This Friday November 10th is the deadline for the Government of Belize to cough up $78.16m as final compensation payment to the former owners of BTL, which was ordered by a ruling of the Caribbean Court of Justice a week ago on November 1st. The ruling specifically ordered that payment be made on or before Friday, so today the media checked with Financial Secretary Joseph Waight to find out whether early payment had been done. He discussed that as well how giving up $78 million in U.S. currency will reduce the country’s much needed reserves.


Screen_Shot_2017-11-08_at_7.53.34_PMJoseph Waight, Financial Secretary


“It has not been made the order from the Caribbean Court was that the payment should be made on or before Friday the tenth and it will be made on or before Friday the tenth it will not be made today possibly tomorrow. It will reduce the reserves by about 20 to 25% remaining after that will be about three months imports that will cover which is fairly comfortable, reserves are built overtime generally from surpluses between your exports and your imports it will take time to rebuild but it’s on a positive direction because the balance on payment is largely on equilibrium some months you are in some months you are out but its largely over the period of time the current account of the balance of payment as it is called, your trade account is largely positive and that will built over time, it will take some time we hope that production remains and prices remains and we have no natural disasters but we don’t use the reserves for the day to day financing of our trade activity the reserves are the reserves.”


Reporter


“Will the country feel any kind of effects for this US$78 million payment that is due by Friday?”


Joseph Waight, Financial Secretary


“Am not sure what you mean by effects, no certainly the balance remaining in the bank will be lower by 78 million dollars but that will not create any shortage or pressure on importers wanting to purchase foreign exchange for the imports because the system is largely in equilibrium and they get that from their commercial banks in any event not from the Central Bank.”


As in most cases, there is a “but”. According to FinSec Belize can withstand the low reserves as long as there are no unforeseen events that could place pressure on Government’s finances.


Joseph Waight, Financial Secretary


“It all depends on the level of your exports how well your tourism is doing, hopefully we don’t have any natural disasters, it depends on the price of oil in the world market because those are big imports, machinery and things so it’s a little difficult so I would figure about two years.”


With the payment of compensation for BTL and struggling economy, Belize’s debt to GDP ratio is now at 100%, which means that every dollar generated is basically earmarked for debt payment.

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