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Nov 29, 2012

Recent superbond Restructuring offer rejected by GOB

There were hopes that a deal would be struck when the Debt Review Team and the Coordinating Committee of Belize Bondholders met following the US thanksgiving holiday. But the result is a reversal of a previous discussion. In August the Government publicized three Indicative Restructuring Scenarios that would reduce the long term payment and bond debt of five hundred and forty-four million US dollars. The bondholder committee rejected the proposal and showed good faith by accepting a partial payment from the government in September while continuing to negotiate under a sixty day extension. That extension has expired and the bondholders presented counter proposals on November twenty-first. They also had three alternative scenarios which offer a temporary reduction in the coupon rate. However, all scenarios include a return to the current eight point five percent coupon at the end of the reduced, temporary coupon period. The Debt Review Team posted today a memorandum to bondholders on the Central Bank website. It rejects the bondholders’ counter proposal and says that it finds the required terms undesirable. The release says (quote) “GOB considers it to be wholly incompatible with its objective of placing the country’s debt burden on a sustainable footing…the counter proposal ignores Belize’s high overall debt levels, and it amounts to little more than a short term fix.” (unquote). But it doesn’t end with Belize’s rejection of the counter offer. The government has been trying to find fiscal resources to make the once rejected August Indicative Scenario more attractive. That offer was also presented in the online memorandum. So it’s back to the discussion table for the two sides and GOB says it will seek feedback on the Revised Indicative scenarios from bondholders and remain open to discussing alternative structures that would provide better levels of debt relief.

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3 Responses for “Recent superbond Restructuring offer rejected by GOB”

  1. Storm says:

    First Barrow tells the head of the IDB to go to h**l.

    Second we reject the creditors offer for short term relief.

    As they say, we have 2 strikes on us.

    I really urge GOB to do the responsible thing, and retain an EXPERIENCED team to handle this for us. Pride and party politics must be set aside when it comes to negotiating the future prosperity or poverty of all our people.

    I really hope a survivable resolution can be negotiated, but it will not be easy.

  2. Anthony says:

    PM Barrow, just pay the coupon and call of the negotiations. The economy is growing fine, we do not need a restructuring. Everybody knows it.

  3. KISHORE MAKHIJANI says:

    I THINK WE HAVE TO BE CAREFUL OF THE WORDS WE SPEAK,ESPECIALLY,WHEN WE OWE.THE INTERNATIONAL SCENE SHOULD´NT BE CONSIDERED AS A CAMPAIGN GROUND FOR INTERNAL POLITICS.
    THINGS CAN ONLY BACKFIRE LIKE THIS, JEOPARDIZING THE ENTIRE NATION.

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