BSI - Belize Sugar Industries - the company that takes in and processes all the sugar cane produced in Belize at the Tower Hill Factory is in a financial crisis.
The company did not have the three million dollars to make the third payment to Cane Farmers on Monday of this week - and there is no indication of when this will happen.
That has left cane formers critically short of cash to prepare for the upcoming season which starts harvesting in mid-December.
And while that is a critical problem for hundreds of farm
So while the farmers may be able to scrape things together - even if they do - the factory may not be able to accommodate them.
The problem is financing - BSI needs 20 million dollars just to get back up to speed. Social Security has committed ten million but the sugar producer is so tied up in financial knots with its last financier - which is the ING group - that it cannot free up the collateral to access those funds.
The burning issue was discussed in the House Of Representatives today where - in a rare spirit of bi partisanship - the Prime Minister indicated that he'd called the leader of the opposition on it - and if necessary they'll go "hand in hand" to international friends to seek help for the ailing industry.
We asked the PM, is BSI too big to fail?:
Jules Vasquez
"Because as you outline it, if you can't pay the 3rd payment you can't start again, you can't start up."
Prime Minister Dean Barrow
"I am indicating that if the commercial arrangements don't work then the government will have to see if there's any way if any of our partner countries might agree on some method of financing. How that would work in terms of the ownership and management of BSI I am yet to figure out and yet to even look at because I am not even sure if we are at the stage where I will activate the notion that I have that I should try to reach out to bilateral partners. If BSI is able to produce the replace financial arrangements then game set and match. The situation in terms of the replacement financing is not without hope but I think people have to be told how serious things are because as I said to focus only on the 3rd payment which is due and which the farmers have a right to expect misses the larger picture."
Jules Vasquez
"Is that the case with BSI? Are they too big to fail?"
Prime Minister Dean Barrow
"Well notionally but practically speaking that can't be, we don't have the kind of resources that United States possesses in terms of bailing out the banks. I don't want to give a figure, but with respect to paying off the old loans as well as finding new working capital, you are talking about a huge sum of money. Remember that we have a 1 billion super bond debt that we inherited, you have people such as Michael Ashcroft going all the world trying to trigger a default, trying to say that arbitration events and so on constitute the basis for a default. Who in hell is going to lend us any serious money commercially? That's not on. So even if we wanted to go that route, it would not be possible in the circumstances. The only option that could conceivably be left us is as I said trying to deal with bilateral partners."
The Prime Minister also indicated that the IDB may be able to provide limited funding…
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