Heyliger considers development bank modelPOSTED: 06/14/11 12:17 PM
St. Maarten – Deputy Prime Minister Theodore Heyliger wants to use money from the Pension Fund, the Social and Sickness Insurance (SZV), and the Central Bank to fund a development bank for St. Maarten. This is one of the reasons he and Finance Minister Hiro Shigemoto will be urging the Prime Minister of Curacao Gerrit Schotte to work with St. Maarten on splitting up the Central Bank of Curacao and St. Maarten as soon as possible.
Heyliger revealed the idea for the development bank on Sunday’s For the Record with Eddie Williams on Radio Soualiga 99.9 Choice F.M. It is his view that using funds from the three entities, which are all required to invest will help the economy and also ensure the long term viability of the institutions.
In the case of the pension fund Heyliger’s idea could save the government money as the pension fund has investments that have interest rates of 0.5 percent to 2.5 percent. The required interest rate to keep the pension fund viable is 4.5 percent. Should the return be less than that, the government stands as guarantor. Heyliger finds that undesirable, especially since the island has had no major investments from the pension fund.
“We have to look at these funds and how we can invest them and we should not be so scared or skeptical. We need housing, garbage facilities, sewerage lines and these will all pay back the pension fund, which is required to invest 40 percent of its income in long term projects. Our airport pays over 90 million in bonds. Our pension fund can also buy the bonds. We really have to be less skeptical and looking with some passion about investing in our country,” Heyliger said.
All together the pension fund, the SZV and St. Maarten’s share in the Central Bank of Curacao and St. Maarten potentially tops out at 1.08 billion guilders. That money and a potential 30 million guilders from other sources is enough in Heyliger’s opinion to begin putting the country on a good footing in terms of its infrastructure. Two specific areas that could benefit are Education and Justice.
“The population is very alarmed with the crime situation and if we don’t grab this situation and invest more into combating crime then we will lose the economy and our loved ones and that is a very scary situation. So we need to get creative about cutting costs and increasing the revenue because bringing more taxes is not ideal,” Heyliger said.
Another reason Heyliger wants especially the Central Bank of Curacao and St. Maarten split up is because he feels St. Maarten will never be treated fairly and because the majority in Curacao’s Parliament has said they no longer wish to share. As evidence of the unfair treatment Heyliger said that while St. Maarten’s participation in the Central Bank totals between 400 million and 600 million the country will never be able to claim a key function like Chairman of the Board or Director of the Central Bank.
“Curacao will not allow us the Chairmanship. We will put up a hell of a fight, but they won’t concede. We have to replace Dr. Tromp but you will never see a St. Maartener. It will never happen. We have never gotten a major bond. Curacao will continue to dominate and use our reserves to their benefit. Why should we be sitting in an institution that will never really look at our interest and in an unwanted partnership? Let us take our division and create our own development bank that will sit with our government institutions and give 5 percent interest. We can use our money and develop St. Maarten and make sure we don’t have to ask anybody else,” Heyliger said.
“If we’re going to try and fight with them, that won’t work. It is time to see how we can get out of this thing,” the deputy prime minister added.
Heyliger will also use Tuesday’s meeting to press for a speed up in the process of dividing the assets of the former Netherlands Antilles.