Published On: Fri, Oct 16th, 2020

UP-leader Brison spins the 75 million bond issue story

PHILIPSBURG – United People’s party leader MP Rolando Brison said in an interview with Curacao’s TV Direct program Notisia 13 that Finance Minister Ardwell Irion is “one hundred percent correct” in his disagreement with financial supervisor Cft over the intention to float a bond for 75 million guilders. But Brison’s arguments remain at odds with opinions the Cft has expressed in previous advices.

“The Cft is choosing to interpret the kingdom law in a way they find convenient for their modus operandi,” Brison told Notisia 13-interviewer Nicole Trinidad. “This is sad because the Cft ought to be a body that is working in our best interest.”

Brison said that in its advice against the bond issue the Cft has ignored paragraph 6 and 7 of the kingdom law financial supervision. “Those articles state that, if you talk about a bond, the Central Bank must render advice and not the Cft. I find it very disturbing that they once again show their true colors as an organization that does not work in the best interest of St. Maarten. They have no regards for the urgent financial needs of our country.”

Brison went on to claim that St. Maarten has already permission to deviate from a balanced budget. “We are still in a deficit and this loan will keep us within that deficit. That does not change the permission the RMR (Kingdom Council of Ministers) has already given us for this matter.”

Trinidad pointed out that there is a difference between the budget and the intended loan, but Brison remained unperturbed: ‘We have a budget amendment that is on its way to parliament. The Cft is jumping the gun. Games are being played here.”

But the statements made by Brison and by Minister Irion do not hold up against an earlier advice from the Cft. On September 28 the financial supervisor advised negatively on a request to borrow 100.2 million guilders for capital investments and for the repayment of a 50 million guilders loan from 2010 that matured this month.

The Kingdom Council of Ministers allowed St. Maarten on July 10 to deviate from article 15 of the kingdom law financial supervision. “The RMR still has to take a decision about up to which point St. Maarten can deviate from these standards,” the Cft wrote, adding that because the 2020 budget does not meet the Rft-requirements a decision about the loan request still has to be taken.”

The Cft furthermore pointed out that “only capital expenditures for absolutely necessary replacement-investments and the reform-agenda should qualify for a loan.”

Minister Irion said during Wednesday’s Council of Ministers press briefing that article 16 of the Rft refers only to loans for capital investments and that it does not apply to the bond issue that is for covering the governments operational expenditures. Since the Cft will only give a positive advice for loans for capital expenditures that are absolutely necessary it stands to reason to assume that loans for operational expenditures are out of the question.

Related news: Minister Irion contests Cft’s take on article 16

There is also the kingdom instruction of September 8, 2015, to consider. That instruction from the RMR determined that St. Maarten will only be allowed to borrow after meeting three requirements: the deficits of the period 2010-2014 have to be compensated, healthcare and pension expenditures have to be included in the multi-annual budget and payment arrears from the period 2015-2018 must have been settled.

Against this background it is rather odd that the Cft gave a positive advice on a loan request by former Finance Minister Perry Geerlings for 40 million guilders on August 19, 2019. In spite of this positive advice, the Netherlands did not subscribe to the loan as it is required to do by law.

See related statements of Prime Minister Silveria Jacobs in regards to this issue in the following article: Minister Irion contests Cft’s take on article 16


Related links:
Opinion piece: “An ugly dog fight”
Cft objects to intended 75 million bond issue
CFT letter to MinFIN about bond issue
CFT advice on capital loan investments
Prospectus Bond Loan Government of Sint Maarten
Brison’s Interview with TV Direct’s Notisia 13