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Central Bank Governor speaks on Petro Caribe payback

Yesterday we aired a portion of the interview with the Governor of the Central bank, Glenford Ysaquirre. The topic was Petro Caribe and the process that the Government follows in order to access money from that account. Now one key question that has been raised in the public forum is how will Belize pay back this loan since it cannot be used in a commercial matter. According to Ysaquirre, unlike the super bond, GOB will have hard currency to pay back this loan.

Glenford Ysaguirre – Governor, Central Bank

There is one element that I would like to say about the Petro Caribe fund that I think everybody is overlooking and it is something that I think is available to the press where you can verify that the monies from the Petro Caribe are being spent in Belize and a lot of comparison is being made with regards to monies borrowed under the super bond and there were concerns as to how it was used and disposed of but there is a clear distinction between what is happening under Petro Caribe and what took place under the Super bond. Under the Super bond we borrowed some $500 million USD over a period of time but if you look at the central bank reserves during that same period of time you would have seen that the central bank reserves actually shrunk so that would suggest to you that that $500 million dollars did not go on spending significantly in Belize but went to pay external debts or went somewhere else. Now when you look at what is happening under the borrowing that we are doing under the Petro Caribe if you look at the Central Bank reserves since 2008 it has grown from about $60 million dollars US we now have reserves in the neighborhood of $500 million US and to a large extent the buildup of those results are as a result of the hard currency that comes in from that Petro Caribe program so yes Belize dollars are being spent here but the US dollars are also coming in and building the reserves of the country so that when we need to repay any of the obligations of the government including the obligations for the super bond hard currency is there to do it.