Government has some major bond bullet payments to meet in 2006 and the Taiwanese are going to help them do it. That's what most of a US$25 million loan is going to be used for. Today Prime Minister and Minister of Finance Said Musa went to the National Assembly seeking authorization to enter into the 20-year agreement with Taiwan. In justifying the new debt, he told the House that like many small economies, Belize is under major pressure due to external factors. It's a tidy explanation but one that didn't quite wash with the Opposition. Here's the tempestuous back and forth on that issue.
Rt. Hon. Said Musa, Prime Minister
"Belize like many other small oil importing countries is experiencing strong pressures on external payments due to a combination of record high prices of imported petroleum products, high external debt service commitments, and continued erosion of prices of traditional agricultural exports. In this regard our friend, the Government of the Republic of China, Taiwan, has agreed to increase its level of economic support to Belize and has further agreed to assist us with a rapidly disbursing low interest long term loan in the amount of US$25 million. Such funds will assist greatly in meeting the interest and amortization payments due in 2006 on all our international bonds."
Hon. John Saldivar, Cayo South Area Rep.
"The Prime Minister has just gotten up and in his usual style, try to blame everything else but his government's mismanagement and corruption for the external crisis that we have with our balance of payments. Madam Speaker as the Prime Minister describes the Republic of China as a friend, I don't know if under these circumstances I can continue to consider the Republic of China to be a friend. I say this Madam Speaker because I am reminded of when someone in our family is addicted perhaps to crack or some drug. We are always told not to give them money or anything that will help for them to further their habit. This government has a habit. This government has a problem with money. It spends what it doesn't have and it burdens this and future generations with debt after debt after debt after debt. Personally I need to express my frustration with a government that says it is a friend of Belize that continues to give this government the crack that it needs to keep its habit going and I cannot, Madam Speaker, continue to consider the Republic of China to be a friend of the Belizean people."
Hon. Dean Barrow, Opposition Leader
"We are borrowing monies to repay monies that we have borrowed before. This is not a loan for development purposes. This is not a project loan. This is not a loan to improve conditions on the southside of Belize City. This is not a loan for poverty alleviation in the Toledo District. This is not a loan to help single mothers. This is a loan to enable us to meet our payments on the loan, the mountain of loans, that we have made before. Please Madam Speaker, the Belizean public needs to be grapple with that fact; we're now borrowing in order to repay what we borrowed before. We're digging a hole to fill a hole. This government has a problem.
No other bilateral lender, no other country in the international community will lend Belize money because it is clear to the international community, it is clear to the world, that Belize is no longer credit worthy and that borrowings that we seek to continue to do are unsustainable because of the fact that our external debt is now almost $2.5 billion. The only source in the world to which we can possibly turn to get this kind of money is Taiwan. Pretty much all the CARICOM countries have switched relations from Taiwan to the Republic of China. This government can't, I'm not saying that that is a good thing or that that is a bad thing but there must be reasons why every single CARICOM country has decided to switch; every single or almost every single. The majority of CARICOM countries have switched: Jamaica, Trinidad, Dominica. They cannot switch Madam Speaker, they cannot switch because they have to be the petitioners and supplicants that prey on the fact that Taiwan is so increasingly isolated that it must pay to try and keep the few countries that are still within its orbit in place. Even if Taiwan acknowledges that it is like giving crack to an addict, Taiwan has no choice because, as I said Madam Speaker, Taiwan is in desperate need of continued diplomatic support and this government in effect is selling its diplomatic support."
Rt. Hon. Said Musa,
"To use a Belizean expression, they sucked up to Taiwan. They were sucking up to Taiwan 1993 to 1998. So when the going was good for the UDP government, Taiwan was great. Taiwan was so great that Taiwan loaned them, loaned the Government of Belize under the UDP administration, as the member for Collet preempted me saying, $50 million. Now that Taiwan is helping us with another $50 million to strengthen our reserves and to ensure that we can meet our debt obligations, and yes it is to pay commercial debt that will become due in 2006, the bonds, we make no secret of that. But Madam Speaker we should be grateful to this government, to these people. Instead we're hearing a lot of sour grapes today like they are 'bex' because PUP has been able to secure this loan. I mean what kind of responsible opposition is this Madam Speaker when they will display this kind of very...yeah its very lowdown and petty the way they speak of Taiwan simply because Taiwan is helping Belize."
This US$25 million will be joined to another grant of US$15 million, also from the Taiwanese for financing support. That money will be kept in a special account for the management of external debt.
