There is some good news regarding country’s public finances in today’s paper for a change. The Committee for Financial Supervision CFT confirmed that last year’s deficit turned out to be just 72.2 million Antillean guilders, less than half the anticipated NAf. 153.2 million incorporated into the amended 2017 budget.
The latter does not change the fact that Parliament’s Central Committee this afternoon will continue handling the 2018 budget with a whopping deficit of NAf. 197 million, based on a total expenditure of NAf. 505.5 million and income NAf. 303.4 million. Mind you, that’s still significantly down from the originally estimated NAf. 257 million in the red.
The fact that last year wasn’t quite as bad as expected particularly in terms of losing tax revenues could have positive implications going forward. At the same time, one needs to keep in mind that the devastating impact of Hurricane Irma was only felt during the final four months of 2017, while that will be the case all year in 2018.
Nevertheless, the experience with the 2017 budget does indicate that when economic recovery occurs more quickly than foreseen it can make a considerable difference in the real numbers. Costs were also NAf. 29.9 million lower partly because several policy initiatives had not been realised, so Government may have to take a very critical look at this year’s plans and see what can be scrapped to reduce the 2018 deficit too.
In addition, a proposed package of austerity measures that include reducing the salaries and pensions of Ministers and parliamentarians is to produce a savings of some NAf. 20 million. That still leaves a huge hole in the budget, which can realistically only be addressed by restoring the dominant stayover tourism sector to its previous levels.
This means the now-closed major resorts rebuilding and reopening sooner rather than later, as well as getting the airport back to its former glory. It can’t be said enough: The hospitality industry is St. Maarten’s heartbeat.
