Two weeks ago, it was the proverbial "back to school" and for the island council of Sint Maarten back to work after the annual recess. Quietly the first year of this administration’s 2007-2011 term came and passed on July 2nd last.
The month of August therefore is as good a time as any to reflect on the past year and give a synopsis of government’s actions and accomplishments during the recent past.
Over the course of this past year, government officials have given insight into these actions of government through the weekly press briefings of the Executive Council as well as other periodic briefings on particular topics.
The past months stand out with all the economic whirlwinds, as the whole world faces the backlash of skyrocketing oil prices and the rise of cost for related and non related commodities.
After many months of intensive consultations in the area of constitutional developments, it might seem as if parties have gone back to their individual drawing boards. Nothings is further from the truth.
Fact is that we have again arrived at a critical junction in the constitutional negotiations, that require vigilance as we seek to safeguard not only momentarily successes, but even more so, to establish the right footing for the future, and our position as country within the Kingdom of the Netherlands.
This was evident in the area of the financial agreements and in particular the formulation of the transitional financial supervision.
The key here being that this measure of supervision, regulated by Kingdom resolution, expires with the creation of country Sint Maarten.
Of course, there are voices suggesting that the same financial supervision regulation mutatis mutandi be applied in the case of country Sint Maarten.
This thinking however is in blatant conflict with the agreement of November 2, 2006, where the 2 phases of before and after country status are clearly separated. The consensus Kingdom law to be established regulating the financial relations in the future must reflect the transition from island territory to country Sint Maarten.
Implementation of the transitional measure is well underway with talks between the CFT (Council of Financial Supervision) and the Commissioner responsible for Finance, Mr. Roy Marlin.
In addition, the general management of the public sector has received the first presentation of the implications of this measure for the daily operations of the different sectors of government.
In the meantime, the first budgetary amendment for 2008 is on its way to the island council for deliberations.
Another area of dispute has been the interpretation of the agreement to establish joint operations between the police forces of the new entities.
The crux hereby being the point of departure that country Sint Maarten will have an independent police force, accountable to the Minister of Justice of our country Sint Maarten.
None of the above however until now has resulted in a breakdown or termination of talks to come to a solution. The holiday period did not prevent our technocrats and advisors from continuing their deliberations on these matters to come to acceptable proposals for all parties.
In addition, the first attempts to come to the necessary amendments to the Charter of the Kingdom have been made. These amendments are a prerequisite for the status of country to come into effect.
All sectors of government continue the exercise of developing a transition plan for the respective sectors to evolve from island territory to country.
In some instances, this transition requires a minimal design, in other instances, e.g. in the case of the Ministry of Justice, we are literally building from scratch.
The finalization of the island government’s organization recently adopted in the island council, is also a step closer to the organizational design of country Sint Maarten.
This organization of the island government administration however, involves much more than only the design of the organizational sectors.
The package includes compensation, evaluation and placement of civil servants, all tedious processes.
The government is therefore pleased to announce that following the approval of new teachersâ?? scales, the new salary scales for all government workers have been approved by the Executive Council of Sint Maarten.
It is also during the past months that we have come to the conclusion that the much heralded date of December 15, 2008 is no longer attainable as the date for the new countries in the Kingdom to be created.
However, given the ending of the current parliamentary term in 2010, this has now become the new focus for completion of the tasks involved with the transition from island territory to country.
December 15th 2008 is now being seen as the date on which especially the legislation necessary for the new countries must be established.
In this respect, I can announce again- that the constitution for country Sint Maarten has been drafted, vetted and redrafted, and is now subject of debate especially within our community, as all of us will have to live with it and by it.
Most, if not all organic laws, resulting from the constitution, have also been prepared. And so with the organizational plans for country Sint Maarten, the constitution and organic laws, St. Maarten is well prepared for the conference in December of 2008.
Two other important aspects related to the conference of December are those of good governance and financial management.
With reference to good governance several initiatives are ongoing.
Suffice it to mention here, the integrity trajectory within government at this very time and approved and/or ongoing programs such as e-government, communication and pr, and training of the civil service.
But good governance is not only about integrity and transparency.
It is, as some would rightfully argue, especially about the service to the population. When late this year, early next year the administration moves into the new building, a great step would’ve been made towards improved service to the public.
As an island in development and rapidly so, we have been constantly challenged to keep up our infrastructure at the pace of that development.
I dare say that the last years we have been quite successful in confronting that challenge. Philipsburg is an example of this success.
And there is more to take place in Philipsburg, as we upgrade our capital from the beach front to, and including the Great Salt Pond.
The commissioner in charge of the infrastructure, Commissioner Heyliger has now embarked on another of this government’s commitment; the beautification of our neighborhoods, in particular the areas of St. Peters and South Reward.
Two infrastructural priorities for this government remain the waste and sewage disposal. Both these items are at the top of government’s agenda and while we admit the process is slow and not very tangible yet, rest assured that work is being done in both areas.
Much has been said and reported about the Social Economic Initiative, a program that also addresses the priority areas for this government, the required finances and sources of financing.
The most recent development in this area being the implementation plan for the SEI. The government in developing this implementation plan has had to consider the resources, both human and capital, necessary for the execution of the 3 year ambitious SEI.
Commencement of the Social Economic Initiative (SEI) will result in a capital injection of 52 million guilders over three year, in the following areas:
a. Spatial planning and traffic congestion:
Many of the initiatives are geared towards reducing traffic congestion and the problems with waste management.
b. Development of SME and economic diversification
c. Additional funding has been provided for the Small Business Development Foundation which facilitates small business development
d. Tourism marketing
Increase funding for marketing geared towards developing niche markets.
e. Labor market and education
The policy objectives are to increase local youth participation in the labor market, and the synchronization of the labor, education and economic policies to reduce the mismatch in the labor market.
f. Regulation
Policy objectives focus on improving the investment climate by removing red tape and ensuring a transparent and reliable business environment.
g. Government finance
Policy objectives will center on increasing government revenues by primarily upgrading our tax office to a more modern one. Review of the tax system is an integral part of this upgrade.
h. Data
This includes such projects as a Sint Maarten CBS (Central Bureau for Statistics)
i. Social issues
Objectives include increasing the number of affordable government housing for the lower income brackets. Funding has been allocated for the building of additional units, and plans such as the Hope Housing Project are underway.
In the economic sector, recent indications and trends in our economy have been illustrated by Commissioner for Economic Affairs, Mrs. Maria Buncamper Molanus.
Conclusion from these indications and trends is that our economy remains resilient in the face of global challenges. Challenges however that we need to remain ever mindful of. We are not out of the woods and effects are yet to felt in some areas.
Noteworthy in this respect are the changes to business environment regulations by Government, such as directors’ licensing policies, economic zoning, business openings, and currently under discussion the so-called tax holidays.
Work is progressing, albeit it slow in the areas that have been/are being transferred to the island territory.
Taking much too long in our view is e.g. the transfer of the tax department. Ongoing are the laboratory, the department of labor and we hope with our recently approved telecom policy, that telecommunication will not lag far behind. Winair, we hope notwithstanding the recent political rhetoric, to accomplish its transfer in the near future.
Government’s budget currently stand at approximately 200 million NA guilders. It is for this reason that we constantly seek ways and opportunities to complement this with money available to us from other sources.
Noteworthy are of course the Dutch development aid programs, executed under the auspices of USONA, including the Harbour Buy Back Program, details of which are known, and the funding agency, Reda Sosial.
An important component of the island budget and the Dutch development funds is EDUCATION!
Government has not wavered from the premise of allocating approximately 1/3 of the island’s budget to education. In addition to this, Education is a key element of the Dutch development programs.
A new educational program between the island territory and the Dutch Government (USONA) has recently been signed, in which emphasis is placed on vocational education, integral second chance education and compulsory education.
With respect to the latter, government while insisting that the Central government recognizes and accepts the link between uncontrolled immigration and compulsory education, is nevertheless cognizant of the fact that we need to do what we can and with the resources available to stem the tide. A rising tide of uneducated youngsters growing up in our community.
If the solution was a easy as some tend to purport, it would have been done many years ago.
We can not close our eyes to the reality that uncontrolled immigration, while not our legal responsibility, has been used by many of us for economic motives and facing that reality, solving the problem becomes a shared responsibility as well. The business sector primarily needs to recognize this fact.
Something that has also become evident due to the economic immigration, is the need for higher vocational education.
VSBO is not the panacea, but with it being part of our system, the need for higher vocation education opportunities locally on Sint Maarten is more than evident.
While for VSBO students too, the possibility exists to continue their studies else-where, the number of VSBO students is too high, not to allow a maximum amount of these students to continue their studies, especially locally.
The SBO programs which are currently being announced and coordinated by the Advanced Vocational Education Service Center serve to bridge this cap and the plans for a locality (school for higher vocational education) are in the drafting phase.
A phase will should result in plans that can be put on bid for construction of this facility early next year.
Clearly government is on a path of diversifying its tourism markets with a view to Europe ( the Netherlands) and South America primarily, such in close collaboration with the private sector. We have been able to hold our own until now, but permanency is a luxury in this rapidly changing environment.
No where is this more evident than in the global economic environment. Crude oil costs are the determining factor driving up gasoline and energy prices and by extension every other economic activity. Its impact on Sint Maarten is evident, especially on the cost of living.
Combined with the housing crisis in the United States, the U.S. economy suffered a downturn and faces a looming recession. Our island’s economy is heavily dependent on the US economy for both tourism and the importation of commodities.
Sint Maarten imports practically all its goods.
Therefore, as prices increase internationally for commodities that are imported into Sint Maarten, consumers will unavoidably have to pay more for the same item, the so-called Imported Inflation.
An example that we can all relate to is the increasing price of many European products (dairy products, milk, cheese) due to the depreciation of the U.S dollar against the Euro.
Several measures to mitigate this have been introduced by government, such as:
1. Consistent and Increased Price Control of the 12 controlled food items.
2. Monthly publication of the price control comparisons in the local newspapers and on the internet (www.stmaarteneconomy.com)
a. This has stimulated competition among the various supermarkets, and lead to more competitive prices for the consumer.
3. Introduction of a Multi-Disciplinary Control Unit/Exercise
a. The premise is to reduce the informal economy and ensure that all businesses and individuals comply with the law.
4. Hiring of Extra Controllers, in order to have more consistent and effective controls.
5. Review of the Basket of price control goods. Where feasible the intention is to extend the list of price control items. After discussions with the private sector stakeholders, namely the wholesalers and retailers the following new tentative items have been identified. The feasibility of adding these items is still being investigated:
a. Oats (cereal)
b. Cream of Wheat
c. Corn Flakes
d. Soy Milk
e. Corn Beef
f. Vienna Sausages
g. Tuna
Additionally, the Island Government of St.Maarten has requested the Minister of Finance to reduce the tariff on gasoline by 15 cent per liter. Reducing the tariff from 29 cents per liter to 14 cents per liter, once approved will lower the cost of doing business and the cost of living. The premise is that a reduction in this surcharge will lower the cost of fuel and energy and in turn lower overall cost.
Government has approved the reduction of gasoline products as per 12.00 oâ??clock tonight, August 25th, as follows: Unleaded gasoline from 260 c/l to 240 c/l; Diesel from 260 c/l to 220 c/l;
LPG (20 lbs) from 50.40 to 39.60 NAF; LPG (100 lbs) from 149.40 to 130.00 NAF and LPG bulk from 1.80/lb to 1.50/lb NAF.
However, the picture as painted above, requires conscious actions from the business sector and private individuals as well. The impact of world economics will force a fundamental change in perception, behavior and available choices.
Combined with government initiatives consumers are urged to:
1. Shop Around & Compare Prices (businesses will react by means of price reductions)
2. Conserve Energy & save where possible
3. Reduce Fuel Consumption (also good for the environment).
4. Engage in kitchen and back yard gardening
5. Adjust spending habits.
Many businesses have made adjustments to brace themselves for the fall-out from the economic crises on the international front.
However, to keep inflation at bay, these business decisions must also take into account the consumers.
In essence, government is convinced that we can face up to the challenges ahead, if all (government, business and consumers/workers) play their part.
Given the extensive coverage I afforded the area of Justice/Crime fighting during the past weeks, I have not included that area in this presentation.
However, rest assured that while the government supports the upgrading and reorganization efforts of the Minister of Justice and management of the Police Force, fighting crime in our opinion is priority # 1 in the area of justice.
A clear picture of the trend of crime and reduction efforts must be made available. We need to know what we are working on and what effects short term efforts have had.
The critical area in fighting crime is manpower! We look forward to concrete plans to address this shortage, short term and long term.
In a nutshell, I have provided you with the actions of government, the outlook for the future, anticipated challenges and opportunities for our island.
With the grace of God and the hard work of all, we will go forward.
"Semper Pro Grediens".