WILLEMSTAD – Curaçao’s 2026 draft budget shows a narrow surplus, but the College financieel toezicht (Cft) has warned that the figures rest on shaky ground and could easily tip into deficit. In its official advice, issued on August 14, 2025, the Cft urged Finance Minister Javier Silvania to revise and strengthen several parts of the budget before it is submitted to Parliament.
Narrow Surplus, Rising Risks
Curaçao forecasts a modest surplus of 5 million guilders in 2026, growing to 66 million by 2029. But the Cft noted that revenues are based on optimistic assumptions, while structural spending increases leave little room for setbacks.
Since 2023, government spending has grown by more than 300 million guilders, driven by higher personnel costs, improved labor conditions for civil servants, increased spending on goods and services, and new subsidies. Personnel costs alone are set to rise 10 percent in 2026 to 556 million guilders, making it the largest expense on the government’s books.
The Cft stressed that these developments are “risky” given global economic uncertainty and local budgetary fragility.
Key Concerns Highlighted by the Cft
The financial watchdog outlined six areas that require immediate attention:
Hospital financing: A long-promised solution for the struggling Curaçao Medical Center (CMC) remains unformalized, despite repeated commitments. Without clarity, it is uncertain whether budgeted funds are sufficient.
Vacancy budget: The government set aside 47 million guilders for unfilled vacancies. The Cft questioned whether all these posts can realistically be filled in 2026.
Non-tax revenues: Curaçao expects 15 million guilders from indexing fees and services, but the legislation has not yet been presented to Parliament.
Tax forecasts: The draft budget uses outdated economic growth figures. For 2029, Curaçao projects 3.5 percent growth, while the Central Bank’s latest forecast is only 2.0 percent, raising doubts about projected tax revenues.
Tourist entry fee: Curaçao expects 76 million guilders in 2027, rising to 86 million in 2029, from a new tourist levy replacing the current room tax. But the government provided no detailed justification or timeline for implementation.
Debt and investments: The budget envisions 191 million guilders in new investments for 2026, largely financed by Dutch loans. Yet, Curaçao’s roadmap to reduce its debt-to-GDP ratio to 55 percent is absent from the document.
Social Security and AOV Pressure
The Cft also flagged concerns about rising social security costs, projected to grow from 541 million guilders in 2026 to 616 million by 2029. Spending on welfare alone is expected to more than double, from 74 million in 2025 to 154 million in 2029.
The watchdog again pressed Curaçao on the lack of indexation of AOV pensions, despite continued economic growth since 2021. It warned of both social and fiscal risks if adjustments are delayed further.
Debt and Borrowing Strategy
Curaçao plans to borrow heavily from the Netherlands to fund investments, with 186 million guilders in new loans scheduled for 2026. While the Cft welcomed higher investment levels, it criticized the absence of a comprehensive multi-year investment plan tied to debt management and fiscal sustainability.
The Cft also pointed out discrepancies in the refinancing of bonds expiring in October 2025, stressing the need to correct these figures in the draft budget.
Call for Stronger Financial Management
Beyond the numbers, the Cft voiced “serious concerns” about Curaçao’s overall financial management. Multiple reform projects are underway, but the institution warned that capacity constraints mean priorities must be set and tackled step by step.
The advice also urged timely reporting on the “collective sector” — the broader government and public entities — as required under financial supervision rules. These reports are essential to monitor Curaçao’s debt sustainability and compliance with borrowing limits.
Next Steps
The Cft concluded that while Curaçao’s budget technically complies with central norms, the risks are “considerable.” It called on the government to make urgent revisions before presenting the 2026 budget to Parliament, stressing that fiscal stability depends on realistic forecasts, formalized policies, and disciplined execution.
