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Nov 15, 2016

Get Ready for Higher Taxes and Retrenchment, Opposition Warns

John Briceño

Batting away reminders that his party, when in Government, packaged seventeen original loans to form the Superbond and that much of that debt has still not been paid, P.U.P. leader John Briceño laid the blame on the current administration for squandering multiple opportunities to fix the state of affairs through sustained economic growth, citing the B.T.L. takeover and PetroCaribe spending as examples. As a result, he said, he will not be shocked by tougher fiscal measures, including possibly lowering of the wage bill by retrenching salaries, coming as soon as the next fiscal year. But he still expressed hope for success with the bondholders.

 

John Briceño, P.U.P. Leader

“The Petrocaribe money saved the Prime Minister from increasing taxes about two years ago – that influx, that three hundred and seventy-five million dollars, gave him a little bit of breathing space, because we knew it was coming. The I.M.F. had been crying out for some time that we have to increase taxes, because this Government refuses to do the right thing. Hundreds of contract workers have been employed by this United Democratic Party government. Hundreds of cronies have been given jobs, just to say that you could get a salary, and they have bloated the wage bill. And the I.M.F. have been telling them, you have to do something about it. He was doing everything possible to hold on for his third term; he got his third term, and now he knows that he will have to do the inevitable: he will have to raise taxes, and will have to cut expenditure, and by cutting expenditure it is going to be that people are going to be retrenched, and they are going to hold on to the amount of monies that they are spending in the economy, and that is going to create a bigger problem. I am first a Belizean; I want things to go well in this country. And if the Government has embarked in a re-negotiation of the Superbond, of course I want it to be successful; of course I want to find ways where we can pay less in any of our debts, and then use that money to be able to invest with our people, in creating jobs, in the economy, crime, poverty. Of course I want that to happen. But let us not forget that this problem was created by the Prime Minister and his incompetent Cabinet. If they had done the right things four years ago, in 2013, or three years ago, we would not be in the situation we are in today. That is my point – not that we don’t want them to succeed, but it is because it is a problem that has been created by the United Democratic Party government.”

 

Ambassador Espat said that Belize is hoping for relief in any one of three areas: the coupon or interest rate; the time of principal repayment, currently August 2019; and the date of final maturity – August 2035. Even as the restructuring exercise begins, Belize’s credit rating has dipped from a ‘B’ to a C.C.C. plus by Standards and Poors, which is citing government’s inability to meet its debt obligations. 

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