deanThe Barrow Administration’s plans for a third Superbond renegotiation has intensified with Prime Minister Dean Barrow returning to New York this week to hold further discussions with bond stakeholders. The Government’s team, led by senior advisor Ambassador Mark Espat, Minister Carla Barnett and Financial Secretary Joseph Waight have compiled a document to be presented to bondholders. That 22-page document paints the bleakest, grimmest picture on Belize’s economic state and outlook we’ve ever seen admitted by the Government.

The document is split into two main sections that look at economic conditions in the country and the Government’s inability to meet its debt obligations under the terms of the Superbond. Even the overview which isn’t part of the substantive presentation speaks of “Belize: An Imperiled Economy” in its title. Perhaps it sets the tone for what stakeholders shouldn’t expect when they probe further.

In the report, the Government puts forth economic data showing economic decline since 2012. It shows that the projected 5-6% GDP growth in 2014 never realised, and while a nominal 1% growth was predicted for 2016, the fact is that there will be a deep economic shrinkage.

The document also points to the widening deficit margins and the declining foreign exchange reserves. It notes that the payment of compensation to the owners of the nationalized companies are a significant factor. It then warns that additional payments in 2017 will further erode the nation’s foreign exchange assets.

Again, this is the most negative economic review we’ve seen from the Barrow Administration but it might not be so surprising since they are desperate for a Superbond renegotiation agreement. Any kind of agreement would only appear to produce positive results for Belizeans with temporary lowered payments which would provide a kind of breathing space for the Government, but in reality the interest for the debt would spike and the debt payment would be prolonged much further into future generations of Belizeans.

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