It was reassuring to hear at Wednesday’s press briefing that relief on local fuel prices announced by Minister of Tourism, Economic Affairs, Transport and Telecommunication (TEATT) Roger Lawrence is still in process (see related story), despite his not being present. Finance Minister Ardwell Irion did say they are looking at – on the other hand – compensating for related loss of revenue in excise duties, estimated at 14 per cent.
He has a point. This is necessary not just so government is able to keep meeting its commitments, but also to comply with the budget deficit approved by the Kingdom Council of Ministers RMR in The Hague on advice of the Committee for Financial Supervision CFT.
Prime Minister Silveria Jacobs stated that although the tourism economy has been picking up, this year’s hurricane season is fast approaching and the risk of requiring additional liquidity support from the Netherlands later remains real. Honouring agreements made with the Netherlands in this sense, unless certain conditions can be renegotiated, therefore also seems the prudent thing to do.
Irion did not say what income-generating steps have been identified, only that “the small man” would not be hurt. While that sounds nice, the general “cost of doing business” on the island is a legitimate concern as well.
Jacobs for her part mentioned “options where St. Maarten has been missing out” and tied it to talks about the 12.5 per cent reduction in (semi-) public sector benefits, which basically means that to eliminate this cut even more additional funds must be raised. Clarity about these initiatives should be provided as soon as possible, because enough “fear of the unknown” already exists regarding the so-called country package of restructuring measures to be monitored by the proposed Caribbean Body for Reform and Development COHO.
There is not much choice either when it comes to rising fuel rates, as allowing these to continue increasing could have a counterproductive effect. A growing number of Dutch-side motorists are filling up across the open border where it is significantly cheaper.
If this trend continues it could easily lead to even less tax earnings, so in any case doing nothing is no alternative.