In other news from the financial sector, the Minister of State in the Ministry of Finance Chris Coye yesterday heartily defended Social Security's decision to invest 28 million dollars in a public administration campus next door to the Eleanor Hall Building in Belize City.
The opposition has criticized the investment as fleecing of the social security fund - but Lester, Minister of State Coye said the investment is necessary, and as safe as church:
Chris Coye, Min. of State, Ministry of Finance
"The Social Security has over 160 million dollars, 40 million in CDs and 120 million in cash. Not basically earning anything. 40 million in CDs, maybe that's earning 2 percent, call it two and a half percent."
"The cash is earning 1 percent, it's great. What this investment offers is a safe investment opportunity for Social Security Board. So in this instance, the government will rent the two buildings for the full life or beyond the life of the debt itself, which means that it will fully cover all debt servicing costs for the full life of the transaction."
"So it is a risk free transaction. Let us help the Social Security by improving investment opportunities for them. Look at the investments that they have made, the examples of equity investments, BTL. What is the return on investment in BTL? Overpaid for their investment and so the rate of return on their investment is 2.6 percent. So that investment is hardly better than an investment in a CD, hardly better than an investment in a CD, probably more risky than an investment in a CD."
"You can't get a better or lower risk investment than this and this will earn you, if you do it by debt, 5.5 percent, if you do it by equity and SSB is the only one, as much as 10 percent return on that investment."
