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Nov 23, 2011

PM says S&P does not affect country’s performance

Dean Barrow

In the wake of government’s acquisition of public utilities, U.S. based financial services company Standard & Poor’s downgraded Belize’s credit rating from a B to B minus in early August. But the outlook for Belize’s financial future was stable until this week, when S&P downgraded it to a negative and confirmed that the country’s rating borders a C.  The reasons given for the downgrade are growing crime, public sector wage pressures and budgetary setbacks.  Today however, P.M. Barrow dissed the ratings, saying they do not affect Belize’s economic performance and that the company also wrongly forecasted the United States’ credit ratings.

Dean Barrow

“The actual rating remains the same but believe me it’s no bravado when I tell you that’s a matter of supreme indifference where I am concerned.  Standard & Poor’s rates sovereign debt and that is only important for people who are in the markets, who are borrowing by way of bonds and that sort of thing.  The extent that it effects Belize’s bonds that are already out there, these are the bonds that are part of the Super Bond, it doesn’t affect us as a country in any way at all.  In terms of the trading in Belize bonds that are already out there it’s no doubt that it’s consequential but it doesn’t, we only borrow from the concessionary institutions now, from the multilateral institutions and so a Standard & Poor ratings has nothing to do with our ability to assume that kind of concessional development that so.  And because I am indifferent I suppose there’s no need for me to go and say anything about Standard & Poor’s in terms of their effectiveness but I will, why not, they downgraded the U.S from Triple A, what happened, there was a rush into U.S. treasuries.  There was a rush to assume on the part of other countries and individuals that in fact engage in this sort of thing to assume to buy more treasures.  The U.S. ten year note, the yield is at its lowest despite the Standard & Poor’s downgrade.  Your yield is dependent on the demand for your paper.  The more demand there is the less you can pay.  The ten year yield is down to two percent, in other words, Standard & Poor’s obviously got it completely wrong.”

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11 Responses for “PM says S&P does not affect country’s performance”

  1. Justice says:

    The pm still thinks he is lord of the world!

  2. MACAL RIVERA says:

    RE= JUSTICE
    AND WHO ARE TO JUDGE JUSTICE?? GOD WILL JUDGE YOU WITH THE SAME MEASURE YOU ARE JUDGING OK???

  3. Get it right says:

    Anyone that knows economics and International Business, in fact business management on a whole knows that what Mr. Barrow is saying is true. You don’t have to be a Business guru to understand that. I mean come on, how else can a organzation like that rate a country’s standard of living without even being in the country. STandard & Poor caused the stock markets to drop drastically when they downgraded the US bc consumer didnt have faith in the markets. That caused a further financial crisis just when the markets were picking up in the US. They cause more harm than good.

  4. me says:

    Isn’t this the same fella who lambasted the past PUP government with a Standard & Poors report? Now he is saying that the S & P report wont affect country’s performance. Got to keep and eye on this prime minister.

  5. ragga says:

    he is right

  6. Storm says:

    PM should keep his mouth shut. It’s not a ringing endorsement of his leadership to have our credit rating reduced even more. He just has no plan how to start climbing out of the hole that we have dug during the past 2 governments.

  7. sambo says:

    Who honestly believes that S & P are wrong to downgrade Belize?
    Does anyone really think the economy is getting any better?
    I don’t think so…

  8. murphy says:

    nop the economy is in a mess and who suffer poor people suffer a lot government should try come up with a way to generate employment, bring investors, not nationalizing companies. Foreigners will not invest in a Country when they know their company can get ripped off from their hands by a government, worst with the passing of the ninth amendment!

  9. Initiate! says:

    “Me”, hopefully the PM finally learnt what the S&P is since the time he was the opposition.

  10. Ricky Malthus says:

    Barrow must live on another planet to dismiss the economic ratings not only of Standard and Poor but also the other rating agencies. No foreign investor will invest in Belize , nor foreign Capital Banks will lend money in Belize. Even our local business men must be wary of suck craven, deprave remarks by the PM . You will see more investors will stay away. Anyone who really studied and understands economics will surely state what is stated here. Belize is sovereign only to the extent it is allowed to. Belize cannot use its suzerainty to fail in its duty to protect its citizens and cause the country to fall into a perilous economic depression. In a word , PM Barrow cannot be that callous not to understand that Belize needs USA, Mexico, Canada, inter alia. Do i have to regurgitate the mischief and maliciousness of this administration for you to understand?

  11. Ricky Malthus says:

    Barrow is wrong and must love the economic squalor he has led Belizeans to live in. Even the most advanced nations use Standard & Poor’s rating as one of the guides to help them to invest. Why would Belize be any different! Or is Belize on another planet? Anyone who studied and understands economics knows the rationale and wisdom of the rating system. Barrow is wrong and he projects Belize and Belizeans as Vapid.

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