Belize Announces Commencement of Consent Solicitation

The Government of Belize announced today that it is seeking the consent (the "Consent Solicitation") of eligible beneficial owners (the "Holders-1 of Belize's U.S. Dollar Bonds due 2034 (the "Bonds") to extend the grace period applicable to the May 20, 2021 coupon to September 19, 2021 (the "Proposed Amendment", with the effect that the amended grace period will expire on the same date as the grace period applicable to the next scheduled coupon, payable on August 20. 2021. The terms and conditions of the Consent Solicitation are detailed in a consent solicitation statement dated May 19, 2021 (the "Consent Solicitation Statement").

Belize's economy and financial condition have been acutely affected by the consequences of the COVID-I9 pandemic. The primary deficit increased to 8.3% of GDP in fiscal year 2020/2021 from 1.4% of GDP in fiscal year 2019/2020. In addition, the Government's current projections indicate that the primary balance could fall to a deficit of 2.8% for fiscal year 2021/2022. According to the Staff Concluding Statement or the 2020 Article IV Mission, real GDP in Belize is not expected to return to its 2019 level until 2025. Following extensive stakeholder consultations. Belize is implementing a "Five-Year Homegrown Recovery Plum-starting with the 2021/22 national budget, already approved by the Parliament of Belize.

As a result, the Government has implemented aggressive fiscal adjustments measures and commenced consultations and discussions with advisors, bondholders and other parties regarding possible alternative terms for meeting its contractual obligations under the Bonds. The Government is seeking consent from Eligible Holders (as defined in the Consent Solicitation Statement) to the Proposed Amendment in order to give the Government the necessary time to discuss these alternatives with representatives of the Holders and execute an appropriate transaction.

Belize will pay to each Eligible Holder that delivers a consent in accordance with the procedures described in the Consent Solicitation Statement a consent fee in an amount equal to U.S.$0.50 for each US$1000 principal amount of Securities held by such Holder: provided that Belize receives the Requisite Consents and the Proposed Amendment becomes effective. Holders of Bonds for which no consent is delivered will not receive such consent fee.

The Consent Solicitation will expire at 5:00 p.m., New York City time, on June 1, 2021, unless extended or earlier terminated by Belize.

Identifiers for the Bonds consist of CUSIP Nos. 07782GAG8 and P16394AG6 and ISIN Nos. US0778GAG82 and USP16394AG62.

Global Bondholder Services Corporation is serving as Information and Tabulation Agent. Eligible holders may obtain copies of the Consent Solicitation Statement from Global Bondholder Services Corporation by telephone at +1 (866)470-3700 (Toll-Free) or +1 (212) 430-3774 (Collect), email address: [email protected] or by download, following registration, via: https://gbsc-usa.com/eligibility/belize.

Important Notice

This press release is not an offer of securities for sale in the United States, and none of the Bonds has been or will be registered under the Securities Act or the securities laws of any other jurisdiction. Unless they are registered under the Securities Act, the Bonds may be offered only in transactions that are exempt from registration under the Securities Act. This press release does not constitute an offer of the Bonds for sale, or the solicitation of an offer to buy any securities, in any state or other jurisdiction in which any offer, solicitation or sale would be unlawful. This press release does not constitute, and may not be used in connection with, an offer or solicitation in any place where offers or solicitations are not permitted by law.

This press release and any other documents and/or materials relating hereto is not being made and the pros release and such documents and/or materials have not been approved by an authorized person for the purposes of section 21 of the Financial Services and Markets Act 2000. Accordingly, this press release is not being made and related documents and/or materials have not been distributed, and must not be passed on, to persons in the UK other than (i) persons falling within Article 43(2) of the Order, including existing members and creditors of Belize or (ii) any other persons to whom they may otherwise lawfully be made or distributed under the Order (all such persons described in (i) and (ii) above together being referred to as "Relevant Persons"). In the UK, any investment or investment activity to which this preys release or any related documents and/or materials relate is available only to Relevant Persons and will be engaged in only with Relevant Persons. Any person in the UK who is not a Relevant Person should not act or rely on this press release or any related documents and/or materials or any of its or their contents.

Questions regarding this press release should be directed to Joseph Waight at the email address: [email protected]

Mayday Default: Belize Asks Superbond Holders to Extend Grace Period

The Government of Belize did not make its May 20th Superbond coupon payment - and now it's asking for four months grace. A release says that it is, quote, "seeking the consent of eligible beneficial owners of Belize's U.S. Dollar Bonds...to extend the grace period applicable to the May 20, 2021 coupon to September 19, 2021...the amended grace period will expire on the same date as the grace period applicable to the next scheduled coupon, payable on August 20, 2021." End quote.

That means that, rather than just 30 days grace for today's coupon payment, Belize is asking for 122 days, and it is also asking, in advance, for a 30-day extension on the August payment - and to just consolidate two of them into one payment.

That's a lot, and don't expect bondholders to be happy with it. Yesterday, one of their representatives, Carl Ross - speaking to LOVE TV yesterday - was already complaining about Belize as a serial defaulter:

"I think it's going to be yet another default by Belize, but there is a technicality in the bond documents that says that, Belize has 30 days, there is a 30 day grace period on the coupon and so we do have a 30 day period that, you know, we're hopeful maybe the dialogue can intensifying those 30 days in those 30 days. It's not a good headline, certainly, but from a technical standpoint the default won't happen until the 30 day grace period is up."

So, as we told you, Belize wants more than those 30 days; it wants 122. In the interim, Government says it has engaged in consultations and discussions with "advisors, bondholders and other parties regarding possible alternative terms for meeting its contractual obligations under the Bonds."

As an incentive, Belize says it will pay each Eligible Holder that consents to this extension, 50 cents US for each $1,000 dollars in Securities that they hold.

That's the consent fee and bondholders have 12 days - unity June first to accept it.

It's a bold move for a government which, clearly feels it has little to lose. And one that has told bondholders, it is not going to the IMF - much to their chagrin:

"Another, yet, another restructuring where bondholders take big losses, ahm, is not fair unless it comes with some sort of reassurance, you know, that this time is going to be different. And, one way to provide some reassurance other than government promises, is to have an IMF program along with, you know to have IMF financing beyond the home grown program. I think we have to figure out a way if Belize is hellbent against the IMF as the Prime Minister says we have to figure out some way to receive some reassurances that if bondholders take another haircut, yet again, in addition to the many, many millions of dollars in haircuts that we've taken over the years, that this time is going to be different."

And today certainly does make it different already because while Belize has been in soft default before, it has not previously requested such a long extension on the coupon payment. We'll see what the bondholders say.

Channel 7