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Dutch Caribbean islands, facing money shortage, balk at Netherlands reform-for-aid package

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Posted: Wednesday, September 9, 2020. 7:27 pm CST.

By Aaron Humes: According to Nick Ottens, opinion writer for the Atlantic Sentinel, politicians on the autonomous Dutch islands of Aruba, Curaçao and Sint Maarten are balking at accepting aid from the former colonizer based on reforms to their governments, to be managed by temporary Dutch administrators. 

COVID-19 has halted tourism on these islands, like their Caribbean counterparts, and tax revenues have dried up while unemployment has soared. Their time is currently measured in weeks before they run out of supply. 

Facing a collapse of the health system, Aruba has met most of the Dutch demands except for capping public sector wages at 130 percent of the prime minister’s salary. A similar rule was introduced in the European Netherlands in 2013. Employers and the Aruba Chamber of Commerce have urged the government to comply. 

The island has more than 2,400 cases of COVID-19 in a population of 105,000, and its government needs up to nearly 600 million euro in the coming year to meet budget shortfalls. It is projected to run out of money in mid-September. 

Curaçao, the largest of the islands, only has 92 cases, but its economic situation is particularly dire, with the government forced to choose between paying civil servants and suppliers. Curaçao has so far received 180 million euros from the Netherlands. Another 50 million euro is on hold, pending approval of Dutch demands for economic reform. The government expects it will need another 250 million euro next year. 

And, in Sint Maarten, which shares an island with French Saint-Martin, there are 500 COVID-19 cases in a population of 40 thousand which was still recovering for Hurricane Irma. It has received 26.5 million euro in COVID aid from the The Netherlands, but it doesn’t yet meet the requirements for the next round of support. 

The islands have already agreed to cut wages in the public sector, including politicians’ salaries. Companies are required to pay one-fifth of wage subsidies for the unemployed. Terms for additional aid include cutting red tape, lowering the cost of doing business, and speeding up permits. 

The islands aren’t opposed to these conditions per se, writes Ottens, only that they would be monitored by Dutch officials reporting to The Hague rather than the local parliaments. The Dutch argue the islands have time and again fallen short of their commitments, and appointing Dutch administrators is the only way to guarantee the reforms will be made. 

Meanwhile the other Dutch islands – Bonaire, Saba, and Sint Eustatius – are already overseas municipalities of the Netherlands and receive the same financial support that municipalities in the Netherlands itself do. Residents and businesses on the islands qualify for the same unemployment subsidies, loans, et cetera

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