Belize To Launch Debt Exchange Offer By Year-End -Officials
Tuesday September 19th, 2006 / 10h18
SINGAPORE -(Dow Jones)- Belize's government aims to launch an exchange offer to restructure its existing overseas bonds by the end of this year, senior government officials said Tuesday.
The government is waiting for the International Monetary Fund to approve the latest economic projections - expected mid-October - before beginning a final round of talks with creditors, the officials said.
The government would then launch the formal exchange offer, preferably by the end of the year, they said.
The officials were talking on the sidelines of the annual meetings of the IMF and World Bank, and asked not to be named.
The government plans to issue one new bond to replace the six series of existing bonds and commercial loans, the officials said. Furthermore, their preference is for an amortizing bond that would be paid back in several installments, rather than a bullet bond with a single payment in the final year.
According to the government's latest figures, Belize's total debt is about $1.1 billion, including $338 million in six series of bonds and $253 million in commercial loans, which are targeted under the debt restructuring.
The government owes a further $371 million to multilateral and bilateral loans and $116 million in domestic debt.
About 30 creditors own 80% of the Belize's bonds, but they didn't get together to form a creditors' committee and the negotiations will be conducted on an individual basis, the officials said.
Talks with the private sector creditors have been positive, and the government has emphasized the dire problems facing the Belize economy.
"All creditors understand there is a serious situation in Belize and a restructuring is inevitable," said one of the officials. "There is a sizable (financing) gap that needs to be filled."
Belize, a tiny country in Central America, has been wracked by hurricanes, high oil prices and lower export revenues.
They aren't the result of a temporary liquidity squeeze, which was the problem faced by the Dominican Republic and Uruguay - two other small Latin American nations - in recent years, the officials said.
"So the solution is going to look different," said the officials.
-By Matthew Cowley, Dow Jones Newswires; +65 9322 6310; [email protected]