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Jun 26, 2020

Bondholders Form Creditor Committee to Consider Barrow’s Request

Dean Barrow

Belize’s bondholders have formed a creditor committee which will work with the Belizean government after they were asked to agree to defer payment of interest on the thirteen million U.S. dollar bonds. Reuters is reporting that the “committee looks forward to engaging with the government to exchange views on the economic pressures that may constrain Belize’s capacity to service full coupon payments in the near term”. The government has requested for interest capitalization on the Super Bond. PM Barrow was asked about it today. 

 

Prime Minister Dean Barrow

“In any case, there is a month grace period so any triggering of a default clause could not take place until September. We are fairly confident that we will not have a problem with the bondholders. We believe that the relief we are asking for is not particularly, in terms of the from the bondholders’ point of view, it is not a big ask.  So we think we will be alright.   I believe that going by way this fairly modest and moderate approach is the best thing to do at this time. If we simply said, can’t pay, won’t pay, there isn’t a whole lot that the bondholders can do in my view. I keep saying we don’t have assets abroad for anybody to go after, but the possible consequence of that could be that the I.F.I.s start to look at you differently and start to treat you differently. Ultimately, it could result in a cut off of other flows because the I.F.I.s, I think, don’t look at you particularly kind if you simply walk away from your obligations. This way, if, of course, there is not any agreement with the bondholders and we are in fact oblige to walk away, the international and, in particular, the I.F.I.s would see that we in fact tried.”


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