The legal mandate of the Cft is to monitor the fiscal situation in the countries of Curaçao and Sint Maarten based on the Rijkswet Financiele Toezicht (Rft.) On March 27, 2020, the Council of Ministers of the Kingdom of the Netherlands (RMR) invoked article 25 of the Rft allowing Curacao a period of noncompliance with article 15, sub 1 of the Rft.

Pursuant to this decision, the Cft was asked to advise the RMR on the liquidity needs of the countries for the month of April related to the COVID-19 outbreak. With this request, Cft was accorded a task potentially in conflict with its legal mandate to report the extent to which the countries are complying with the Rft.  In the CFT’s recommendation of April 7, 2020, to the RMR, it appears that these seemingly contradictory tasks have necessarily permeated the Cft’s advice.   On various points, the CFT’s recommendation seems guided by the committee’s legal function rather than the current urgent situation confronting the countries as a result of the COVID-19 crisis.

The very fact that the RMR invoked article 25 of the Rft implies that the countries are allowed to deviate from the provisions of article 15 sub 1. Yet Cft overlooks this fact in its advice to RMR and continues to insist on Curacao’s adherence to the provisions of article 15 sub 1 as contained in its previous recommendations.  The objective of Curacao’s request to the RMR was to obtain the necessary funds to finance among others the extra healthcare expenditures needed as a consequence of the coronavirus outbreak and to provide assistance to the private sector to avoid an economic catastrophe.

Cft starts its response to RMR by acknowledging that the loss of revenue of the government of Curaçao is realistic based on the projections of the Central Bank. It emphasizes that those projections may actually be on the lower side since they were premised on the partial lockdown in effect at the time, and a total lockdown was promulgated on March 30, 2020.  According to a recently issued Note, IMF estimates the 2020 financing fiscal gap for Curaçao at 22 percent of the GDP comprising both a shortfall in fiscal revenue and higher expenditure.

CFT Evaluation of the Curaçao request

In its evaluation of the strategy underpinning Curacao’s request for financing to the RMR, Cft states that the reallocation of the funds in the context of the groeistrategie is inconsistent with previous agreements.  In addition, the other measures announced by the government do not seem to get Cft’s approval. However, Cft’s evaluation is in contravention of the RMR’s decision to allow noncompliance of article 15 sub 1 for Curaçao.

Cft is further of the opinion that the measures proposed by the government should be more austere given Curacao’s fiscal situation. The Cft is of the opinion that the private sector is not making sufficient sacrifice. Here again the committee overlooks the overriding objective of the government’s assistance program underpinning the financing request. The very fact that the sector will get 80% of the relevant minimum/SVB wage benchmark, implies in itself a sacrifice of at least 20%. The Cft departs from an economic contraction of 14.9% as projected by the Central Bank. By arguing for a much more austere program, Cft is increasing the downside risk for the Curaçao economy.

As support for small and medium-sized enterprises, the government proposes a credit facility to maintain productive capacity. In its evaluation Cft states that the sector itself has to make a larger contribution to the credit facility. The credit facility is based on the projected needs of the sector. To the extent that a small and medium-sized enterprise does not make use of the facility and uses its own funds or seeks access to other sources in itself implies a sacrifice by the sector.  Arguing that the sector needs to make a larger contribution seems presumptuous.

Cft also is of the opinion that an additional supplement for the “onderstandtrekkers” is not sufficiently argued since it does not seem to have a direct link to the current crisis. What Cft again overlooks is that in practice the “onderstandtrekkers” allowance is a de facto supplement. Therefore, the economic standstill means that their primary income also would have dried up.

While Cft argues that Curaçao should not deviate from previous agreements when it relates to, among other things, the groeistrategie, the committee does not maintain the same line of reasoning when it comes to the begrotingskamer and national planbureau, for example.

The Cft concludes its evaluation by arguing that Curacao’s budgetary situation does not justify additional loans preferring instead a more austere package financed by creating the necessary fiscal room in the current budget. Here again, the Cft seems to argue against the RMR decision of March 27, 2020. Before the corona crisis, it was contended that social constraints prevented the creation of any additional fiscal room. By arguing now in a much more untenable situation for additional loans, Cft again seems to be insensitive to our current social economic realities.[1]

Liquidity Needs

In determining the liquidity needs of the government, Cft seems to condone the buildup of arrears when it refers to SVB since the committee does not have sufficient insights into the liquidity of SVB. The government should regularize its arrears. It should not depend on Cft’s insight into the liquidity position of any institution.

Cft is using this opportunity to advise the RMR to draw its attention to Cft’s previous advice rather than advise the RMR within the context of the current coronavirus crisis. This again reflects the conflicting situation for Cft as it had to advice the RMR on matter it previously as advised against.

The additional monitoring suggested by the government for this special program gets only lip service from the Cft. It is not clear to me why the Cft does not seem to support this additional audit function proposed by the government to monitor the rescue program.

Emsley D. Tromp

Former Central Bank president

[1] In a Note dated April 6, 2020, titled “Curaçao and Sint Maarten: Impact of COVID-19,” the IMF stated that “Assuming that financing is provided as loans, the debt-to-GDP ratio in Curaçao would rise to close to 90 percent of GDP, and in Sint Maarten to 91 percent of GDP in 2020.” These disproportionately high debt-to-GDP ratios were the overriding criteria used by Holland to provide the island with debt relief in 2009. Allowing them to again reach those ratios is tantamount to denying them the possibility to realize one of the most important objective of the 10-10-10 constitutional restructuring.

Dear editor,

 Many in the business community just think of themselves, look at when they come out in the media and what they talk about—this is the sentiment you hear in the street and on social media.

  To what degree the above is true is no doubt debatable. What is certain, however, is the contentious relationship that the business community organizations have with both the government and employees. Again, to varying degrees. Recent deliberate nasty comments regarding work permits don’t help either in their quest for an audience, sympathy, or assistance.

  No doubt, every country, St. Maarten included, is going through unprecedented rough economic and social times due to the COVID-19 pandemic, which will only get worse in the short run. It’s going to get very bad for many, the most affected will be the working class and unemployed and the most vulnerable people in our society. Government is doing their best considering their handicaps. Hindsight is always 20/20.

  So instead of realizing the gravity of the totality of the situation, these business organizations insist, head strong, on focusing their efforts, no matter how biased, on extraordinary requests in times of crisis. The possibility for such assistance is indeed problematic in numerous ways.

  So where does that leave us—stuck between a rock and a hard place until someone or something gives. If only our interest is focused on one sector of society, the other sectors will have to give. That is a different type of St Maarten we all would not want to live in.

  The other option of course is that we could simply work together and negotiate our differences. To achieve some sort of cooperation in spite of our different interests among the unions, government, and business organizations, amongst others, has to start and end with respect, fairness, and compassion from all sides in negotiating.

Pedro de Weever

Seven-year-old Kodiba Uzoma wrote a letter to Dr Gerstenbluth as part of his school assignments. He asked Curaçao Chronicle to deliver this letter to the doctor, which we did. 

The letter shows this little boy's appreciation of the work Dr. Gerstenbluth is doing for the island.

Dr. Gerstenbluth’s reaction was “WOW, thank you very very much!”.

The letter says:

Dear Dr. Gerstenluth,

My name is Kodiba. I am 7 years old and a grade 2 student of the Curaçao American Preparatory School.

I want to thank you for all of what you are doing to protect us from the Covid-19 and for the information to help us stay away from the virus.

Whenever I see you on TV you look tired.

I hope you get enough rest from work.

I like that you can speak Dutch, English and Papiamento very well so everyone on the island can understand you.

My dad told me that you are an Epidemiologist, which is why you have been able to help us in this Covid-19 situation.

I hope to study well in school, so that some day I can be able to help my community in a time of trouble, like you are doing.

Keep up the good work! We are praying for you.

From Kodiba Uzoma

Thank you Kodiba, we know you will study hard and become very successful in life.

Curaçao Chronicle

Solidarity is defined as; unity or agreement of feeling or action, especially among individuals with a common interest; mutual support within a group. In a recent article by Kathryn Jean Lopez for the National Review, she said ‘to stand in solidarity with the vulnerable is to become vulnerable’.
The people of St. Maarten, like people all over the world right now are vulnerable. Vulnerable to disease and death and vulnerable to the certain economic recession this pandemic will bring in the months and years to come. The number of deaths have shown the absolute poor state of our health care system. With 37 positive cases of COVID-19 confirmed we are at 6 deaths, a 16.22 death rate for confirmed cases. By contrast Germany with more than 100,000 laboratory-confirmed cases has 1584 deaths with a death rate of 1.6 percent. In South Korea, another model in the handling of this virus the fatality rate stands at 1.8 percent. Italy has a death rate of about 12 percent and Spain, France and Britain stand at 10 percent. Now we can argue that we cannot compare tiny St. Maarten to large, developed, wealthy nations so let us compare closer to home. At present Dominica, tiny, under-developed nation ravaged by Erica and Maria in recent years, at present has 14 cases with 0 deaths. Antigua has 15 cases with 0 deaths. Barbados has 56 cases with 1 death for a 1.79 death rate, Martinique has 149 cases with 4 deaths – a 2.68 death rate. While there are certainly many factors contributing to these numbers and yes these numbers will surely change, it is a glaring comparison. A comparison that questions the state of our health care system, and the timeliness and adequacy of our response to this pandemic.
Germany is being looked at as an anomaly, experts all over the world are enquiring about their methods. What they have found is a strong public health care system that was well prepared - so much so that they are now accepting patients from Spain and Italy. Germany has also performed more testing than any other country in the world. The most important factor though is the effective leadership displayed leading up to and during the crisis; clear, calm communication along with strict rules on social distancing. Additionally an early stimulus package certainly helped to alleviate fear and anxiety. Because of this the population has trust in their government and the Germany chancellor’s approval ratings have soared
This bring us to another comparison; in one of her recent press briefings the Prime Minister of St. Maarten stated that the EOC (Emergency Operations Center) had their first meeting in the first week of March. On Monday March 16th, there was an update on the official government website of a meeting held with the Dutch and French counterparts. After this meeting an emergency meeting took place with the full EOC – a quote from the release states ‘In this meeting, the EOC deliberated and drew the conclusion that stakeholder consultations needed to take place before more far-reaching decisions could be made. ESF coordinators will provide advice on school closures and other relevant restrictions to Prime Minister Jacobs tomorrow.’
This was on March 16th, a time when countries all over the world were already engaged in critical preparedness and response to the COVID-19 virus. We saw the roll-out of restrictions put in place by the Prime Minister where it took almost three weeks to determine which businesses were essential or non-essential; almost three weeks to determine should we close the barbershops or should we re-open them or should we close them again. And while our French counterparts shut down schools and imposed restrictions on movement, we continued to allowed free cross border movement and waited for the first case in order to act.
On April 2nd via a release in The Daily Herald the Prime Minister stated ‘that the country is continuously
assessing new ways to source capacities and resources that it has locally and has been trying to
partner with various stakeholders and businesses to see how to identify a location for quarantining
and, where necessary, for isolation units. “An isolation space has been identified to house COVID-19-
positive patients which we expect to start populating as of tomorrow in order to ensure isolation of
these cases,”’ On April 2nd the government has just identified a location place for quarantining. Let that
sink in.
Also on April 2nd the Prime Minister announced some ‘good news’ – ‘testing for COVID-19 will be
ramped up as the country now has the ability to test locally’. Yet on Sunday April 5th per SMN-News,
epidemiologist Eva de Weever said that ‘test kits are limited and that persons who develop symptoms
while in confinement will be tested. She said at the moment there are not sufficient kits to test
everyone.’ Again let that sink in.
In her press conference on Sunday April 5th, the Prime Minister appeared to be rushed, even annoyed at
times. This was confirmed when she later stated that the press conference should have been over more
than an hour ago because she had to be at the airport to receive the plane delivering medical
equipment and additional beds to the island. With a deputy prime minister, a health minister and other
members of the EOC the Prime Minster felt it necessary to rush an address to the nation in order to
receive medical equipment and stage a photo-op at the airport. And as the days go by the rest of
government becomes more quiet – the 15 new parliamentarians and the 7 new cabinet members who
were literally just all over the place pre-election are all but absent now. From the outside looking in
there seems to be no cohesion in the coalition or in government as a whole. No solidarity, no all hands
on deck approach and certainly no recommendations on how to handle this pandemic.
But I guess fear not because today April 6th our leaders have made a bold move, one that is sure to make
all our lives better. I’m not sure if it’s a lot better, a little better or just somewhat better; but better it
will be, because our leaders past and present have generously decided that in solidarity with the people,
they are giving up 10% of their salaries.
Remember as stated above, ‘to stand in solidarity with the vulnerable is to become vulnerable’. For our
dear leaders becoming vulnerable means living not on approximately Nafls 20,000 per month plus
additional allowances and car and telephone expenses; but on a paltry, measly, worthless Nafls 18,000
(20,000 – 10%) per month.

All over the world this pandemic is showing the inequalities present in communities; social and
economic inequalities. It is also exposing governments and leaders and quickly separating the wheat
from the chaff. However, with many people focused on their health, their next meal or whether they will
be able to keep a roof over their heads we may be missing the big picture exposed by this pandemic.
While this is a most difficult moment for almost everyone, we can be sure that this is tame compared to
difficulties we will continue to face in the future, whether through pandemics or natural disasters.
Of course at a time like this many people will call for unity as they should; history has shown that
countries that come together in times of hardship are able to overcome much quicker. And some people
will even call for us to refrain from criticizing and making demands. But we cannot miss this opportunity
to look closely at our shortcomings and to make concrete changes that will enable us to be better
prepared for a future pandemic.
A too large governing body that has shown itself to be ineffective, incompetent and unempathetic is our
biggest shortcoming. In the past 5 years there have been three elections and we have had at least 8
governments in 10 years. These governments have been made up of mostly the same people, who
continually promise to put country above self and work for the people. In 10 years they have not kept
these promises. Even now when the country should have been preparing for this pandemic we were
busy forming a new government. Some of these same individuals who are in government were
responsible for bringing us into our new status in 2010. The agreed upon and enacted legislation to
ensure that they were well paid with first class benefits. Persons holding positions of authority on this
island earn approximately Nafls 20,000 per month. This does not included the additional 6%
renumeration for representation, and also the use of a car and telephone. They and their families enjoy
first class health insurance and in case of dismissal or removal from office they may continue to receive
payment for up to two years. Keep in mind that there is no national unemployment scheme for citizens
of this island, but the highest paid people on the island made sure to secure unemployment funds for
themselves. The Netherlands has repeatedly asked our officials to lower government spending and
improve financial management in order to balance the budget; even recently asking officials to reduce
their salaries, which they refused. Instead they threw down the government twice, held elections twice
and in so doing increased the government payroll again. Can we confirm that the 10% that will be
discounted will not be recouped somewhere else in the budget?
At the same time other citizens must make do with a minimum wage of approximately Nafls 1530 which
does not cover the monthly rent on a safe, clean 1 bedroom apartment on this island. Add to that the
rising costs of food and utilities and we have a large percentage of the population who cannot afford to
go without a paycheck. This large section of the population therefore cannot afford to save for a rainy
day – or a global pandemic, let alone a global economic depression. They are now anxious, even fearful.
While children are now being taught online, and many parents have not received a paycheck or have
received a discounted paycheck, the internet providers are sending out invoices as per usual. What
happens when a parent cannot pay that internet bill, does her/his child stop learning? Who steps in to
ensure that this does not happen? Rent is due or past due for many persons, some people are choosing
not to pay their rent to try and safeguard whatever funds they have. Some persons are asking their
landlords to discount their rent or to delay receiving payment. What happens when the landlord says no
and demands payment as per usual? Who will step in to ensure that person is not evicted or harassed at
a time like this? Where is the government; and our elected members of parliament? Why have they
gone radio-silent while the Prime Minister continues to struggle and make mistakes? Where is the
solidarity through accountability?
There is so much work to be done; fighting this pandemic and flattening the curve are only the first
steps. COVID-19 has left us exposed – our health system is poor and inadequate, our economy as it is no
longer works and our treasury is empty. Our economy and our livelihood are now completely in the
hands of The Netherlands. We need a government who gets it, who understands the role of leadership
in times of trouble and who knows that the time for old politics is past. Our world has changed and we
are about to enter into another above average hurricane season. We need persons who are willing to
put aside their greed and arrogance and come together, lean on the experts to get the work done. And
above all we need a government who knows that 10% just won’t cut it.

Name withheld at author’s request