GOVERNMENT TO ASK NATIONAL ASSEMBLY TO APPROVE NEW DEBT RELIEF PLAN
December 07, 2006
Government announced yesterday that it will ask the National Assembly to approve a new debt relief program.The National Assembly will be asked to approve financial terms of an offer to exchange most categories of Belize’ outstanding external commercial debt for new U-S dollar bonds.Government says that if the National Assembly approves, the exchange offer will be formally launched later this month. The financial terms are based on economic data and forecasts that have been published by the International Monetary fund as part of Belize’ most recent Article Four Consultation by the I-M-F, and take account of view expressed by creditors during a four-month period of consultations. Government is asking the National Assembly to approve the issuance of new bonds that will mature in 20-29, with principal payments beginning in 20-19.The New Bonds will bear interest in the first three years after issuance at a fixed rate of four-and-quarter percent per year. In years four and five, the rate will increase to six percent, and then level off at eight-and-a-half percent. The terms of the exchange offer are expected to provide that all creditors taking part will receive a cash payment at the closing of the transaction equal to unpaid interest on their tendered claims accrued through to the closing date. Interim debt service payments on the existing debts eligible for this exchange offer will cease immediately.