Belize

Caribbean countries are lobbying furiously for an extensive international debt relief and investment programme, as politicians become increasingly anxious over the social impact of the region’s economic crisis and the resulting government austerity, the Financial Times reported. Most of the dozen anglophone countries in the tropical archipelago off the coast of the US are struggling with large government debts and lacklustre economies after the global financial crisis hurt tourism, the dominant industry of the Caribbean.

Three bond restructurings totaling about $9.7 billion in the Caribbean this year are failing to ignite economic growth and may not help the region avoid more defaults, according to Moody’s Investors Service, Bloomberg reported. The bond swaps this year didn’t go far enough to fixing the Caribbean’s “unsustainable” mix of debt and deficits, Warren Smith, the president of the Caribbean Development Bank, said May 22.

The government of Belize proposed new terms to restructure the country's $544 million in debt Tuesday in an offer that extended the maturity of the debt and reduced coupon payments, Dow Jones reported. In an address to the nation's House of Representatives, Prime Minister Dean Barrow said the terms of the new plan extend the defaulted bond's maturity to 2038, from 2029, while they reduce the coupon to 5%, from 8.5%. The agreement would provide the country $247 million in relief over the next 10 years, Mr. Barrow said.

Belize's government released two new proposals Thursday detailing how it could restructure the country's debt, Dow Jones reported. 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.

Belize and its creditors are negotiating a debt restructuring proposal, according to a statement posted to the website of the country's central bank, Dow Jones reported. Belize defaulted in September, a month after it failed to make a payment on its $548.3 million debt. The government and its creditors have been negotiating for several weeks, but the statement, posted Tuesday, was the first public sign of progress. "I think at this point they're getting ready to formalize an offer," said Edward Al-Hussainy, an analyst at Moody's Investors Services.

Belize is poised to default on its only bond, as the country's negotiations with creditors continue, The Wall Street Journal reported. In August, the Central American nation failed to make a $23.1 million interest payment, initiating a 30-day window during which it must pay or become the first country since Greece to default on its sovereign debt. The grace period was scheduled to end at 5 p.m. EDT Wednesday. Belize and its bondholders are negotiating to restructure the country's debt.

Belize’s creditors are betting the Central American country will improve its bond restructuring offer in order to maintain access to global debt markets. The government says it doesn’t need them, Bloomberg Businessweek reported. Belize’s $1.4 billion economy, which expanded 2 percent in 2011, can go without more borrowing on international credit markets, Prime Minister Dean Barrow said in an Aug. 22 press conference. The country didn’t sell global bonds before 1998 and hasn’t returned to them since a 2007 restructuring. Barrow’s government, which missed a $23 million coupon payment on Aug.

Belize’s government aims to restructure its debt through negotiations with bondholders and will consider any proposal presented, Prime Minister Dean Barrow told reporters in Belize City Wednesday, Bloomberg Businessweek reported. The country has worked in “good faith” with its creditors and is willing to discuss alternative restructuring scenarios, Barrow said, while stating that the government would only accept proposals that involved sustainable debt levels. “Debt sustainability is the whole and entire object of this exercise,” Barrow said.

Belize has threatened to withhold a coupon payment due on a $547m bond this month, which could plunge the Central American country into formal default and casts a cloud over restructuring talks with creditors, the Financial Times reported. The bond maturing in 2029 is a product of a previous debt restructuring in 2006 and represents roughly half of Belize’s total public debt, according to the government. “We simply cannot afford this coupon payment given the financing shortfalls and other challenges we face,” Dean Barrow, Belize’s prime minister, said.