There was good and bad news from the Committee for Financial Supervision CFT in reverse order this past week. First, Finance Minister Perry Geerlings announced he had been advised to reduce the draft 2019 budget by 28 million Antillean guilders (from NAf. 503 million to NAf. 475 million) “at the eleventh hour,” and then came word that the current year’s deficit is about NAf. 65.3 million lower than assumed (NAf. 71.5 million rather than NAf. 136.8 million).
Some may find that seems contradictory, but one has to do with expectations and the other with actual realisation figures. Depending on fourth-quarter results, next year’s budget could also still be adjusted upwards again by amendment later.
All this also reflects the challenges faced in making projections after the widespread devastation caused by Hurricane Irma in September 2017. Estimates understandably had to be conservative, as there was much uncertainty regarding the economy and government revenue as well as cost in the months that followed.
To a certain extent the latter is still the case, so prudence remains the order of the day. Up to and including the third quarter, spending stood at NAf. 353.6 million and income at NAf. 282.1 million. If they both were to continue this year’s exact average until now, during the last three months these final 2018 numbers would end up at respectively NAf. 471.4 million and NAf. 376.1 million, for an extrapolated deficit of NAf. 95.3 million.
The deficit is being covered with liquidity support from the Netherlands of NAf. 32.6 million in July and 32.6 million in November, while a third amount was requested last month. It’s important to keep these – under the circumstances necessary – financial bailouts to a minimum, because although they are soft loans with low interest, grace periods and friendly terms, the money must eventually be paid and there should be no excessive mortgaging of the country’s future.
