THE MUSA ADMINISTRATION HAS SEEN THE MORE THAN DOUBLING OF THE NATIONAL DEBT SINCE IT CAME INTO OFFICE - BUT WHATEVER THE NATIONAL DEBT FIGURE IS, YOU HAVEN'T SEEN ANYTHING YET, BECAUSE GOVERNMENT IS READYING TO MAKE ITS BIGGEST LOAN EVER. CHIEF OF STAFF IN THE PRIME MINISTER'S OFFICE FRANCIS FONSECA TODAY CONFIRMED THAT THERE IS A PROPOSAL TO RAISE 125 MILLION US DOLLARS FOR THE GOVERNMENT OF BELIZE - THROUGH A BOND ISSUE FROM BEARS STEARNS AND COMPANY, A NEW YORK INVESTMENT CONSULTANCY. WHAT'S A BOND ISSUE? - WELL, LIKE A LOAN, IT'S MONEY YOU HAVE TO PAY BACK. BUT CHIEF OF STAFF FONSECA STRESSES THAT THE STAGGERING QUARTER BILLION BELIZE DOLLARS WON'T COMPOUND BELIZE'S NATIONAL DEBT BECAUSE IT WILL BE USED TO PAY OFF EXISTING DEBT AT LOWER INTEREST RATES. ACCORDING TO FONSECA THE TERMS WILL BE BETWEEN 9 AND 10 AND A QUARTER PERCENT - WHICH WOULD BE USED TO FINANCE VERY EXPENSIVE DEBT ACCUMULATED AT, WE ESTIMATE, CLOSE TO 13%. FONSECA STRESSES THAT IT'S ONLY A PROPOSAL THAT IS PRESENTLY BEING REVIEWED BY TECHNICAL PERSONELL. AFTER THAT REVIEW IT WILL BE PRESENTED TO CABINET AND THEN TABLED IN THE HOUSE OF REPRESENTATIVES. AND WHILE ALL THAT'S THE UPSIDE TO THE SINGLE BIGGEST LOAN THIS OCUNTRY HAS EVER MADE - THE SHARP DOWNSIDE IS THAT IT ILLUSTRATES THAT DEBT HAS NOW BECOME SO UMNANAGEABLE AND SO EXPENSIVE THAT THE COUNTRY IS FORCED TO TAKE ON NEW DEBT JUST TO GET RID OF IT. AND WHAT IS THAT DEBT? WELL UNOFFICIAL ESTIMATES PLACE IT AT UPWARDS OF 1.5 BILLION DOLLARS - INCLUDING SECURITIZATION AND STATUTORY DEBT. OF COURSE, THE GREATEST CONCERN WITH ANY GOVERNMENT THAT GETS 250 MILLION DOLLARS A YEAR BEFORE ELECTION IS THAT THE STATED PRIORTITY OF REFINANCING EXISTING DEBT - CAN EASILY BE FORGOTTEN AS GOVERNMENT PRIORITIZES THE MONEY FOR USE IN ELECTIONEERING DRIVES AND PORK BARRELL PROJECTS. THERE'S NO SAYING IF THAT WILL HAPPEN, BUT CERTAINLY THAT'S WHAT CAN HAPPEN - WHEN 9 FIGURES ARE IN CIRCULATION.... ENDS....

Tags Francis Fonseca Belize