Moody's boosts Belize

Moody's Investors Service said it upgraded the long-term local- and foreign-currency issuer ratings of the government of Belize to Caa2 from Caa3.

“The upgrade reflects the reduction in the debt/GDP ratio following the buyback of the ‘superbond’ in November 2021, and Moody's expectation of a further reduction supported by a balanced primary budget going forward. Under the terms of a loan incurred to buy back the ‘superbond’ debt affordability benefits from lower interest payments until 2026 as compared with scheduled interest payments before the restructuring, thereby supporting Belize's fiscal strength assessment,” the agency said in a press release.

Belize's debt/GDP ratio retreated to 82.3% of GDP in 2021 from 104.5% in 2020 after the buyback of the $556 million superbond at 55 cents on the dollar in November 2021. Under the terms of the $364 million blue bond incurred to buy back the superbond, Belize got lower interest payments as a share of revenue and a substantial maturity extension that supports its fiscal strength assessment, Moody’s said.

Additionally, the agency said it forecasts the debt/GDP ratio to decline further and converge toward 72% of GDP in 2023.

The outlook is stable.

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