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May 21, 2013

Moody’s update on Belize quite moody; country may renege on debts

Three weeks ago, the Moody’s Investors Service reported that the government’s bond rating of C-A-A was likely to remain the same for the next four or five years because of the two debt defaults in the past seven years coupled with the country’s low debt tolerance and weak ability to service external debt. Moody’s put the debt in the range of seventy percent of G.D.P. which in turn makes the government credit wordiness’ vulnerable.  An updated report issued on Monday by Moody’s says that Belize is among a growing number of Caribbean countries likely to renege on its debts as the region finds it difficult to tackle options to deal with their ailing economies. The report cites that debt restructuring has been undertaken twice in Antigua and Barbuda, Belize, St Kitts and Nevis, Grenada and Jamaica and that the risk of sovereign default is particularly high in Belize and Jamaica. Moody’s reports that the region’s debt problem has ballooned since the 1990s due to, “poor budget discipline and uncompetitive economies that have proven too dependent on tourism.” And a senior analyst, Edward Al-Hussainy states that the Caribbean’s debt crisis is the result of a combination of poor fiscal discipline and unproductive investment that failed to significantly raise potential growth rates.

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2 Responses for “Moody’s update on Belize quite moody; country may renege on debts”

  1. Initiate says:

    Very true: “Caribbean’s debt crisis is the result of a combination of poor fiscal discipline and unproductive investment that failed to significantly raise potential growth rates”

  2. Storm says:

    The opinion of an impartial, expert outsider — truth hurts!

    We will never build the economy and ascend toward prosperity until we have a government that [1] lives within its means, so that we are not held back by excessive taxation and [2] minimizes regulations and interference with private investment and [3] develops laws that attract foreign investment, such as most of our neighbors enacted long ago under the “Caribbean Basin Initiative.”

    We could all have a real chance to achieve the Belizean dream if government got out of the way of businesses and investors.

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