The suggestion by Central Bank of Curaçao and St. Maarten (CBCS) President Director Richard Doornbosch to swap the Dutch Caribbean COVID-19 debts to the Netherlands for investments in climate resistance (see Monday newspaper) is noteworthy. Similar proposals for their own foreign debts have recently been made from elsewhere the region, including Barbados.
Former Antillean Minister and Curaçao Commissioner Frank Willem wrote an interesting letter about the issue published in the same edition’s opinion pages. He says that while the concept holds significant promise, it also poses critical questions about the obligations of beneficiary countries and how they can fulfil their responsibilities to citizens.
Many in St. Maarten, including former Member of Parliament (MP) George Pantophlet, have argued for simply forgiving the coronavirus crisis liquidity support loans because needing to repay these is hampering the country in its development. There has not been much support for this idea in The Hague, but considering an acknowledged joint responsibility to protect the entire kingdom against the effects of climate change, the recommendation by Doorbosch may have a better chance to get enough political support.
Funds can be redirected toward renewable energy projects, coastal protection, infrastructure strengthening, mitigation efforts, disaster preparedness and other related measures. This offers a potentially win-win solution, particularly for countries most vulnerable to climate change.
Just like projects executed with means from the Dutch-sponsored Post-Hurricane Irma Trust Fund administered by the World Bank, stringent requirements and close scrutiny to ensure accountability will no doubt be involved, in this case to lender the Netherlands. Also keeping in mind the relevant experience and expertise available there particularly in connection with a threat to the islands of rising sea levels, that might not be such a bad thing.
It seems like something perhaps worth considering.
