Published On: Tue, Mar 29th, 2016

Editorial Daily Herald: “Curaçao is better off with financial supervision”

CFT_CuracaoCuraçao’s appeal against the prolonging of Kingdom Financial Supervision (see Saturday paper) will be heard by the Council of State today, Tuesday. The case is of interest to St. Maarten for several reasons.

To begin with, the same law was applied for both autonomous countries created when the Netherlands Antilles was dismantled per 10-01-10. An advice and subsequent decision based on such by the Kingdom Council of Ministers regarding Curaçao therefore could have implications for St. Maarten, even though it did not –yet – object to extending the so-called Consensus Kingdom Law.

Moreover, the two are still in a monetary union with a joint Central Bank and shared currency. This means that particularly structural balance-of-payment issues affecting each could have negative consequences for the other.

The budgetary control exercised by the Committee for Financial Supervision CFT had been agreed on as part of the relief provided by the Netherlands for the huge 5-billion-guilder debt created in the former Antilles. That move accompanied the constitutional reforms within the Dutch Kingdom, to give the new entities coming out of that change process a “healthy starting position,” but at the same time prevent them from quickly going back into the red again.

The PS/PAIS/PAR/PNP/Sulvaran coalition in Willemstad apparently believes there is no longer need for supervision of public finances involving The Hague. Even the CFT has recognised the good work of the Ben Whiteman Cabinet in that regard, but also identified remaining risk factors that involve especially the Government-owned companies.

Moreover, elections are scheduled in Curaçao for the end of September and although the Council of State does not tread into local politics, that realisation may well play a role in the evaluation certainly for the Kingdom Government dominated by Dutch Cabinet members, which still has the final say in the matter. St. Maarten too is facing elections that same week and for some on both islands keeping the CFT in place no doubt will be a comfortable thought going into what is expected to be a rather heated campaign.

After all, while the William Marlin Cabinet and in particular Finance Minister Richard Gibson deserve credit for the “shotgun 2016 budget” that is likely to meet with the CFT’s approval, it is the latter’s pressure and insistence on proper budgeting as well as responsible management over the last few years that led to the current situation where financial order finally can be restored.

With all due respect for Curaçao, in the minds of many St. Maarten is better off maintaining the CFT for now and actually that probably goes for both members of the monetary union.

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