the UDP increased it; then the pandemic came along and made things worse, and thus, 22 plus years after 1998, we stand here today, hat in hand, a serial defaulter — a people in “bondage”.

- Advertisment -

Most Popular

US to open border with Canada, Mexico starting in early November

The United States will lift restrictions at its land borders with Canada and Mexico for fully vaccinated foreign nationals in early November, ending historic...

PM speaks on Belize’s economy

BELIZE CITY, Thurs. Oct. 14, 2021-- While being interviewed by local reporters yesterday, the Prime Minister, Hon. John Briceño, noted that the country is...

Khalydia Velasquez, Belize International Day of the Girl – “We Belong”

Concacaf.com, Mon. Oct. 11, 2021-- Khalydia Velasquez might be the youngest Belizean player to score internationally in 2018 at IMG Academy but you would...

No bola rolling, but ballers still passing

BELIZE CITY, Mon. Oct. 11, 2021-- There is no football playing in Belize for over a year now due to Covid-19, and the football...