No matter what happens BTL/BEL will be the winners .
Belize's government released two new proposals Thursday detailing how it could restructure the country's debt.Belize and its creditors have been negotiating a debt restructuring ever since the Central American country defaulted in September, a month after it failed to make a payment on its $548.3 million debt.Thursday's statement was the first public restructuring proposal since the default.The new restructuring scenario asks creditors to forgive 33% of what they are owed, or allow the country to delay debt payments for 10 years. The terms are more favorable to creditors than the previous restructuring proposal, in which Belize asked bondholders to forgive 45% of what they are owed, or allow the country to delay any debt payments for 15 years."They're pushing for a pretty aggressive haircut" in the latest proposal, Moody's Investors Services analyst Edward Al-Hussainy said.Belize has argued it needs the debt restructuring to close financing gaps from payments for company nationalizations, decreased tourism and declining oil revenues.But the country's recent economic improvement could jeopardize its case for such a large debt reduction. In November, the International Monetary Fund said it expects Belize's economy to grow 3.5% in 2012, from 2.5% in 2011.In the statement, the government said it will seek feedback from bondholders and will remain open to discussing alternative structures that yield comparable levels of debt relief.On Nov. 21, Belize received a counterproposal from the creditors' committee. The three scenarios all proposed temporarily reducing the bond's current coupon rate while extending the life of the bond, and eventually returning to the current 8.5% coupon, according to the statement.However, Belize said the creditors' proposal doesn't provide enough debt relief.Belize Financial Secretary Joseph Waight couldn't be reached for comment Thursday.The negotiations could be affected by the Argentina debt restructuring case currently in New York courts. If New York law equalizes the rights of holdouts to those of restructured bondholders, Belize may find it more difficult to reach the 75% participation rate necessary to invoke the collective action clause embedded in the bond."The prospect of holdouts may, in turn, force the government to moderate its position from the indicative restructuring terms proposed in August," Mr. Al-Hussainy said.