Hon. John Briceno, Prime Minister of Belize: “Negotiations to restructure the Superbond have commenced. In good faith, Belize invited the formation of a Creditor Committee on 19th March and proposed new terms for this obligation, which at US$556.5 million, represents 28 percent of outstanding overall debt and 40 percent of external debt. More importantly, the current interest payments, set at a coupon rate of 4.9375 percent, or $55 million annually, constitute 45 cents of every dollar budgeted for debt service in the Approved Budget for FY 2020/2021.
In the proposed Budget for FY 2021/2022, there is a provision for the payment of a coupon consistent with the offer we have made to bondholders. That next coupon is due on 20th May 2021, by which time I would expect that negotiations would have been concluded. Last year, as Leader of the Opposition, I expressed the view that capitalizing this year’s interest payments, thereby increasing the amount of debt outstanding, was a self-defeating approach.
To ‘extend and to pretend,’ as our predecessors did on three occasions during their debt negotiations in 2013 and 2017 and with last year’s capitalization, is, in our considered opinion, both unwise and unviable. This was also the unanimous verdict of a recent Debt Sustainability Analysis conducted by the IMF. Therefore, securing near-term cash flow relief, as well as overall principal reduction, is the unambiguous basis upon which the current negotiations must, in our view, climax.”