Published On: Wed, Jun 22nd, 2016

Cft Chairman Age Bakker: “Round off current financial matters with caution”

CFTWILLEMSTAD – During a three-day visit to Curaçao the Board of financial supervision for Curaçao and Sint Maarten (Cft) concluded that the progress in the public finance has consolidated. The year 2015 finished with a surplus: this happened for the third year in a row. A number of important financial legislative processes were initiated in the recent months and now it is essential to round these off shortly, as well as the financial statements 2012 and 2013.

During its three-day visit to Curaçao on June 20, 21 and 22, Cft met with the Governor, the Council of Ministers, the Minister of Finance, the Financial Parliamentary Committee and the General Audit Chamber. The Board also paid a working visit to the Multi-Disciplinary Project Team on the future of the refinery. It further visited Cpost and the St. Elisabeth Hospital. During those discussions Cft concluded that significant steps have been made in the area of the public finances. The 2011 financial statements have been adopted and the 2012 and 2013 financial statements have been discussed in the Financial Parliamentary Committee. In addition, a start was made with the legislation process of a number of key financial and tax ordinances.

Fiscal year 2015 ended positively, 2016 still on track

The year 2015 ended with a slightly positive balance. For the third consecutive year the Curaçao budget balanced out after a transfer to the swinging fund (schommelfonds). It appears however that public investment in 2015 failed to meet the budget. The Minister of Finance shall endeavor to assess the capital service more realistically in the future. This week the second budget amendment of 2015 is discussed in Parliament, making it possible for the 2015 financial statements to be prepared prior to September. In order to fully conclude the financial matters, it is important that Parliament addresses the other financial legislation soon, such as the Ordinance on the optimization of government-related entities and the financial statements of 2012 and 2013.

Economic strengthening is still needed

The economic development is improving in 2016 with a projected real economic growth of 0.5%. The 2015 Business Survey of the Central Bureau of Statistics show that the highest number of companies since four years invested in Curaçao in the second half of 2015. Furthermore, Curaçao presented the National Development Plan end of March, in which sustainable economic growth is emphasized. The Curaçao economy continues to face significant challenges. Cft identifies with the preliminary conclusions resulting from the consultation of the International Monetary Fund (IMF), recommending further diversification andincreased flexibility of the labor market. Also, the IMF endorses the recommendation to establish a long-term target for the national debt of 40% of GDP, with room for short-term deviation from the norm.

Cpost International

Cft visited Cpost International, which in recent years has been experiencing structural operational losses. In 2015 Cpost suffered an operational loss of ANG 5.2 million. The negative equity will therefore increase rapidly. During the visit, Cft discussed the progress of a number of measures which have already been put in motion by Cpost. For example a project on community boxes is ongoing; the concession amount for Cpost has been reduced, while the company intends in the future to focus more on the distribution of parcel post.

"Careful finalizing required"

Now that the parliamentary year is coming to an end, Cft advises the government to rapidly finalize the main financial activities. Cft Chairman Age Bakker: "For all parties it is important that the finances of Curaçao are in order. To complete this government term it is also important to timely submit the draft 2017 budget to Parliament. Additionally we recommend finalizing the current discussions of the key financial and tax laws as well as the annual accounts 2012 and 2013 before the elections."

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