That the Committee for Financial Supervision CFT advised allowing the Dutch Caribbean countries to deviate from their budget norms due to the coronavirus threat (see related story) is an important first step, offering them at least some breathing space to cope with the dire socioeconomic effects of this global pandemic. Great care should nevertheless be exercised not to add too much more debt.
After all, St. Maarten has already been receiving liquidity support since Hurricane Irma which must – ultimately – be repaid too. Another badly-needed tranche dating back to 2019 was recently approved in The Hague.
Hopefully a major part of the emergency assistance to be decided on by the Kingdom Council of Ministers today, Friday, will therefore be in the form of grants rather than loans. In that regard it was suggested to also look at reallocating still available means –reportedly about US $200 million – from the post-Irma Recovery Trust Fund administered by the World Bank to help address the current crisis.
With the Central Bank predicting monthly deficits of between NAf. 11 and 14 million plus a decline of up to 29.2 per cent in the 2020 gross domestic product (GDP), there can be little doubt this situation is very serious. Only a strong compensation and stimulus package comparable – on a smaller scale – to those of the US – with a price tag of 2.2 trillion dollars – and of the Netherlands, including Bonaire, St. Eustatius and Saba, will probably do.
The private sector in any case plans to stress how bad things are and how much worse they probably will get if nothing or insufficient is done. There is already a survey underway in cooperation with the St. Maarten Hospitality and Trade Association (SHTA), the St. Maarten Timeshare Association (SMTA), the Indian Merchants Association (IMA), the St. Maarten Marine Trade Association (SMMTA) and the Workers Institute for Organised Labour (WIFOL) to inform the Finance Ministry of their members’ needs.
Let’s face it, these are unprecedented circumstances that nobody would have foreseen when the year started. And extraordinary times call for extraordinary solutions.
