By agreeing to compensate up to 80 per cent of the payroll for companies that see their earnings drop by more than 20 per cent due to the COVID-19 crisis, St. Maarten is preventing business closures and mass layoffs. That is better than only trying to help people “at risk of” or already being dismissed.
It also goes a long way to accommodate what employers’ organisations and the biggest hospitality industry labour union asked. They had called for the same kind of across-the-board support, be it 90 per cent, to keep the private sector and by extension government’s main income source afloat during at least the second quarter.
Whether that will suffice remains to be seen because things probably won’t be quite back to normal by July. A nine-month scenario has been made, but what’s now been presented with a price tag of NAf 254 million is certainly a good start under the circumstances,
That is the amount requested from the Dutch government as grant. Curaçao asked for NAf 760 million and Aruba for Afl 800 million to execute comparable relief programmes. However, the Committee for Financial Supervision CFT has officially advised to leave it at the NAf 52.4 million for St. Maarten in already approved liquidity support minus 3 million euros for the island’s detainees in the Netherlands. The reasoning is that with a monthly public expenditure of NAf 40 million, that should be enough for April and May.
CFT also recommended giving Curaçao two-year loans of NAf 105 million for April and NAf 72 million for May, while its Aruban counterpart CAFT proposed a two-year loan of Afl 42.8 million for that island plus an advance on liquidity support.
The Dutch Caribbean members of these two bodies have distanced themselves from the advice they claim was largely drawn up by the chairman and representative of the Netherlands. They suggested any financing that would take the three Caribbean countries to a debt ratio beyond 40 per cent of their Gross Domestic Product (GDP) be converted into grants.
The Kingdom Council of Ministers is meeting in The Hague a day earlier than usual due to Good Friday and this matter will no doubt be discussed. It’s important to keep in mind that what the Dutch Caribbean governments want to offer their people is very similar to what is being provided in the Netherlands, no less, no more.
At the end of the day these are all Dutch citizens.
