Cft threatens Curacao with new instruction

POSTED: 01/2/13 12:29 PM

GREAT BAY – While St. Maarten is still awaiting the advice from the board for financial supervision Cft on its draft 2013 budget, Curacao received an uninvited advice from the financial supervisor. The Cft thinks that the measures the country has in mind to balance the budget are not feasible, in the sense that it will most likely not be possible to implement them in such a timely manner that they will have the desired impact on the 2013 budget.

The Cft sent its advice before Christmas to the in the meantime departed interim Prime Minister Stanley Betrian, finance Minister Jose Jardim and parliament president Mike Franco.

The supervisor notes that the measures Curacao has in mind are indeed necessary. “The Cft doubts whether it will be possible to implement all measures in a timely manner, because many of them still have to go through the process of advice, legislation and implementation.”

The Cft wrote that the measures must be implemented in the first quarter if they want to have the desired financial impact on the 2013 budget. “
The Cft will therefore monitor the timely execution based on article 17 of the Kingdom law (financial supervision – ed.). This article says that the Cft has the option to advise the Kingdom Council of Ministers to issue an instruction if the government implements measures so late that this endangers a balanced budget.

But the supervisor also compliments the government for the way it established the draft budget. “This budget clearly has a higher information value, it is more readable and it contains better founded analyses. The efforts Curacao has made to improve its financial management are clearly bearing fruit.”

The many severe measures will lead to substantial higher premiums, the Cft notes. This in turn will result in a higher burden of social charges. “Combined with the economic perspective for 2013 and 2014 (2.2 and 0.6 percent negative growth) this means that everybody is asked for a significant but necessary contribution to balance the government finances,” the Cft concluded.

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