Economic recovery is above expectations, CFT says

PHILIPSBURG — St. Maarten performed better than expected in the first half year of 2023, financial supervisor CFT writes in a reaction to the country’s second execution report it received on August 30. This is to say that St. Maarten outdid the projections in its 2023 budget.

According to the Cft, St. Maarten ended the first half year with a surplus of 41 million guilders ($22.9 million). “This is the result of higher revenue and lower expenditures,” the Cft wrote. The surplus is 34 million ($19 million) higher than budgeted; revenue is 24 million ($13.4 million) above budget. Expenditures are 10 million ($5.6 million) lower than budgeted, mainly because of lower costs for personnel and goods and services.

By the end of the year, St Maarten expects to record a surplus of 1 million guilders ($558,659). This is 20 million (($11.2 million) lower than what the Cft expected based on historical data and the realization in the first half year.

Minister of Finance Ardwell Irion explained to the Cft that he expects lower revenue during the low season and higher expenditures on goods and services and on retroactive salary payments to members of the police force.

The government revenue in the second quarter was 282 million guilders ($157.5 million), 24 million ($13.4 million) more than budgeted. It is also 53 million ($29.6 million) more than the revenue during the same period in 2022.

“The increase is due to a stronger recovery of the economy and the execution of projects in the country package,” the Cft wrote.

Personnel costs in the second quarter were 107 million guilders ($59.8 million). This amount includes 8 million ($4.5 million) for vacation allowances and 2 million ($1.1 million) for retroactive payments to the police force. It is remarkable, the Cft notes, that the gross salaries in the second quarter of 2023 are 2 million guilders lower than during the same period in 2016.

The government has budgeted 90 million guilders ($50.2 million) for investments this year. It wants to obtain a 61 million guilders ($34 million) loan for this purpose but so far it has not receive the money, even though the Cft approved the loan on May 10.

The improvement of the country’s financial management is still a work in progress. “St. Maarten works on guaranteeing the cleanup of its financial administration and the tender for a new system,” the Cft wrote.

At the end of June 2023 St. Maarten had 40 million guilders (22.3 million) in liquidity, a decline of 8 million ($4.5 million) compared to the end of the first quarter. The government expects to have 5 million guilders ($2.8 million) in liquidity by the end of the year.

The country’s national debt per June 30, 2023 is 1,287 million guilders ($719 million), or 44 percent of its gross national product.

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