Blue loan agreement adopted | Amandala Journal


BELIZE CITY, Wed October 27, 2021 – Yesterday Prime Minister John Briceño officially presented the Blue Bond Loan Bill to the House of Representatives to initiate the historic purchase, repurchase and cancellation of the so-called Superbond , with a 45% discount for the country – resulting in savings of nearly one billion BZD. (over 700 million BZ dollars).

In early September of this year, the government initially launched a process to solicit the consent of bondholders for a buyout that would be funded through an innovative deal with Nature Conservancy, and to date the government has revealed that 87.4% of bondholders have submitted offers – far more than the qualified majority of 75% needed to make the deal go through.

“This motion, along with a 2021 blue bond loan bill also tabled today, is a decisive first step in my administration’s march towards public debt sustainability,” the Prime Minister said. Briceño in the House.

This agreement, now in its final phase, will provide a loan of up to $ 365,000,000 to the Government of Belize from Belize Blue Investment Company LLC, the organization created by Nature Conservancy to facilitate the disbursement of the loan to the government. .

Prime Minister Briceño explained: “The money to repay the Superbond will come from the Blue Bonds, a funding mechanism created by The Nature Conservancy and their banker Credit Suisse. Belize will access three hundred and sixty-three million US dollars of these bonds for the following purposes: three hundred and one million for the expected redemption of the Super Bond; twenty-four million to pre-finance an endowment account for marine conservation; € 18 million reserved as original issue discount to facilitate a lower interest rate during years of annual repayment; ten million as a debt service reserve account and ten million to help cover the costs of closing the transaction.

According to the Prime Minister, the country will pay an interest rate of around 6% on the Blue Bond loan. This loan is repayable over 9 years, from April 20, 2032, with 18 equal installments semi-annually and a last installment in April 2040.

As a result of this Blue Bond deal, the government will reduce its total debt service spending by US $ 315 million.

As part of this loan agreement, the Government of Belize is to, as mentioned, enter into a conservation fund agreement whereby it will commit to pre-finance an account in the amount of US $ 24 million for marine conservation purposes. The GOB must also meet retention milestones and meet commitments set out in the agreement or be subject to penalties.

“If on a Quarterly Payment Date, the Government of Belize has not met one or more retention milestones within the applicable grace period (each, a ‘retention event’), make a payment equal to $ 250,000 plus an amount equal to $ 50,000 multiplied by the number of custody events that have occurred and are continuing from that quarterly payment date, ”indicates the loan resolution.

A side deal was also made as part of the loan agreement, but details were not provided.

The Leader of the Opposition, the Hon. Patrick Faber and the other opposition members in the House supported the motion but pointed out when they addressed the House that they had not seen certain documents regarding the Blue Loan Agreement and resolutions tabled in the House. Hon. Faber complained that they did not receive all of the documents until the morning the House meeting was to take place and that these documents were still incomplete.

A TNC statement released last week said, “TNC would like to thank the government for its efforts to negotiate conservation commitments that recognize the critical role that the Belize Ocean plays for the Belizean people, their livelihoods and economy in general. We look forward to the results of the bipartite review in the National Assembly and the Senate in the coming days. “

A Senate meeting is scheduled for Thursday, October 28, according to the Belize government press office.

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