(Adds IMF comment, background)
NEW YORK, Aug 21 (Reuters) - Ratings agency Standard & Poor’s on Tuesday cut its long- and short-term foreign currency sovereign credit ratings on Belize to selective default after the country missed an interest payment on its so-called superbond earlier this week.
“The rating action follows the government of Belize’s failure to pay the $23 million semiannual interest coupon due on Aug. 20, 2012, on its $547 million bond due in 2029,” S&P said in a statement.
“Our recovery rating on Belize’s foreign currency debt is ‘4,’ indicating an estimated post-default recovery of 30 percent to 50 percent.”
Belize’s government has said it has little room to negotiate on restructuring the superbond, and a senior Finance Ministry official said on Monday it was too early to say whether it will pay interest owed to bondholders within a 30-day grace period.
Prime Minister Dean Barrow has said Belize cannot afford to service the $550 million dollar bond, which started with an interest rate of 4.25 percent but steps up this year to 8.5 percent.
The International Monetary Fund (IMF) said Belize has not asked for financial assistance from the lending institution.
“We are following developments in Belize closely and remain in close contact with the authorities with regard to the work by the country’s debt review committee,” an IMF spokesman said in a statement.
Moody’s Investors Service rates Belize at Ca, which is highly speculative. (Reporting by Daniel Bases; Additional reporting by Lesley Wroughton in Washington, Bernard Orr)