Last night in the news, we told you how the Committee representing Belize’s bondholders rejected the terms of the Government’s first offer to restructure the Superbond a third time.
The Bondholders are not interested in the consent solicitation offer because they say that the current proposed deal would, quote, “crystalize a further reduction in the net present value of the Bonds in excess of 40%, in addition to a cumulative reduction of more than 50% already provided by bondholders in restructurings of predecessor instruments to the Bonds in 2007 and 2013.†End quote
We heard from the Committee spokesperson and the Leader of the Opposition, but how does the Government view this response? Well, that’s what we asked Dr. Carla Barnett, the Minister of State in the Ministry of Finance. She told us that in this type of negotiations, the refusal of the first offer is to be expected:
Hon. Dr. Carla Barnett - Minister of State, Finance
"Let me just say it is hardly the case that a first offer is accepted. Clearly there's going to be ongoing conversation and then we'll see how we can reach some sort of resolution."
Daniel Ortiz
"Is it ever a situation or is there any concern that maybe the bondholders will stick to getting the government to keep these 2038 bonds?"
Hon. Dr. Carla Barnett
"I wouldn't say so the conversation has already begun that is why they ended up at the table so there is a conversation that's on going and you would understand this. If you're negotiating a deal you don't - the first offer is the first offer, you counter offer and you say what else you need in terms of information and then the discussion continues. So we're looking forward to the next step."
Daniel Ortiz
"So you're expecting a counter offer sometime soon or government expecting a counter offer?"
Hon. Dr. Carla Barnett
"I don't know that government is expecting a counter offer, I think what the press release that we all saw yesterday said was they were asking for some more information which I'm not involved in the day to day negotiating process but I know that those questions are being answered and we'll take it from there."
Daniel Ortiz
"Do you know if there is any sort of threshold that the government? Okay so this is a first offer, is there any threshold which the government maybe considering okay we have it as a peg at this. We go with this first offer but we can't go any higher than this or lower than this."
Hon. Dr. Carla Barnett
"I wouldn't want to hazard that; I would only say that the negotiations continue."
Daniel Ortiz
"Is it a consideration that the government or the ministry you form a part of is considering that the bond holders will expect the Belizeans and the taxpayers to share some of the pain if there must be some sort of relief given?"
Hon. Dr. Carla Barnett
"Relief to?"
Daniel Ortiz
"In terms of this restructuring effort?"
Hon. Dr. Carla Barnett
“I think what we all want is a situation as I said where we are seen to be putting ourselves on a path of stability and on a path of growth. We’ve seen growth come down, we have to fix that, we have to get the economy moving again we’ve begun to see good changes but we need to build on that and we need as well to show when we do our budget that we are looking to reduce our fiscal deficit.â€
Reporter
“Do we have a contingency for the February payment in interest that we know is coming up?â€
Hon. Dr. Carla Barnett
“I wouldn’t want to answer that at all because we are in the conversation with the bondholders.â€
The government’s offer expires in 8 days – and talks are expected to continue up until that time.
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