Just when things couldn't get any worse the international rating agency Standard and Poor's yesterday posted a notice on their website warning international investors that the current political situation could further weaken Belize's creditworthiness. It is S and P's opinion that, "growing public frustration is attributable to the failure of the PUP government's economic and financial programs and lack of accountability." Because government is at odds with the labor unions, its decision making has been severely impaired. The report adds that the ongoing utility strikes will impact economic activity which could affect tourism and reduce private investments which would in turn reduce income from taxes.
S&P notes that if the UDP comes to power there would be the increased likelihood of debt restructuring. That according to S&P is unlikely though since government refuses to call elections and even so in S&P's opinion support for the UDP remains modest.
S&P warns that while government has avoided debt default our financial position is still vulnerable. It is a vulnerability exaggerated by the current situation which they estimate could undermine both the economy and social stability leading to a default on the sovereign debt.
