Not everyone will agree with State Secretary of Kingdom Relations Alexandra van Huffelen that no pressure was put on the Dutch Caribbean countries to accept conditions for badly needed liquidity support from the Netherlands due to the COVID-19 crisis (see Monday paper). The process of having to meet related demands set mostly by her predecessor Raymond Knops is very much ongoing.
The fact remains that the financial assistance provided helped Curaçao, Aruba and St. Maarten cope with the unprecedented pandemic’s debilitating and lasting impact on their dominant hospitality industries, which are just barely recovering after almost two years. Whether the way it was granted in emergency circumstances bears scrutiny based on international law is a matter of opinion.
More important now for the population seems looking forward and working on strengthening the three islands’ tourism economies as well as their financial households. The latter is easier said than done, with St. Maarten still requesting and receiving zero-interest loans for both the third and fourth quarters of 2022.
The problem is that all these must soon be repaid, making the legally-required balanced budget difficult to attain. Keep in mind that money already had to be borrowed following the onslaught of Category 5 Hurricane Irma in September 2017.
Executing “country packages” of restructuring measures prepared together with the Ministry of Home Affairs and Kingdom Relations BZK in The Hague under supervision of a Caribbean Body for Reform and Development COHO or its alternative recently proposed by the governments in Willemstad, Oranjestad and Philipsburg is to make a positive difference. However, their worsened public debt position has a crippling effect.
Some are calling for debt forgiveness by turning these loans into grants, while others urge refinancing with longer terms. The Kingdom Council of Ministers RMR has so far refused to entertain either, but they may hopefully reconsider.
After all, a “clean fiscal slate” that was supposed to accompany dismantling the Netherlands Antilles per 10-10-10 never fully materialised at least for St. Maarten, be it partly because of local administrative shortcomings. If the young country could somehow lighten the burden of this new, additional “monkey on our collective back” its immediate future would look significantly brighter.
