The UDP Says A Sovereign Default is Imminent

Posted By: Marty

The UDP Says A Sovereign Default is Imminent - 07/26/06 08:11 PM

The UDP Says A Sovereign Default is Imminent

Belize's debt management strategy is government's absolute top priority and today the Opposition held a press conference to unveil documents which they say show that the country is in imminent danger of a sovereign default. That's the worst case scenario for any government and the Leader of the Opposition Dean Barrow says that before it gets to that, the government should call new elections. Sure, the Leader of the Opposition calls for elections very regularly, but today, there was a new urgency to his call and he had documentary evidence to back it up.

Hon. Dean Barrow, UDP Leader
"The government of this country, if there is even an ounce of nationalism left in it, must contemplate calling the general elections well before the constitutionally due date of 2008."

And according to Barrow, government must call elections because he has documents to show that Belize is in imminent danger of a sovereign default.

Hon. Dean Barrow,
"This country, because of the borrowing of the PUP, is heading for a sovereign default."

And Barrow showed internal government documents, basically it is debt re-profiling game plan that point to, he concludes, a selective default.

Hon. Dean Barrow,
"The government will very shortly announce that it is undertaking, what it would please it to call, a debt re-profiling exercise. All that means ladies and gentlemen is that the government will be acknowledging publicly, universally, to all the world, and in particular to its commercial debtors, that the government is unable, over the next few months, to meet its repayment obligations on our national debt."

And to prove it Barrow read directly form those strategy documents.

Hon. Dean Barrow,
"'Bridging the projected residual financing gaps may require some element of debt relief from private sector creditors.' Now ladies and gentlemen no private sector creditors will give you relief voluntarily. What the government is going to do is to confront these creditors with the fact that unless they agree to take less than they are owed, they run the risk of getting absolutely nothing at all because the government will be forced to default.

What it will mean is that you will get some initial relief but you will still have to deal with these bullet payments that start coming due in 2010, I believe it is, and so on. And the fact is going to be that this country will not be able to return to the commercial markets to do business for a foreseeable future. The people of this country need to understand exactly how bad the crisis is and the people of this country have to understand exactly whose fault it is."

And if it is such an unmanageable situation, why is the UDP so eager to take it over? Barrow says, it would be easier for them.

Hon. Dean Barrow,
"What they will have great difficulty in doing, a new government will be able to achieve with a minimum of fuss. If we form the kind of national negotiating team, with respect to the question of the debt, that we know we can, we believe that the way ahead for Belize will be far easier for Belize than it is now under the current administration."

And because of that comparative credibility advantage, Barrow says government must work on a plan basically for a smooth transition of power.

Hon. Dean Barrow,
"So we this morning, alert the nation to what is taking place but furthermore we call on the government, in the context of all that has gone wrong, but particularly because we're now facing this issue of sovereign default, to sit with the Opposition and work out a timetable for accelerated general elections."

And Barrow says he has the team to take over, this morning the UDP was intent on showing itself as a government in waiting, as it showed deputy leader Gaspar Vega, area representatives Patrick Faber and Wilfred Elrington. Vega spoke on the GST, Faber on education and Elrington on Social Security.

Gaspar Vega, UDP Deputy Leader
"The cry of our people is that they cannot take anymore punishment. They are fully aware that for the first time the general public is going to be paying GST, PUP VAT, on a utility like electricity. We believe that GST needs fixing. We will not be following the PUP with loud pledges of abolition. For abolition would be just as harmful, perhaps more harmful to consumers and businesses than it was in 1999. But it needs fixing and we stand ready to work with all Belizeans to design the best fix for when we become the new government."

Hon. Patrick Faber, Area Rep. for Collet
"The recent results of the Primary School Examination (PSE) and the Belize Junior Achievement Test (BJAT), cry shame on the education system of our country. Many are quick to point out that our children are failing us. But it is my belief that, quite to the contrary, it is we who have failed and continue to fail our children.

We sit and watch these results come out year after year and in the words of those from the Ministry, 'we hope that the results from this year will be better than the results from last year.' Well hoping is not enough. We need to get into these schools and find out exactly what the problem is and what the needs are and we need to get it to them at what ever cost."

Wilfred "Sedi" Elrington, UDP Aspirant in Pickstock
"There is recklessness in the use of our funds. There is criminality in the use of funds. There is fraud in the use of our funds. Hundreds of millions of dollars and a few choice Belizeans, notorious people, have most of the money pocketed either in banks here or in banks abroad and we are expected to be respectful to these people, to call some of them Honorable, to pay for their light bill, water bill, their vehicles---it just is a terrible terrible travesty.

The truth is that it is with Prime Minister Musa and Fonseca that the buck stops, nobody else. They were the people in charge. And none of us will delude ourselves by believing that Yasin Shoman and Narda Garcia were in fact responsible for all of this. They are merely little pawns. They are merely the little pawns in a well orchestrated and deliberately executed plan by the PUP to pillage the resources of the SSB so as to enrich their close friends and cronies, and so as to continue to buy the support of the fanatics who continue to support their cause.

We have got to ensure that action is taken through our collective pressure, brought to bear on the government of Belize, to ensure that those people who are wrong, who have pillaged the public purse, who have robbed the poor people, the workers, and the employers must be brought to justice."

And with those strident declarations, Barrow made his pitch to the voters, he feels the UDP is demonstrably a government in waiting.

Hon. Dean Barrow,
"The UDP has the capacity, has the ability, has the talent to form the best government that this country would ever have seen."

A generous pitch, but if the conditions are as dire as the UDP claim, even the best government ever would have a hard time solving all the problems they today catalogued.

And while the UDP preens and preps for what it sees will be an imminent regime change, this regime is still very much in charge and has more than a few outstanding matters to settle.
Posted By: Now Danny

Re: The UDP Says A Sovereign Default is Imminent - 07/27/06 09:41 AM

Very interesting, thanks Marty.
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