Governor Eugene Holiday (at podium) delivering his remarks during the opening of the new Parliamentary year on Tuesday.
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PHILIPSBURG--The new Parliamentary year 2021-2022 opened on Tuesday with Governor Eugene Holiday outlining some of government’s plans for the various sectors.
Holiday said preliminary estimates indicate that the economy is expected to grow by four per cent in 2021, leaving a substantial amount of ground to cover to get back to pre-pandemic levels of economic activity. Government is therefore committed to executing its governing programme aimed at stimulating sustainable economic development, he said.
Given the importance of travel for the country’s tourism-based economy, government has and will continue to implement measures to facilitate travel and economic activity.
To welcome tourists back to the island, government together with the airport has, in addition to the safety protocols, established COVID-19 travel screening guidelines through its electronic health authorisation system. It includes required negative COVID-19 tests to enable tourists to visit the island safely. Government also has worked with the airport to set up a testing site at the airport to help guide safe travel.
By extension, government has, via the Netherlands, also signed on to the European Digital COVID Certificate programme, also referred to as the European vaccination certificate. The Digital COVID Certificate, which took effect on September 1, 2021, is intended to allow certificate-holders to travel more easily within the participating countries and to participate in social and economic activities.
Government is also working on the implementation of its Digital Transformation Project. The grant agreement for the Digital Transformation Project under the Trust Fund was signed in March 2021.
Important elements of the digitisation initiatives are the introduction of a Digital Identity for citizens to allow for accurate identification when conducting business with government; the introduction of a new financial management system, including online billing and payment services; and the automation of business processes for various departments, including the introduction of online applications and digital receipt of products.
Government will also continue to promote the upgrade of the digital infrastructure and foster the development of digital business and skills. The COVID-19 pandemic has underscored the value of digitisation for economic activity. Building and developing the country’s digital economy will offer new opportunities and function as an important facilitator of the tourism sector.
“Government will therefore continue to work with telecom provider TelEm to facilitate the realisation of the island-wide fibre-optic network. This investment is critical to better support the online platforms of our schools, of our health care sector, of our banks, and of our hospitality sector such as hotels, Airbnb, restaurants and car rentals. Its implementation will provide the backbone to power our social and economic development in the digital age,” Holiday noted.
He said the need for improved digital infrastructure for education became even more evident during the pandemic. “Government will therefore continue to invest in the upgrading of our education infrastructure and systems to meet the needs of the digital age. The results of the recently-conducted education review as part of the implementation agenda will serve as an important input in that regard.”
Government has also developed and established several policies to guide the safe delivery of education, including the Education Continuity Plan, which has been implemented to guide the delivery of quality education during the various phases of the pandemic. Government is also currently developing a Distance Learning Policy to further enhance this mode of education delivery.
Several programmes financed through the Trust Fund were also initiated.
Sports
The current situation has hampered the execution of sports, with a slow return to sports in 2021. Focus has therefore been on research, development of concepts and repair of community courts, including sport facilities and gyms at schools. In 2022, the intention is to develop policy areas relating to sport continuity, sport psychology, physical rehabilitation, and the development of elite athletes.
For the coming years, government will implement the finalised and updated Integrated Youth Policy with a focus on youth mainstreaming. This is a two-fold strategy for pursuing youth development. It involves ensuring that youth and their interests are reflected in policy on an inter-ministerial level, thus ensuring that there are specific projects addressing youth.
Specific projects include a Safety Net Policy to establish standards to safeguard and protect children by youth organisations and the ongoing updating of the minimum standards for day-care and early-stimulation centres, as a collaborative effort in consultation with key stakeholders in the Dutch Kingdom as well as in the Caribbean region.
Culture
Government believes that culture can be a vehicle in the development and diversification of the tourism product. The partnership with the St. Maarten National Commission for the United Nations Educational, Scientific and Cultural Organization (UNESCO) on the level of the four-country Kingdom Platform is useful in this regard. The collaboration focuses on implementation of the national agenda, specifically on the promotion and preservation of St. Maarten’s heritage and culture.
Tourism
Given the economy’s high dependence on the tourism industry, attracting tourists remains the cornerstone of government’s economic recovery agenda for the coming year.
Despite the COVID-19 pandemic there have been positive signs during the past few months, such as the expansion of schedules by airlines, and the (re)opening of various small and medium-size enterprises and large hotels in the hospitality sector. Government has worked closely with the port to restart cruise calls to the island. The successful introduction of homeporting in June and the return of transit cruise calls in the beginning of July have resulted in welcome business activity on the island.
According to Holiday, going forward, government intends to expand homeporting to increase cruise visitors and create spin-off stayover tourists. Steps were also taken to address corporate governance at the airport and work on the airport terminal is due to start soon, following the recent awarding of the work to the contractor.
Holiday underscored the importance of these plans going hand-in-hand with an increase in private investment. “Government therefore aims to complete a baseline study to improve the entrepreneurial and investment climate in St. Maarten. This is critical, given that it is the private sector which functions as the catalyst for diversification and growth.”
Several policy initiatives were introduced, including the digitalisation of the business licence processes to reduce processing time; the promotion of agri-tourism; the launch of the Enterprise Recovery Programme with the issuance of more than US $7 million in small business loans; and the allocation of NAf. 50,000 to Qredits to support additional administration cost for small and medium-size enterprise loan requests.
Government is also preparing a consistent and sustainable policy for the spatial development of St. Maarten. Proposals have been prepared for three main pillars: economic, social and environment. It is the intention that this process will be followed to establish a spatial development strategy for the coming 10 years.
Government is in discussion with St. Maarten Housing and Development Foundation with regard to developing social and affordable housing and restructuring of the subsidy programme.
The first Nature Policy Plan St. Maarten was recently approved and placed on public review. Government will continue to invest in the improvement of the management of waste in the coming year as part of its environmental reforms. Important programmes in this regard are the expansion of the sewage collection network in Dutch Quarter, in Philipsburg West and in Cole Bay, and the development and implementation of the Sustainable Solid Waste Management Strategy.
The plan is to establish an island-wide Sustainable Solid Waste Management System. It includes a Solid Waste Authority that will be responsible for all elements of the solid waste management system, such as the introduction of tariffs and the collection of fees in the coming two years. This project is being financed through the Trust Fund.
Justice
Investing in the further strengthening of law enforcement is a fundamental element of government’s sustainable development agenda. Government wants to further strengthen the justice system. In the coming period it intends to establish the required function books for the employees of the justice ministry; introduce a knowledge-based and learning organisation for uniformed personnel; and amend the national ordinance on government’s structure LIOL to include the Court of Guardianship, among other things.
Government as part of its law enforcement agenda will also focus on the start of the first phase of the construction of a new multifunctional detention facility in Pointe Blanche; the development of the project organisation of the Crime Fund;
the implementation of the Electronic Monitoring Programme to support rehabilitation of detainees; and the development of Victim Support Services.
Holiday said the realisation of government’s agenda requires financing. The COVID-19 pandemic has presented government with major financial challenges in that regard. Government revenues are down 30 per cent and the budget deficit will amount to a little under NAf. 241 million for the year 2021 and to NAf. 160 million in 2022.
To cushion the impact of the decline in economic activities, the government pursued an expansionary fiscal policy, such as the payroll and income support programme. Overall government has borrowed and received six tranches totalling NAf. 253.9 million in liquidity support from the Dutch Government. This has led to an increase in the debt-to-GDP (gross domestic product) ratio to about 64.7 per cent and current projections show that government will only achieve a balanced budget in 2025.
Given the projected shortfalls, government will continue to work with the Netherlands to secure funding to help implement its structural reform agenda.
To address its budget deficits government’s financial strategy is aimed at building financial resilience through sustainable public finances. To limit the budget shortfalls for 2022 and beyond Government is undertaking several financial reforms to reduce expenses and increase revenues.
