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CBCS keeps the pledging rate unchanged.

~Consistent with global market expectations.~

Willemstad/Philipsburg:--- The Centrale Bank van Curaçao en Sint Maarten (CBCS) decided to maintain its current monetary policy unchanged. Hence, the pledging rate will remain at 5.75%.1 This decision is based on the Federal Reserve’s (Fed) decision to leave its target policy rate unchanged until more confidence is gained that inflation is moving sustainably toward its 2% target. In addition, although the import coverage, which is the main operational target of the monetary policy conducted by the CBCS, is expected to drop slightly to 4.6 months in 2024, it will remain well above the norm of 3 months. Despite persistent uncertainties, changes in monetary policy indicators are likely to have limited near-term effects.
According to the most recent forecast, the current account deficit of the balance of payments as a percentage of GDP will drop from 15.7% in 2023 to 13.8% in 2024. Although the current account deficit is projected to decline, the 2024 forecast entails an upward revision of 0.1 percentage point from March 2024. “The expected slightly higher current account deficit as a percentage of GDP is not caused by a higher current account deficit but by a lower-than-earlier projected nominal GDP level of the monetary union. The current account deficit is expected to decrease, reflecting a sharper projected increase in the net export of goods and services, moderated by a weaker improvement of the current transfers balance”, described executive director Dr. Jose Jardim. “The net export of goods and services will increase in 2024, driven primarily by a gain in exports, moderated by higher imports. The export growth is sustained mainly by higher foreign exchange receipts from tourism activities. Meanwhile, the projected increase in imports is due primarily to higher merchandise imports. Especially, merchandise imports by the wholesale and retail trade sector is expected to go up, reflecting increased tourism spending and higher domestic demand across the monetary union. The ongoing private investments across the monetary union will also result in higher merchandise imports by the construction and utilities sectors”, he explained.
After increasing in 2023, gross official reserves declined by NAf.71.4 million up to May 2024. The decrease seen so far is attributable mainly to the withdrawal of dollar deposits by the commercial banks and institutional investors at the CBCS, mitigated by transfers from abroad by the World Bank in connection with the reconstruction of Sint Maarten, pension funds and the Dutch Ministry of Finance, and the net sale of foreign exchange by the commercial banks to the CBCS. Even though gross official reserves are projected to decline slightly in 2024, the average import coverage is projected at 4.6 months in 2024, down from 4.7 months in 2023 and well above the norm of 3 months.
1 The pledging rate is the rate at which commercial banks can borrow at the CBCS in case of a liquidity shortage.
Meanwhile, the commercial banks’ liquidity is showing a decreasing trend. During the first 5 months of the year, liquidity decreased by NAf.128.4 million, driven primarily by the net withdrawal of dollar balances at the CBCS, the increase in required reserves, and the net purchase of CDs.
The last adjustment of the U.S. Federal Reserve (Fed) funds rate took place in July 2023, and it has been kept unchanged so far in 2024 due to a moderating but still elevated inflation. The US inflation is expected to remain around 3.0% in 2024. Therefore, the Fed is expected to maintain its policy rate unchanged until it has gained greater confidence that inflation is moving sustainably toward the target of 2%. Nevertheless, future adjustments of the Fed funds rate range will depend also on the economic outlook and balanced risk factors. “Given the expectation that there will be no change in the Fed funds rate in the short term, interest rates in the international money market are likely to remain relatively stable. Consequently, the CBCS anticipates minimal impact on the interest rates in the money market of the monetary union of Curaçao and Sint Maarten, considering that the NAf. is pegged to the U.S. dollar”, Dr. Jardim explained.
“Against this background, the CBCS decided to leave the pledging rate unchanged at 5.75%, which is 25 basis points above the Fed funds rate. Furthermore, the CBCS will continue to offer longer maturities (i.e., 12, 26, and 52 weeks) on its bi-weekly auctions of CDs with the aim to hold bank liquidity longer domestically to support the preservation of a solid foreign exchange position”, Dr. Jardim ended.


Willemstad June 17, 2024
CENTRALE BANK VAN CURACAO EN SINT MAARTEN


Strategic Options for Ennia Aruba.

WILLEMSTAD/PHILIPSBURG/ORANJESTAD – The Centrale Bank van Curaçao en Sint Maarten (CBCS) is currently exploring strategic options for Ennia Caribe Holding (Aruba) N.V. (ECHA) and its subsidiaries (Ennia Aruba). These financially sound subsidiaries operate under the supervision of the Central Bank of Aruba (CBA). In this context, constructive discussions have taken place between the CBCS and the CBA regarding a possible transaction involving Ennia Aruba and protocols for information sharing throughout the transaction process. On May 24, 2024, these discussions culminated in the signing of a Process Protocol between the CBCS, the CBA and (ECHA's parent company) Ennia Caribe Holding N.V. (ECH).
In the coming months, the CBCS will explore strategic options for the Aruban operations of the Ennia Insurance Group, taking into account the interests of both Ennia Aruba and its policyholders, as well as those of the broader Ennia Group and its policyholders. Any change of control resulting from the above process will require the prior approval of the CBA. The CBCS and the CBA will therefore work closely together in the coming months to ensure that this process is as efficient and effective as possible.
Willemstad, June 17, 2024 Oranjestad, June 17, 2024
CENTRALE BANK VAN CURAÇAO EN SINT MAARTEN CENTRALE BANK VAN ARUBA

Power barges are too expensive PM tells parliament.

~Parliament tells COM that he cannot equate Crisis with too Expensive. ~

PHILIPSBURG: --- Prime Minister Dr. Luc Mercelina told parliament on Monday during a Central Committee meeting that the power barge that NV GEBE was thinking about leasing is too expensive for NV GEBE and the country.

Mercelina said that the other option NV has at its disposal is to lease the containerized generators. While breaking down the projected cost to at least the power barge or the containerized generators, he did not say when a definite decision will be made to move forward with the leasing of the containerized generators, which would take at least three months before they arrive on St. Maarten.

Mercelina said that NV GEBE would know by Friday if the crankshaft for engine 19 can be repaired.

Member of Parliament Omar Ottley broke down the presentation given by Prime Minister Dr. Luc Mercelina and said that the Prime Minister used words like crisis, safety, and security. Then, he concluded that the barge was too expensive. He asked the Prime Minister if there was a price tag on the safety and security of the people. Ottley further stated that the prime minister did not provide parliament with any new information because everything he told parliament on Monday was stated last Wednesday in the Council of Ministers press briefing.

Member of Parliament Ardwell Irion, the former Minister of Finance, questioned the Prime Minister on his statements from the moment he took office. He said the same thing: the Prime Minister and his cabinet have said the country is bankrupt. If the country is bankrupt, how can the country (Government) be the financier for NV GEBE? “I would like to know who will lend and bankrupt country money and what will be the interest rate. Will it be 10%, which is above the market rate?

Ardwell further questioned the Prime Minister on the EU funding he mentioned in the presentation. He wants to know if the Netherlands or St. Maarten have the necessary legislation to access those funds. He also asked if GEBE could access the fund independently.

Member of Parliament Ludmilla De Weever made the following statements "Whether I am part of a coalition or in opposition, every solution that I have come up with, every advice that I have come up with, from my past and my experience, is one for the country. Every time I share information, it is for the benefit of the public. That is who I represent. When I was part of the opposition last time, I also emailed solutions to the then minister of VROMI, which was ignored.
Again, I offered solutions, advice, and suggestions to this coalition.
Every time I am here, I represent the greater interest of our Sint Maarten public. This coalition and the prime minister have indeed taken my advice. What I wanted to hear today is, 'OK, Sint Maarterners, we are going to have to load shed for the near future, for the foreseeable future, and within the next six weeks or two months, we are going to have these containers (generator) here. That's it—a very simple solution.
I know that everyone is talking about financing and everything that comes with it, but it is literally just a matter of, as most of the people, whether coalition or opposition, have been saying today: Here is the short-term solution. We have a financing schedule coming out of it, and I hope that when we have another meeting, we will have something that is more than just words, therefore for public consumption.
This is not me pointing out the errors of a past government or this government. We just need to move forward right now. June 1st marks the beginning of hurricane season.

I have been ignored when I've offered solutions in the past, but I wasn't ignored 100% this time around."

 

PM begs parliament not to play politics with the GEBE crisis.

~ UPP and NA call on the Council of Ministers to provide solutions. ~

PHILIPSBURG: --- Leader of the United Peoples Party Omar Ottley called on Prime Minister Dr. Luc Mercelina and his cabinet to provide the parliament of St. Maarten with solutions to the GEBE crisis. Ottley made clear that he personally did not see the presentation Mercelina gave parliament in the closed-door segment of the Central Committee meeting held on Monday morning. He said that the Prime Minister is pleading with parliament not to play politics with the GEBE crisis.

He asked where is the plan to deal with the crisis when exactly will the population of St. Maarten receive relief? Ottley made clear, that it does not matter if the Mercelina cabinet is in office for six weeks or two weeks, reality is they are there now, and the people want relief.

Member of Parliament Akeem Arrindell shared the same sentiments as his party leader and asked for tangible solutions.

Member of Parliament Viren Kotai asked the board of NV GEBE who is to blame for the crisis the current council of ministers inherited. He advised the management of NV GEBE and the Council of Ministers to approach APS to secure finances to deal with the problems NV GEBE is facing. Kotai said that so far, based on what he read, NV GEBE has not defaulted on their loans for the past 20 years. He said that APS has invested overseas and has no return on their investments. He asked when the last time the financial statements of NV GEBE were audited and where exactly they had looked for financing.

Member of Parliament of the National Alliance Cloyd Marlin questioned the Prime Minister on his statements regarding political rhetoric and the fact that members of parliament supporting the 2 x 4 coalition have made statements that have blamed the former council of ministers. Marlin called on parliament and the council of ministers to do what is right by having a meaningful discussion that will bring about solutions.

Marlin asked who the Chief Operations Officer of NV GEBE was. He said that person is now sitting in the executive branch of the 2 x 4 government. Marlin said that person could have brought solutions to the crisis.
 Marlin asked about the solutions that NV GEBE has on the table. He asked what the cost of an electricity barge to St. Maarten will be and how long it will take.

Member of Parliament Christophe Emmanuel said he would sling mud and blame the former government, namely UPP and National Alliance because they were the worst government to have been in office for a full four-year term. He said the 2 x 4 did not give the Grid market any exclusivity. He also said that it was the former government that appointed the members of the supervisory board and the Temporary Manager.
Emmanuel described the former government as a set of vindictive people, he even mentioned the fact that he could not obtain a building permit for his business, he indicated that since the 2 x 4 entered office he received the permit.

He asked the Council of Ministers how it was possible that they were able to get rid of the Chief Executive Officer of TELEM and the Director of the Kadastre but they are not able to remove the members of the Supervisory Board of NV GEBE and the Temporary Manager of NV GEBE and the Chief Executive Officer of PJIAE.

Emmanuel further stated that St. Maarten is not in a crisis but instead it is in a comatose state, he said since the doctor took the helm, he amputated the arms and limbs of NV GEBE and did not provide the prosthetic limbs to hold the company up. He cautioned the Prime Minister that he was not pulling his support from his 2 x 4, but there were times when they had to hear harsh statements.

Emmanuel said he does not believe anything that GEBE tells the parliament or the people of St. Maarten simply because he does not trust them. He further said that the government he supports said they could do a better job; thus, he wants Prime Minister Dr. Luc Mercelina to present parliament with the solutions his experts and advisors provided him with. He asked what the plans NV GEBE has in place to compensate its customers for their damaged appliances are.

He asked if the chief engineer resigned from NV GEBE? And the reasons behind the resignation.

UPP MP Francisco Lacroes called on parliament and the government to stop their game-playing and begin to tell the truth. Based on the stack of old newspapers and motions he has, the same members of parliament passed in 2011.

Lacroes said that if the parliament of St. Maarten and the council of ministers did not stop the political rhetoric, he would open a “bobol” on the floor of parliament.

WINAIR Acquires Twin Otter Aircraft to Enhance Operations.

winaircomgroup17062024PHILIPSBURG:--- Winair announces a significant milestone in its history, transitioning from a fully leased fleet to ownership with the acquisition of a Twin Otter DHC6 aircraft. This investment marks a strategic move towards greater operational control and efficiency, solidifying the company's commitment to providing exceptional service in the Caribbean.

Demonstrating the aircraft's importance to our operations and the current economic climate, a strong business case was presented to our shareholders. Recognizing the long-standing success of Twin Otters, the improved efficiency, and the potential for a more competitive future, our shareholders responded positively and overwhelmingly approved the acquisition of this DHC-300.

The Honorable Prime Minister, Dr. Luc Mercelina, on behalf of the shareholder representative, commented on the acquisition, stating, "This is a significant development for Winair and for St. Maarten as a whole. The acquisition of the Twin Otter DHC6 represents a commitment to enhancing our aviation infrastructure and supporting economic growth in our region. We are proud to see Winair taking such strategic steps to strengthen its operations and continue its legacy of reliable service."

“For nearly five decades, Twin Otter aircraft have been the backbone of our operations, particularly for essential routes Saba and St. Barth,” said Hans van de Velde, CEO at Winair. “The decision to acquire this aircraft reflects our long-standing experience with the Twin Otter’s reliability, coupled with the current economic climate and the health of our company. This strategic purchase allows us to reduce our reliance on leasing and paves the way for future growth.”

The Latest in Regional Aviation

The Twin Otter DHC6 which Winair will acquire, is the latest addition to our fleet, PJ-WIX. And it represents the latest evolution in the Twin Otter series. Equipped with a state-of-the-art Garmin 950 glass cockpit, this aircraft offers enhanced navigational capabilities, improved pilot situational awareness, and a smoother flying experience for passengers. This advanced technology positions Winair at the forefront of regional aviation, setting a new standard for efficiency.

Building a Stronger Future

Winair is confident that this acquisition will not only enhance operations but also contribute to the company’s long-term financial stability. Winair hopes and expects this a first step, to be followed by the acquisition of other twin otters in the upcoming years. Owning aircraft allows for greater control over maintenance schedules and operational costs, ultimately allowing us to continue delivering exceptional service and value to its customers. 


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