PM Barrow Update on Superbond The Superbond is "t

PM Barrow Update on Superbond

The Superbond is "the rock blocking the drilling" in Belize. The previous administration accumulated numerous short term high interest debts spent on who knows what, and these debts have been aggregated into a superbond which PM Barrow is now attempting to renegotiate.

He's playing it smart by skipping the interest payment and giving the middle finger to the bond holders. What are they going to do? Act indignant and cry about it? There is nothing they can do to him and they know it. Downgrade their bonds? They are already the worst sovereign debt on the market.

If you give someone nothing to lose, they have everything to gain.

Expect the GOB to keep all revenue producing activities, including TECO, to remain mum until this issue is cleared up.

If the TECO shareholders think they have things bad, at least they are not the bondholders who are about to take a bath on the principle.

http://www.reuters.com/article/2012/08/22/bel...DD20120822

"

In response to the missed payment, Standard & Poor's cut Belize's foreign currency sovereign credit ratings to selective default and estimated bondholders would recover 30 to 50 percent of principal on the bonds.

Moody's changed the outlook on Belize's ratings to negative and said investors would probably have to absorb losses of 70 to 80 percent in net present value terms."

From this mornings press conference ...

http://www.lovefm.com/local_news.php?item=684

“We are certain that we can reach an agreement with our creditors.  It is our sense, following the comments of the principals on an almost daily basis, that there is a clear recognition on the part of our creditors that debt relief for Belize is a sure thing, unavoidable and is going to happen.  So we are in fact, in my view, only talking about degree.   The last comment that I saw from Mr. AJ Mediratta, who seems to be a mover and a shaker in so far as the credit committee is concerned, seems to go so far as to concede that the debt relief must contain an element of principle reduction and perhaps I’m teasing a little bit more out of his remarks than the bare language might immediately appear to sustain but the creditors are sophisticated people, they are experienced investors, they know how scenarios change with respect to this whole field of sovereign debt and I believe at bottom perfectly understand the case for Belize.”