BELIZE BOND HOLDERS FACE RESTRUCTURING AGAIN?

BELIZE FOREIGN BOND HOLDERS TO GET A SHOCK IN 2012

Since the world depression is also effecting Belize, the annual expected revenues are projected to level off at $750 million a year. The new UDP Government under party leader and Finance Minister, Dean Barrow has been keeping a lid on economic statistics. SECRECY has been the modus operendi. This has government watchers and local economists, within Belize very worried. It is in the nature of a ruling political party to only wish positive good news to be announced, or published. Usually with a spin on it, to the credit of the incumbent party.
With a projected leveling off, of Government Annual Revenues, due to external World conditions in the $750 million ball park figure, through the rest of the UDP term, over the next four years, things are not looking so good. The BARROW UDP government, managed to get a lot of small loans from different foreign institutions during 2008, for needed infra-structure repair, to the tune of $200 Bz million, to be spent on the country during 2009 onwards. This should give an artificial 1 1/2% jump in the GDP rate at the end of 2009. The UDP term of office will expire in 2012. This means 2012 will be an election year, a traditional time of more borrowing and overspending to influence the elections. It is possible with an economic crisis looming and an election in the same year, that the UDP will decide to hold a surprise early ELECTION. Possibly in 2011, or early 2012?
The big thing is the outstanding BELIZE BOND debts, totaling around $3.2 billion Bz currency. Because of the SECRECY being practiced by the BARROW, UDP government, we are only dealing with rough economic statistical numbers. Next year in 2010, a balloon interest payment is expected to hit the government, when the BELIZE BOND interest payments jump to 6 1/2% per year interest. Currently the interest paid out of the $750 million annual government revenues consumes about $265 million of the annual revenues. Next year in 2010 ( we don't know the date? ), the interest is expected to jump annual BOND payments to over $350 million of the $750 million the government will collect. The government operations themselves run between $475 million to $600 million, depending on who you talk to in the government. Obviously by the end of 2010 the government will be forced into austerity measures. The big JUMP or BALLOON payments occur in 2012 ( again we do not know the date ), but the BELIZE BOND payments jump in interest rate to 8 1/2%. This is projected to be about $750 million in government revenues that have to be paid out to FOREIGN BOND HOLDERS and would consume ALL THE GOVERNMENT REVENUES. Leaving NOTHING to support the civil service obligations and a functioning government.
What is feared is a DEFAULT under the UDP government, under the management of Finance Minister, Dean Barrow, who also holds the titles of Prime Minister and Leader of the party. It has been announced in the media that BARROW will retire in 2012, after the election.
A financial crisis is rapidly developing over the FOREIGN BOND HOLDER INTEREST PAYMENTS inside Belize. The BOND HOLDER interest must also be paid in FOREIGN EXCHANGE, of which there is normally a shortage within the country itself.
BANKRUPTCY, DEFAULT, are all possibilities in this worrisome scenario. Things could start to come to a head as early as in 2010, when the first interest rate jump occurs to 6 1/2 % on the bonds. Nobody knows how the country will pay? Nor where they will find the foreign exchange?