That St. Maarten’s estimated deficit of 223.7 million Netherlands Antillean guilders at the end of 2020 was calculated too high according to the Committee for Financial Supervision CFT (see related story) is in principle good news. It could allow the country to remain within the NAf. 185.5 million ceiling approved by the Kingdom Council of Ministers in The Hague.
Based on the NAf. 133.1 million deficit over the first three quarters of the year that would mean one of NAf. 90.7 million in the last three months, more than double the quarterly average so far, so not a likely scenario. Keep in mind that budget adjustments were made based on new projections for an unprecedented coronavirus-related crisis.
CFT stated in its letter that out of the NAf. 58.7 million earmarked for monthly payroll and income support only NAf. 27 million had been used, mostly because of delays in execution with applications for September and in some cases August still pending. It could mean fewer companies needing wage subsidy or perhaps less urgently than expected, but also many having gone under altogether, in certain cases unable to qualify for whatever reason.
Income during the first three quarters was NAf. 14.4 million higher than foreseen, while expenses remained NAf. 16.7 million lower for personnel – mainly because vacancies were not filled – and NAf. 23.2 million lower for goods and services.
But these better-than-feared figures should not fool anyone into thinking things are not as bad as they seem. Prime Minister Silveria Jacobs mentioned in Wednesday’s press briefing that government revenues were down about 50 per cent.
No matter how you look at it, the private sector still standing will continue to require assistance to prevent widespread business closures and mass dismissals for now. Even if the upcoming stayover tourism season were to exceed all reasonable expectations in terms of earnings and jobs, it would take some time before the benefits of such trickle down into all segments of society and the national treasury, while cruise tourism is yet to resume.
Consequently, talks with the Netherlands on more liquidity loans continue to be a priority, despite far-reaching conditions. Under the current circumstances that appears to be the only realistic chance at a true recovery.
