Uh oh, here comes the pain!
Belize will miss a coupon payment on about $544 million of bonds and is unlikely to pay creditors during a 30-day grace period that starts today, Finance Secretary Joseph Waight said.Now South America seems to be perpetually in a state of default, however the problem becomes that just about everyone is leveraged to the max. When your debt load is massive, you count on these payments in order to pay your bills. If you're shafted, you also must shaft your investors of payments that they are counting on. This continues until someone is able to pony up the cash to stop the defaults.
The Central American nation, which owes investors about $23 million today, can’t make the payment, Waight said in a phone interview from Belmopan City. The government has been in talks with debt holders about a restructuring, its second since 2007.
“We simply do not have the capacity to make the payment,” Waight said. “We are hoping to engage with creditors as quickly as possible.”