PM Outlines Massive Petro Caribe Debt Reduction
The prime minister gave a statement on his historic meeting with Venezuelan president, Nicolas Maduro. He explained that while they are still balancing the books, they have renegotiated a deal that will reduce a quarter of a billion dollars of Belize's public debt and drop the debt to GDP ratio significantly.
Briceno explained the details of the agreement between the government and Venezuela.
John Briceno, Prime Minister
"Belize and Venezuela, president Maduro and I, on behalf of Venezuela and Belize have agreed on restructuring the PetroCaribe debts which will reduce the amount Belize owns under PetroCaribe by anywhere between BZ 267 million dollars, and 327 million dollars. As I said earlier, we still have to balance the books between Belize and Venezuela. Belize debt to GDP will therefore fall by another 6 to 7 percentage points. At such time that Belize can pay Venezuela, we will pay back this much reduced amount and do so from the date of our new agreement on our original terms provided for under PetroCaribe which is at an interest rate of 2%, with the repayment period of 25 years and a principal moratorium of two years."
"With this restructuring, Belize's debt to Venezuela, this administration will have wiped out, for a second time, more than a quarter of a billion dollars of public debt in a single renegotiation."
"The Central Bank of Belize and the IMF estimate that at the close of this year, 2022, Belize debt to GDP ratio will have been reduce to around, drum roll, to around 63%. You could clap, you know, you could clap. This is less than half of where it stood when we took office two years ago."
And the PM is hoping that that restructure can happen before the end of the year.
LOO Not Impressed With Debt Reduction
But the Leader of the Opposition isn't drinking the Kool-aid. He said that while the debt restructuring may have been necessary, it's compounded with other debts and other loans that the government keeps on borrowing.
Shyne Barrow, Leader of the Opposition
"My instinctive reaction is that whenever we clear these debts in this instance hasn't actually come to fruition, because the payments to Venezuela cannot happen right now, because of the sanctions, so its not as we were paying anyway. But whatever potential debt restructuring will come from Prime Minister's Briceno's meeting with President Maduro, the debt continues to increase. As soon as the relief debt, they spend and they create more debt. If you look at the amount of monies that have been borrowed since this PUP government took office, we're at about half a billion dollars. So when they talk about the Blue Bond restructuring and now the Petrocaribe debt relief, its doesn't add up to the billion dollars that they are talking about and I am certain that by the time we get to next budget it will all even out and what we have to be told is what is happening with the revenues that we are generating, if we are generating revenues. So, this talk of debt relief doesn't necessarily translate into a better quality of life for Belizeans, because this is a fiendish government. They just spend, they are just wildly spending. Now we don't know whether or not that will result in a complete collapse and whether it will result in development, but the point is I don't get excited when I hear about the debt relief negotiations or agreements, because this government is spending wildly, so it really adds up to nothing."
And the media also asked Barrow about his thoughts on the cooperation between Belize and Venezuela, in the light of the US easing up some of its sanctions on Caracas.
Shyne Barrow, Leader of the Opposition
"Again, I don't support dictators and autocratic regimes. I don't support democracies that don't function as democracies, but function as authoritarian regimes and so while I'm quite critical of that, diplomacy and bilateral relations are just that. So, we always have to look at different stakeholders in the bilateral sphere and how these agreements or this negotiation could benefit us. So, I don't want to say that I would not agree to this development with Venezuela, because of my personal beliefs as far as their lack of free and fair elections that have been criticized by all of the free developed nations. Definitely we are grateful for this debt restructuring, but we do have to be careful. I believe in diplomacy - President Biden meets with China, President Biden as you've said they are talking to Venezuela right now. So, I believe diplomacy allows for criticisms of your bilateral partners or your colleagues in the diplomatic arena and it doesn't necessarily mean that you can't do business with them."