Published On: Wed, Nov 6th, 2019

Financial position airport is “extremely fragile”

PHILIPSBURG – After a parliament meeting that lasted close to three hours and fifty minutes, Christian Party MP Claude Peterson’s motion that aimed to assure bondholders about the caretaker government’s authority to sign off on loans from the World Bank and the European Investment Bank for the reconstruction of the airport failed to get majority support due to a lack of quorum. When it was time to vote, there were only seven parliamentarians left in the meeting.

MPs Franklin Meyers, Jules James, William Marlin and Chanel Brownbill were not there, while MPs Brison and Emmanuel had already left before the motion came up for debate. When MP Frans Richardson and MP Jurendy Doran left, there were just seven members left and Chairman Luc Mercelina had no other option than to adjourn the meeting.

Finance Minister Perry Geerlings said at the beginning of the meeting that the bondholders were concerned about the caretaker government’s authority to sign off on the loan agreements. “They have asked for an unequivocal statement from parliament to provide clarity,” he said. “After such a statement, the agreements can be signed within a matter of days.”

But MPs like Frans Richardson, Christophe Emmanuel and Jurendy Doran were all of the opinion that the caretaker government already had the authority to sign off on the loans, because they are part of the parliament-approved 2019 budget.

“The bondholders don’t trust this government,” Emmanuel said, whereas it is more likely that those bondholders have their doubts about the incoming interim government why they refuse to sign until a new government is appointed after the snap elections.

A statement from National Alliance faction leader Silveria Jacobs – also tasked with the formation of the interim government – should put the concerns bondholders have to rest: “There is no way we can stop the process.”

Jacobs also emphasized that, as formateur, she had agreed with the governor’s instructions; they include respecting the loan agreements with the World Bank Trust Fund and the European Investment Bank for the reconstruction of the airport.

And while MP Richardson did not want to have anything to do with Peterson’s motion, he declared that he respects the budget: “The decision about these loans is part of the 2019 budget, so parliament has already approved this.”

Minister Geerlings agreed with that point. “We got permission through the budget. But the role of the bondholders is key and they don’t feel comfortable due to the motion of no confidence against this government. We were ready to sign on October 7, but the bondholders refused.”

Interim Prime Minister Wycliffe Smith made an attempt to convince parliamentarians of the need for a supportive declaration. “The bondholders may not understand our system and they need clarity. If they don’t get it they will refuse to sign, so I am asking parliament to provide that clarity.”

Minister Geerlings described the airport’s current financial position as “extremely fragile.” He said that the airport has $12 million in the bank and $10 million in accounts payable. “The airport needs a cash injection. The bridge loan of $20 million has been almost completely exhausted. The company is only able to cover the operational costs for November, but by December 1 they will run out of money.”

The minister told parliament that the airport terminal’s roof has been designed to withstand 185 miles per hour winds and that completion of the airport reconstruction is projected for the fourth quarter of 2021. Currently the airport operates at 71 percent of its 2016 performance levels – well above the expected 60 percent. Decline in revenue after the hurricane is around 15 percent.

MP Luc Mercelina as Chair of Parliament - 20191104


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