Dutch caretaker State Secretary of Kingdom Relations Alexandra van Huffelen confirmed that a Multiyear Economic Framework will be part of refinancing agreements for the COVID-19 liquidity support loans (see Wednesday paper) of Curaçao, Aruba and St. Maarten that expire on October 10. It regards funds to make their economies more resilient.
That is in principle good news for St. Maarten, because it would allow investments for which own means are currently often lacking. However, a word of caution seems in order.
The approach here should be well-balanced in the sense that efforts to raise government income – for example, by enhancing fiscal compliance – are equally combined with steps that truly and tangibly stimulate business to produce the necessary revenues. What the local private sector does not need is an increase in its collective burden and operational cost without concrete, decisive action that can actually help create more earnings – like, for example, aggressive tourism marketing and promotion.
The country’s recovery from the pandemic and before that Hurricane Irma is still fragile, so there remains little room for additional expenses. If government must again borrow money, this should be for mostly productive rather than consumptive goals.
Otherwise, it will merely add to the already crippling national debt and further mortgage people’s future.
