St. Maarten Government gives up on 143 million in debt relief

POSTED: 02/28/12 1:42 PM

St. Maarten – The government is no longer chasing the 183 million guilders in debt relief it has claimed for a long time from the Netherlands. In the draft budget 2012 the number is still mentioned, but only as a point of reference. In answers to questions submitted in Parliament Finance Minister Hiro Shigemoto announces the government is still negotiating with the Dutch Minister of Home Affairs and Kingdom Relations on 40 million guilders, it had first requested from former minister Piet Hein Donner.

“The matter is being discussed with Minister Spies to see if her approach with regards to the 40 million guilders will be an different from the former minister Donner, who basically said that the invoices had to be submitted before 10-10-10, something which this cabinet that office on 12-10-10 cannot be held responsible for,” Shigemoto states.

Later he’d add, “Nevertheless it is important that St. Maarten receives the debt relief, which was signed for on November 2, 2006. This government will continue fighting until the very end to receive the monies, which were put aside for the payment of St. Maarten’s payment arrears up to and including December 31, 2005. Discussions on this will continue on my next visit to the Netherlands.”

So far, according to the budget, 65 million guilders ($36.1 million) in debt relief has been released to satisfy a debt to the pension fund Apna.

“Initial estimates of the payment arrears were approximately 183 million guilders ($101.6 million). The actual payment arrears are around 110 million guilders ($61.1 million).

Payment arrears only qualify for debt relief after they have been verified by accountants based on established protocols. Payment arrears to Apna have been restructured to an amount of 65 million guilders, and claims have been submitted for 40 million guilders ($22.2 million),” Finance Minister Hiro Shigemoto wrote in the explanatory notes in the chapter about the national debt.”

But St. Maarten also has to deal with a 200 million guilders ($111.1 million) debt to the Netherlands. This is the result of agreements about the division of debts that remained after executing the debt relief program. The Netherlands took over these debts and then assigned them to the new entities (the BES-islands, Curacao and St. Maarten).

This method was chosen to avoid a cumbersome process of dividing these debts over the new entities. This gave the Netherlands a claim on St. Maarten and the other entities based on the cash value of the debt.

The interest percentage for this debt has been set at 2.5 to 3 percent. St. Maarten has the option to refinance this debt on the local market if it manages to negotiate better conditions.

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