Published On: Sat, Jun 29th, 2019

A constitutional revolution

Hilbert HaarBy Hilbert Haar

It is hard to tell what drives rookie MP Luc Mercelina. His announcement of what he called a “constitutional revolution” must have raised some eyebrows – at least among those who were paying attention – because the ten points he put forward have nothing to do with the constitution.

But what is clear from this ill-advised presentation is that Mercelina resents the influence of the Dutch government on St. Maarten’s affairs. Truth be told, there are times that I think the Dutch could do a better job in the interest of St. Maarten too.

But what does Mercelina really want? The first point he mentioned was dollarization. That discussion goes back more than ten years and as far as I know – and based on results – there is no appetite whatsoever to go in that direction. It has ups, it has downs and consecutive governments have never had the balls to take a decision about it – though not taking a decision is also taking a decision.

Then – as a logical consequence of dollarization, Mercelina wants to establish St. Maarten’s own Central Bank. Again, years ago the Social Economic Council advised the government to get out of the monetary union with Curacao as soon as possible. Again, no government has ever heeded this advice.

And then, Mercelina stated, he wants “to cancel the Cft.” This may sound like a popular idea, after opposition MP Rolando Brison declared the Cft to be “one of the biggest problems we have as a country” but the role of the financial supervision is regulated in a consensus kingdom law: the kingdom law financial supervision. St. Maarten agreed to financial supervision to obtain country status and now it is stuck with it. There is no way the government, or the parliament for that matter, can “cancel the Cft.” Financial supervision won’t end until St. Maarten presents a balanced budget for three consecutive years.

Then there is the matter of making English the country’s first language. That is an understandable desire, given the prominent use of this language on the island, but it is not as simple as it looks. If the government were to take this step it would enter into a huge and above all very costly project. That is because all legislation is written in Dutch – and that will have to be translated.

There is an English version of the constitution – and that translation contains mistakes. The fallback option: in case of mistakes the Dutch version prevails. A decision in favor of English is fine, as long as our decision makers realize that there are consequences.

The same goes for Mercelina’s wish to stop taking loans from the Dutch government and to explore international financial markets.

Well, that is another very costly idea. When financial supervisor Cft approves investment-loans for St. Maarten (based on a balanced budget) the Netherlands is by law obliged to subscribe to those loans. Bingo for St. Maarten because due to the favorable credit-rating the Netherlands enjoys, the interest on these loans is extremely low.

It is fair to say that St. Maarten’s credit rating cannot stand in the shadow of the Dutch rating, so a venture into international financial markets is going to cost the country dearly. Just figure out the difference between a $50 million loan against 1.5 percent and one against 6 percent or higher and you will understand that this will put a hell of a lot of pressure on the budget. The people Mercelina says to represent will suffer the consequences.

I would like to see a follow up to Mercelina’s “constitutional revolution:” a financial paragraph that explains exactly how much this fancy initiative is going to cost the tax payers.

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