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May 14, 2020

G.O.B. Maxed Out Commercial Borrowing

Dean Barrow

With a burgeoning deficit of over three hundred million dollars, Prime Minister Dean Barrow says that the time has come to trim emoluments and pensions which stand at a whopping six hundred and eighty-eight million dollars.  The international financial institutions have been advising his government to do so for quite some time now, but the PM managed to avoid taking the bitter pill.  According to the Prime Minister, due to the harsh and crippling economic impact of COVID-19, international institutions such as the IMF would strengthen their call for government to reduce debt. And as he makes his way out of office, PM Barrow warns that whoever becomes the next Prime Minister would need to go to international financial institutions for necessary lending post COVID-19.


Prime Minister Dean Barrow

“However it is pitched, there is this now in my view deafening cry on the part of the international financial sector , on the part multilaterals for some kind of debt relief, for some kind of debt standstill,, some kind of possible debt forgiveness to take place. We are naturally anxiously following this discussion. The next superbond payment is due on August. We want to see where this discussion will lead before we take position and begin some sort of a conversation with our bondholders. On the other hand, there are those who would say that the writing is very clearly on the wall. If I wanted to take the view that because my departure from electoral politics both inevitable and imminent, depending on how you describe imminent, I could not worry about various things. I would then cop out of this whole contretemps if you will with the unions. I could say what does it matter if I agree with you that in two years time you get it back. I won’t be here for you to collect it from but I don’t think that is responsible. I don’t think that is fair. Ultimately as part of our efforts at recovery w ho comes next in my view will more likely than not have to talk to the IMF. Who comes next will have to talk to the IFIs generally. Who comes next will need assistance, serous funding assistance. Any chance of further commercial borrowing is shot. So we will have to go to these people and they will extract their pound of flesh. It is a kind of old automatic. They won’t give the assistance that you require except if they say, aha you will no longer be able to proceed as though you are heedless to what we have been telling you for years and years and years. A condition for the assistance that you will need is in fact pension reform, is in fact the trimming of the wage bill, is in fact retrenchment in the public sector. Now, if I were still in play I could sit here and tell you I would find a way to dodge that but when you don’t have to face the music, you can pretend to be the most skillful dancer in the world you know. Bottom line is, I grieve for my poor Belize and I certainly extend my sympathy from now to those that will have to deal with that particular problem.”

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