BELIZE AND CARICOM COUNTRIES HEADING FOR SOME FORM OF DEFAULT, OR BANKRUPTCY SAYS GUYANESE PRESIDENT

Guyanese President, a trained economist, warns the outside world that ALL CARICOM countries are going to go into default, or bankruptcy SOON! With debt ratios to GDP of 170% and up, the economies of CARICOM are unsustainable.


BELIZE AND CARICOM COUNTRIES HEADING FOR SOME FORM OF DEFAULT OR BANKRUPTCY SAYS GUYANESE PRESIDENT



Caricom heading for bankruptcy - Guyana president
2010-03-27 06:40:00

The Caribbean regional trade bloc Caricom is heading for "bankruptcy" with many islands unable to pay debts and cover costs, Guyana's President Bharrat Jagdeo warned on Friday.

"The region is heading towards bankruptcy, if countries could be declared bankrupt," he said at a press conference.

Jagdeo, a Soviet-educated economist, heads a task force of the 15-nation Caribbean Community set up to look at ways the region can address the impact of the global financial crisis.

He said Caricom has been hit by a drop in revenues from tourism and financial services due to the crisis, compounded by a "pernicious" build up of debt and a loss of productivity.

Jagdeo is a leading proponent of debt relief for the region. He and other Caribbean leaders met World Bank World Bank president Robert Zoellick in Dominica last weekend.

Zoellick agreed to work with CARICOM to devise a debt management strategy for each country, Jagdeo said.

(Reporting by Neil Marks)
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Belize has a Debt to GDP Ratio of 107%. Two years ago when they came into office the UDP government started off with a whopping 76% Debt to GDP ratio, left by the outgoing PUP government, back then after the national elections. Prime Minister Barrow says his government is looking at an additional increase this year of fiscal year 2010 of another 3% thereabouts in the debt ratio. To around 110% of Debt to GDP ratio. Government cuts in spending are now the force passing through Government Departments like a dose of diarrhea. These first departmental budget cuts are mild. Overall we expect a cut in spending on the government of Belize of 40% from 2009. The money just is not there and the loans are drying up, with which to run the Government of Belize. We generally expect additional cuts of 5% per quarter over the next 18 months, to make any sense at all of this budget cutting exercise.
Government costs around $550 million a year. In our twin parallel economies, one that is called BIG GOVERNMENT sustained by GRANTS and BORROWED FOREIGN LOANS, and the other the smaller one currently, called the PRIVATE SECTOR production for export. The government economy is the bigger one. This is all about to change by force of financial stormy weather looming very quickly over the horizon. The storm clouds are brewing and the hurricane is expected to change forever, the way we govern the country of Belize and administer the police forces. The cost of our centralized government in a rough estimate is going to have to shrink to a budget of $330 million.
Already talk is floating around the internet chat forums with Belizeans, on the wisdom of the major criminal town in the country going to a different policing system. The ideas have been batted around for 25 years, but colonial trained lawyers in politics have fought any change to the status quo, constantly. Money lacks, may do what wisdom and common sense could not do? The idea is that the one town of out of nine national towns, but being the port with the worst national crime record, hold elections for a SHERRIF and that Sherrif hire his own cops from a civil service exam, impartially administered in a double blind testing model. That the then money currently budgeted for policing for the port town, be given as an operational GRANT equal to current expenditures by central government, and then the new 2 year elected SHERRIF and the City Council derive other ways of raising money for expansion, if required of the new policing system. This to be expected would be a pilot model, to see what the problems might be, when the police are independent of National Political party control and Town Council controls, subject only to the voters at the ballot box of Town Council elections.
Current department heads and bureaucrats are going to have to figure out ways of administering the same quality, or better services to the public at 40% less money to do it with, over the next 18 months. That is the rough picture facing the very large BIG GOVERNMENT ECONOMIC SECTOR. The borrowed foreign loan money is due to come to a very quick halt.