Published On: Tue, Mar 24th, 2020

A nightmare scenario

Hilbert HaarBy Hilbert Haar

For anybody who thought St. Maarten would be able to weather the corona-virus crisis on its own, José Jardim, the interim president of the Central Bank presented some sobering numbers during a press conference in Willemstad. In a separate op-ed in the Antilliaans Dagblad former Central Bank President Dr. Emsley Tromp added some more stuff to worry about.

But let’s start with Jardim’s alarming numbers. To support the national budget St. Maarten’s government needs between 86 and 104 million guilders ($48 to 58.1 million); per month. And for as long as the corona-crisis continues. Next to that the monetary union needs 60 to 70 million guilders ($33.5 to $39.1 million). If the crisis last, say six months St. Maarten’s budget alone needs between $288 and $348.6 million from elsewhere to stay afloat. (Compare this with the 2020 budget; it projects total revenue for the whole year of around $258 million).

These numbers are as astounding as they are frightening because the first question that comes to mind is obviously: where should that money come from? Jardim and Tromp both think that the Kingdom has to step up to the plate but if you listen well you can already hear Dutch politicians squirming at the thought that they have to ship millions upon endless millions across the ocean.

Yes, the Netherlands will help – there is no other option. But will they come up with the same mountain of bureaucracy that has made the World Bank Trust Fund so ineffective? The same trust fund made $3.6 million available to St. Maarten to mitigate the impact of the corona-crisis.

That $3.6 million is a one-time offer and it just represents 7.5 percent of what the country needs per month according to Jardim. Tromp says it politely in his op-ed in the Antilliaans Dagblad where he notes that the financial support of the Kingdom government should be “adjusted for the bureaucratic tangles that led to the ineffectiveness of the trust fund.”

All this put not only the government but also the parliament of St. Maarten neatly in their respective places. Criticizing the role of the World Bank in the aftermath of Hurricane Irma parliamentarians have openly boasted, if I remember correctly, that they did not need money from the Netherlands; turns out that they did need it after all, so the political bla-bla was obviously meant for domestic consumption only.

A similar attitude towards the (expected) financial corona-support from the Kingdom won’t do anybody any good.

I therefore suggest a simple and harassment-free solution. Send the government payroll and all qualifying invoices to the Ministry of Home Affairs and Kingdom Affairs and let Minister Knops take care of all payments. No hassle and no corruption – at least not on our side of the ocean.

Tromp warned in his op-ed that the peg could come under pressure – indicating a potential devaluation of the Antillean guilders versus the US dollar.

On another note, the Antilliaans Dagblad warned in an analysis that the corona-crisis could lead to higher food prices and therefore to social problems.

To me, the most chilling statement comes from Tromp’s op-ed: “No society can safeguard public health for long at the cost of its overall economic health.

Think a little bit about this and ask yourself what is more important. It seems to me what Tromp implies here is, that when push comes to shove, a country’s economy is more important than the lives of its citizens – and that some people will have to die so that others can live.

That’s what I call a nightmare scenario – one that I do not wish on anybody.

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Table Financial Support Curacao & St. Maarten

Related links:
Report in Antilliaans Dagblad: “750 to 930 million in financial support needed”
Analysis in Antilliaans Dagblad: “Let realism prevail”