Features (2)

Soualiga Newsday Features (3430)

Work on medium-term fiscal adjustment. Balanced budget should not be at expense of recovery

SINT MAARTEN/CURACAO - When Curaçao and Sint Maarten agreed on implementing a reform package, the so-called Landspakket, with the Netherlands as a condition for liquidity support amid the COVID-19 pandemic, part of it included achieving a balanced budget by 2023.

Given the poor state of the public finances in the countries, fiscal consolidation is indispensable, the Centrale Bank van Curaçao en Sint Maarten (CBCS) acknowledged in its June 2022 Economic Bulletin.

“However, amid the heightened uncertainties, the question arises whether the current fiscal consolidation path is realistic. With increased inflation pressures moderating the pace of economic recovery and higher government spending required to provide targeted support to the most vulnerable in society, a balanced budget should not come at the expense of a continued recovery,” cautioned CBCS president Richard Doornbosch.

Four-year focus

“Instead, the countries should work on a medium-term fiscal consolidation path that balances the effects of fiscal retrenchment on growth,” the CBCS president advised.

“First, health care and pension systems reforms are needed to reduce the pressures on the national budget. Second, public financial management should be strengthened to achieve a more efficient and effective allocation of government resources,” Doornbosch continued.

“On the revenue side, tax compliance should be further improved to widen the tax base and to distribute the tax burden more fairly across the economy. Given the capacity constraints of the two countries, however, all these reforms cannot be implemented within one year.”

In its latest Economic Bulletin, the CBCS recommends that both countries develop a medium-term fiscal adjustment program that includes all measures mentioned above but with a 4-year focus.

“This program should be based on prudent assumptions regarding economic growth and fiscal targets and include clear medium-term priorities. In addition, the pace of fiscal adjustment should in the recovery phase be linked to a debt anchor instead of a balanced budget rule,” Doornbosch explained.

“The experience so far with the balanced budget rule in Curaçao and Sint Maarten demonstrates that it has not served soundness in public financial management and decision making while it mostly results in procyclical fiscal policy,” he further pointed out.

Sustained growth path

“The countries should implement measures that accelerate the pace of economic recovery and support a higher and sustained growth path. Structural reforms as agreed in the Landspakketten are necessary in both Curaçao and Sint Maarten to address the weaknesses on the supply side of the economy,” Doornbosch continued.

“An important area of reform is reducing administrative procedures and red tape.” Therefore, the June 2022 Economic Bulletin also includes a feature article with the preliminary results of an extensive survey the CBCS conducted on the effects of red tape on business performance and economic growth in Curaçao and Sint Maarten.1 (1 The in-depth analysis of the survey responses will be published in a research paper in the last quarter of 2022.)

A first assessment of the results indicate that the costs of red tape have been rising in both Curaçao and Sint Maarten, adversely affecting business performance and economic efficiency. Therefore, both governments should take steps to address red tape.

Public investments

“Besides structural reforms, the countries would also benefit from higher public investments, which have been low over the past decade. In this regard, a medium-term public investment program is recommended that sets clear priorities on investment projects that provide a high economic and social return and includes norms that guarantee project quality and efficiency of resource allocation,” CBCS president Doornbosch concluded.

The complete text of the June 2022 Economic Bulletin is available on the CBCS website at www.centralbank.cw/publications.


Address structural deficits in the balance of payments. Tourism remains most important pillar

SINT MAARTEN/CURACAO - “Soaring international commodity prices underscore the vulnerabilities on the balance of payments of the monetary union,” cautioned Centrale Bank van Curaçao en Sint Maarten (CBCS) president Richard Doornbosch in the Bank’s June 2022 Economic Bulletin.

“As small and open economies, Curaçao and Sint Maarten are very dependent on imports. Consequently, increases in import prices, all other things being equal, will result in a higher deficit on the current account of the balance of payments. At approximately 17% of GDP over the past decade, the deficit on the current account of the balance of payments is relatively high,” he added.

Despite a structural deficit on the current account of the balance of payments, gross official reserves have increased considerably due mainly to external financing, including the government borrowing from the Netherlands.

“Hence, the balance of payments suffers two structural weaknesses: first, a high import bill that is not covered by exports, and second, a worsening international investment position,” Doornbosch pointed out.

“Although our import coverage is currently well-above the norm of 3 months, the balance of payments situation demands actions, the CBCS president urged. “Therefore, both governments could implement policies that reduce our dependence on imports and/or increase our exports. Our oil import bill represents approximately 20% of our total imports,” Doornbosch explained.

“As the demand for fuel tends to be relatively inelastic on the short term, the current surge of international crude oil prices will result in a sharp increase in the oil import bill. It is recommended that the governments take the necessary steps, including fiscal incentives and regulation reforms, to accelerate our transition from fossil fuel to renewable energy.

“Curaçao and Sint Maarten are endowed with natural resources that can be used for alternative energy generation, such as the sun, sea, and wind. Investments in renewable energy sources will also create a new economic sector that can contribute to export revenues and stimulate economic growth,” he advised.

“Meanwhile, we have so far been able to finance the large current account deficits, but this should not be taken for granted. Therefore, policies to strengthen the current account of the balance of payments will also improve our international investment position,” Doornbosch added.

“While diversification of the economy is called for, the reality is that tourism is - and likely will be - the most important economic pillar of both Curaçao and Sint Maarten,” Doornbosch emphasized.

“In fact, the current economic recovery is primarily driven by stay-over tourism that has rebounded faster than expected. There is still scope for increasing foreign exchange earnings from tourism activities.

“First, both countries could expand their tourism sector by focusing more on niche and special interest tourism that have generally higher value added than traditional tourism. Second, the countries could benefit more from the tourism value chain by stimulating the participation of local businesses in tourism-related activities.

“Finally, fostering a skilled labor force focused on tourism will contribute to an improvement of the services and products we offer as a tourist destination thereby creating destination loyalty. These measures will increase the added value and hence the benefits of tourism for the people of Curaçao and Sint Maarten,” CBCS president Richard Doornbosch concluded.

The complete text of the June 2022 Economic Bulletin is available on the CBCS website at www.centralbank.cw/publications.


Review finds detectives left out crucial evidence in Deventer murder case

SINT MAARTEN/THE NETHERLANDS – Detectives investigating one of the Netherlands’ most high-profile murder cases of the last 20 years were guilty of ‘tunnel vision’ at the expense of the man who was convicted on appeal, a cold case investigation has found.

A review by three forensic specialists found that the investigating team ignored evidence that could have undermined the case against financial adviser Ernst Louwes, who was found guilty of killing his client, Jacqueline Wittenberg, in Deventer in 1999.

Louwes was initially acquitted of the murder, but in 2004, after two further trials, an appeal court sentenced him to 12 and a half years in jail. He has always protested his innocence.

The case became a cause célèbre following Louwes’s conviction, with opinion pollster Maurice de Hond leading a campaign to clear his name. The media storm was the focus of an award-winning podcast series, De Deventer Mediazaak, broadcast last year.

De Hond claimed in a series of articles, blogs and media appearances that the real killer was Michiel de Jong, a workman who worked in Ms Wittenberg’s home, but was later found guilty of libel and ordered to pay compensation to De Jong and his partner.

Supreme Court

Louwes’s lawyer, Gert-Jan Knoops, has asked the Supreme Court to review the case in the light of the cold case investigation, which was commissioned by Diederik Aben, advocate general at the Supreme Court. I

t is unusual for the court to ask for a criminal investigation to be reopened after the case has concluded. The review focused on the records of Louwes’s movements around the time of the murder.

In particular his mobile phone signal was picked up by a mast in Deventer shortly beforehand, when Louwes claimed he was 50km away near Hardewijk at the time.

Detectives who retraced the route connected with mobile phone masts up to 108km away, but this evidence was not included in Louwes’s case file.

The review team also noticed ‘discrepancies’ in photographs of the blouse the victim was wearing at the crime scene, in the mortuary and during the autopsy. DNA traces found on the blouse were a crucial part of the evidence used to convict Louwes.



One person killed, homes are damaged as tornado hits coastal town

SINT MAARTEN/THE NETHERLANDS – One person has been killed and at least 10 injured after a tornado swept through a coastal town in Zeeland, the local safety board has confirmed.

The storm ripped the roofs off four houses and tore down trees in Zierikzee, on the island of Schouwen-Duiveland, at around 1pm on Monday.

Fire crews and ambulances were called to Calandweg and Havenplein as the local safety board declared a GRIP 2 situation, meaning the incident could have a wider impact on the surrounding area.

Witnesses said the tornado had sent roof tiles and garden furniture flying across the street.

Weather bureau Weerplaza said the whirlwind started over the water and then moved onshore. The emergency services have urged people to stay home, not to try and help, and warned that loose branches and roof tiles still pose a danger to the public.



Dutch ministers condemn Roe v Wade decision, say safe abortion is a right

SINT MAARTEN/THE NETHERLANDS – Dutch ministers and activists have joined the condemnation of America’s supreme court judges who on Friday overturned a key decision which gave women all over the US the right to choose an abortion.

On Friday, the court abolished the constitutional right to abortion, derived from a 50-year-old legal case known as Roe v Wade. Experts say it will lead to abortion bans in about half of the states.

Foreign minister Wopke Hoekstra, a member of the Christian Democrats, said in an English language tweet that ‘today is a reminder that the struggle for the rights of women is never over’.

The Netherlands, he says, ‘stands firmly for the health and rights of all women and girls around the world to be able to decide about their own bodies and lives.’

Foreign trade minister Liesje Schreinemacher made similar comments on Twitter. ‘The Netherlands believes safe abortion is a right and is key to prevent maternal mortality,’ the minister said.

Other prominent experts and activists went public with their reactions to the news. Virologist and government health advisor Marion Koopmans described the ruling as ‘a sad day’, while Bij1 MP Sylvana Simons said that a ‘ban on abortion means a ban on safe abortion’.

‘Whoever limits it has more blood on their hands than those who opt for an abortion,’ she said.

Dutch law

Abortions can be carried out in the Netherlands up to 22 to 24 weeks, but half of all abortions are at less than eight weeks. The Netherlands, which allowed abortion as recently as 1984, also has one of the lowest abortion rates in the world.

Meanwhile, the Dutch humanist association Humanistisch Verbond has launched a petition to have Dutch abortion law removed from the criminal statute books.

Abortion in the Netherlands, the organisation points out, is technically illegal but can be carried out in a licenced hospital or clinic. ‘The time is right to change this for good,’ the organisation says. ‘We have seen what can happen in the US if the right to abortion is not anchored in law. The law in the Netherlands is vulnerable too.’


The organisation argues that abortion should fall under regular healthcare, ‘so that you can go to the healthcare provider of your choice, that there are no taboos and, most of all, that the right to freedom of choice is properly enshrined and protected in Dutch law.’

Earlier this month, senators voted to scrap the five-day waiting period for an abortion and senators will also debate later plans to allow family doctors to prescribe abortion pills.



Schiphol to offer fewer flights from 2023 as ministers get tough on noise, pollution

SINT MAARTEN/THE NETHERLANDS – Schiphol airport will be able to offer no more than 440,000 take off and landing slots per year from November 2023, infrastructure minister Mark Harbers confirmed on Friday.

The figure represents a 12% cut in the current total, which the airport is currently close to breaching, and would see traffic back at 2014 levels. The reduction is necessary to cope with noise and other forms of pollution, Harbers told MPs in a briefing.

A ‘new balance’ is needed between ‘the importance of a good international airport, a good business climate and the importance of a better and healthier living environment’, Harbers said.

‘It is an illusion to think you can have 500,000 flights in this situation,’ he said. ‘Local residents are inconvenienced by flight noise and are concerned about the effects of aviation on their health, the environment and the climate.’

The news had been leaked earlier by broadcasters NOS and RTL Nieuws. Work will now start on the practicalities of the measure which will run for five years, Harbers said.

‘In the future we want to manage things differently, based on the actual noise and emissions rather than the number of flights.’


Aviation chiefs have said they doubt that the new restrictions will allow Schiphol to maintain its huge destination network, despite Harbers’ assurances.

‘It would seem as if the cabinet is deliberately strangling the aviation sector,’ said Marnix Fruitema, chairman of Barin, which represents airlines using Schiphol. ‘This has not been discussed with the aviation sector and conflicts with the coalition accord.

It will also make flying impossible for people on low incomes,’ he said. Schiphol has been forced to cancel hundreds of flights this summer because of the shortage of staff and to avoid long queues.

Harbours also confirmed that the government will not take a final decision on what to do about Lelystad airport, earmarked to take over some Schiphol traffic, until 2024.



Rain forces royals to pose for summer holiday photos indoors

SINT MAARTEN/THE NETHERLANDS – The Dutch royal family have once again posed for their annual summer photographs, but bad weather forced the king, queen and their three daughters to move the session from the beach to the Noordeinde palace in The Hague.

The summer photo session marks the start of the royal family’s summer break and is meant to ensure that their actual holiday remains free of Dutch paparazzi. They also traditionally pose in the Austrian alps while on a winter sports trip.

However, this year the state information service RVD said the sessions would only take place when all members of the family are together. Alexia, their middle daughter, is currently attending Atlantic College in Wales.



Willem Holleeder loses appeal, is guilty of ordering contract killings

SINT MAARTEN/THE NETHERLANDS – Dutch crime boss Willem Holleeder has lost his appeal against a life sentence handed down to him in 2019 for his role in five contract killings.

The appeal court said there is sufficient evidence that Holleeder ordered the killings between 2003 and 2006. The victims included Holleeder’s brother-in-law Cor van Hout, who collaborated with him in the kidnapping of beer magnate Freddy Heineken in the 1980s.

In particular, the evidence of key witnesses was crucial in obtaining the conviction, including that of Holleeder’s two sisters Sonja and Astrid, the court said. ‘But this is not about the word of Holleeder against that of his sisters,’ the court said.

Holleeder and his legal team insist there is no evidence linking him directly to the murders, and nothing via phone taps or dna research. The case, which started in 2018, ran to a thousand files with a total of 500,000 pages.

Holleeder will now appeal to the Supreme Court. That court will not look again at the evidence, but will decide if proper procedures were followed during the appeal hearing.



Legalise ecstasy and cannabis to combat drugs crime: think tank

SINT MAARTEN/THE NETHERLANDS – Dutch drugs criminality could be tackled by legalising ecstasy and cannabis and by a taking a much tougher approach to cocaine smuggling, an independent think tank has said in a report out on Thursday.

The Dutch need to work on a ‘credible’ policy when it comes to drugs crime, think tank DenkWerk said in its evaluation and that includes measures such as closing down port terminals which are not doing enough to intercept drugs transports.

The think tank, which includes professor and economist Barbara Baarsma and ING supervisory board chief Hans Wijers, based its recommendations on interviews with 25 representatives from police, customs, the public prosecution office, ports and journalism.

Legalisation, one of the report’s key recommendations, would deprive criminals of hundreds of millions of euros in profits, the experts said. At the same time, it would tackle the illegal dumping of chemicals and discourage youngsters just out of school from getting involved in drugs crime.

The government needs to take over the national drugs market for cannabis and ecstasy as quickly as possible, the think tank said, with tax tariffs and banking facilities for licenced dealers.

For the plan to work, a simultaneous policy to discourage the use of ecstacy, cannabis and cocaine needs to be in place, with a restriction on the number of outlets, age specification and a strict check on the number of pills.


Government action against cocaine smuggling should be much more repressive, the report says, because the effects of cocaine use on health are more severe and production takes place abroad, which limits national measures.

The Netherlands is the ideal environment for the international drugs trade Some 50% of all cocaine smuggled into the Netherlands is being intercepted in the ports, DenkWerk claims.

The figure, which is considerably higher than the common estimate of 20%, is based on European consumption of the drug, production figures from South America and the amount of cocaine intercepted in the ports of Rotterdam and Antwerp.

‘That number came as a big surprise to us as well but it gives us hope. Big volumes of drugs can only enter the country via container ports. Targeted investment can help intercept many more transports and push drugs criminals to other countries,’ Baarsma told the NRC.


Ports must also consider their role and be made more responsible, Baarsma said. ‘If a terminal fails to act against drugs smugglers they should be warned and, as a last resort, closed down.

They are a crucial link in the chain and they have to take their social responsibility seriously.’ The increased use of shipping containers to conceal drugs has made the high volume ports of Antwerp, Rotterdam and Hamburg the new epicentre of the European cocaine market, according to a report on the industry by European police organisation Europol last year.

The ambitions set out in the report will probably meet with political resistance, Baarsma said, not least because it would mean more pressure on already scarce legal resources. Tackling drugs criminal is possible, Baarsma said. ‘It’s not a drop in the ocean. We don’t think so. There’s hope but only if the current policy is overhauled.’



Police to try to trace farmers who broke the no tractors rule

SINT MAARTEN/THE NETHERLANDS – A day after farmers caused chaos on the roads by illegally driving their tractors onto motorways ahead of a mass demonstration, police are attempting to identify drivers who defied the law.

Many farmers reportedly hid their number plates, making it impossible to trace them, but police say they will make an extra effort when it comes to dangerous situations on the road.

In addition, the police response to the protest is also being looked at, following complaints that they could have done more to end the traffic problems, broadcaster NOS reported.

Police chief Willem Woelders told television current affairs show Nieuwsuur that he did not have the impression police had failed, adding that agreement had been reached with farmers’ organisations in advance about not using the roads.

‘And then you see a large group who decided between them to hit the motorways anyway,’ he said. ‘We tried to stop them at places where we expected problems and in some places we managed it.

But there were so many of them you cannot be at every slip road.’ Police had few other options to stop the tractors, particularly from a road safety perspective, he said. The police would hold talks with local mayors and ministers to decide if the approach should be different next time.

Should the preference be to use the military police, which has a number of armoured vehicles at its disposal, then politicians should take the decision, he said. In one incident on Wednesday, a tractor and a lorry were involved in a collision on the A12 near Ede.

That resulted in three people, all of whom were sitting on the tractor, being taken to hospital.


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