The Government of Belize has reached a benchmark settlement with Ashcroft’s business interests over the 2009 nationalization of Belize Telemedia Limited (BTL).
But the Belize Communication Workers Union (BCWU) whose members have shares in the company have condemned the settlement and expressed the view that Prime Minister Dean Barrow is not revealing the whole truth.
Barrow announced the electrifying news on Monday, September 14, of a mutually agreed settlement over BTL . He said that the dispute, which had become a complex web of diverse interests due to the litigation, which followed nationalization six years ago, has been settled at a cost of Bz $162.7 million.
There are two parts to the settlement.
The first part involves a mortgage debenture which British Caribbean Bank has agreed to accept.
BTL will be responsible for paying the principal and interest on this mortgage debenture. .
This payment is to cover a loan which the directors of BTLhad made with British Caribbean Bank before the company was nationalized. .
The original loan was for US $22.5 million, but it was never paid because when the Government of Belize stepped in to nationalize the company, the retiring directors of BTL declined responsibility for the debt. .
The new directors of BTL refused to honour the debt because they argued the loan had been illegally contracted, and the company, BTL, had not seen any benefits comensurate with the amount of money borrowed.
That loan with British Caribbean Bank was structured in such a way that if it ever came into arrears, the interest on the amount payable would be 16 percent per annum.
During six years of non-payment, the interest on this loan, compounded, has risen to some $72 million.
. The Government of Belize decided it was time to settle after the Caribbean Court of Justice ruled that Belize as the new owners of BTL, was bound by law to respect the loan contract made by the previous directors of the company.
In the second part of the settlement, the Prime Minister revealed that his government has offered, and the Ashcroft interests have agreed to accept payment amounting to BZ $65.3 million for the acquired shares in BTL.
Prime Minister Barrow explained that the value of the shares is the subject of another arbitration not yet complete. GOB has determined the shares are worth US 72 cents each or BZ $1.44 per share, while the Ashcroft camp has placed the value at Bz. $10 a share.
The Prime Minister has said that if the arbitration tribunal declares that the shares are worth more than $1.44 per share, the Government of Belize would pay the difference. .
He conceded that GOB could potentially pay substantially more if the tribunal were to rule that the shares are worth more, though he didn’t expect to see much if any variance.
The settlement, as explained by the Prime Minister has received wide and enthusiastic support in Belize, but the Belize Communication Workers Union, hours later issued a tart and rambling rejection.
It expressed resentment at the fact that the negotiations were carried out in secret and the union was not consulted.
It criticized what it called “the significantly high cost of the settlement”, and suggested that there is a secret side to the agreement which the Prime Minister has not disclosed.
It further speculated that “campaign financing” had somehow influenced the outcome.
The union statement concluded: “Now we know for certain that there is no difference between the PUP and the UDP. Both Musa and Barrow have failed us, and now we are forced towonder all over again if we ‘change monkey fu black dog”.
With last week’s framework agreement now in place, the case has been withdrawn from the aribbean Court of Justice.
The BTL dispute was expected to come up for hearing before the CCJ at the October 2015 sessions of the Court. The settlement is regarded as a big win for the Barrow administration as the prospect of early general elections looms imminent.