If Belize's US $225 million bond offering was critical last week, well this week it's on life support, and Moody's investor service may Be the one to pull the plug.
Reuters News Agency today reported that Moody's is considering cutting Belize's ratings because, "Belize's recent economic policy would not assure future debt sustainability." Moody's analysts cite an increase in Belize's debt burden has led to deterioration in the country's credit indicators. With that, Moody's has placed on review Belize's "Ba3" foreign currency rating for Belize's bonds and notes. This is truly grim news for Belize's debt position, which was depending greatly on a successful bond issue for some relief. This latest blow comes after a very lukewarm initial response from international markets when Finance and Tourism Ministers Hon. Ralph Fonseca and Hon. Mark Espat went on a European Tour to float the bond.
In today's Amandala, Finance Minister Fonseca is quoted as saying that he gives the bond until the end of the fiscal year in March of 2005. During that time, Belize has pressing debt commitments to meet. As for the capital spending, Fonseca told the Amandala that if necessary government will get that money from treasury bills and through its Central Bank overdraft.