Government finalizes ENNIA negotiations
WILLEMSTAD - On April 11, 2024, after nearly a year of negotiations to save ENNIA, the governments of Curaçao and Sint Maarten, along with the Central Bank of Curaçao and Sint Maarten, signed an agreement to resolve ENNIA’s financial crisis. The deal was essential to prevent a collapse of the financial system and to avoid severe social consequences, as ENNIA's bankruptcy would have affected 25,000 policyholders and retirees in Curaçao and their dependents.
Following the agreement, a new government in Sint Maarten expressed differing views on the plan. This led to various media reports in both Curaçao and Sint Maarten, creating uncertainty around the implementation of the rescue plan signed on April 11, 2024, and causing concern among ENNIA’s policyholders and retirees in Curaçao. However, Curaçao’s government reassured the public that it would protect the rights of ENNIA policyholders and retirees as outlined in the rescue plan. The government appointed Caryl Monte and Miguel Jackson to work closely with the Central Bank of Curaçao and Sint Maarten to ensure the rights of policyholders in Curaçao were safeguarded.
Minister Silvania (finance) and Prime Minister Pisas signed the agreement accompanied by the President of Parliament
On September 18, government representatives informed the Council of Ministers that additional agreements had been made with representatives from Sint Maarten and the Central Bank regarding amendments to the April 11 rescue plan, proposed in an “addendum.” Sint Maarten’s parliament approved the ENNIA rescue plan and the “addendum” on October 8. The following day, Caryl Monte delivered a technical briefing on the “addendum” to Curaçao's parliament, explaining all details and addressing questions.
After the briefing, Curaçao’s parliament overwhelmingly approved the “addendum” with 15 votes in favor from both coalition and opposition members, and no votes against.
This overwhelming majority is the result of both the government and parliament concluding that Curaçao stands to benefit significantly from ENNIA’s survival. These benefits include an annual contribution of 15 million Nafl. to the state treasury through various taxes, the preservation of over 150 direct jobs within ENNIA’s companies, and the indirect economic effects of ENNIA’s local procurement of goods and services. Additionally, it was determined that the extra costs Curaçao will incur due to the “addendum” are not substantial and will not affect the annual budgeted amount that Curaçao is set to contribute to ENNIA’s rescue.
Along with the ENNIA rescue plan, the government also secured a reduction in the interest rate from 6.6% to 2.9% on loans Curaçao received from the Netherlands during the COVID-19 pandemic (2020-2021), totaling 911 million Nafl. This interest rate reduction of 3.7% will save the government around 400 million Nafl. in interest payments over 20 years, equating to an annual savings of approximately 20 million Nafl.
This interest savings clearly provides an additional advantage to the approval of the ENNIA rescue plan, as it offsets the 30 million Nafl. annual cost of the rescue. Moreover, ENNIA retains three key assets that can be leveraged in the coming years to further reduce the impact on the national budget. These assets include the claim against Ansary and others, the Mullet Bay property in Sint Maarten, and the value of shares in the new ENNIA, which together hold enough value to potentially recover all or a significant portion of the funds the government will invest in ENNIA’s rescue over the years.
In this way, the Pisas II cabinet has reached a very satisfactory conclusion in its negotiations with the new Sint Maarten government over the ENNIA rescue plan, as well as in talks with the Netherlands over refinancing the loans provided during the COVID-19 period. Securing the lowest possible interest rate on the nearly 1 billion Nafl. COVID loans was crucial for fulfilling ENNIA’s rescue obligations, especially since the Netherlands refused to waive the loans. Both objectives have been successfully achieved. Therefore, Prime Minister Pisas and Finance Minister Silvania are particularly proud of the outcomes of these two parallel negotiations, which were conducted by the same team over nearly 18 months.
There is now an efficient, effective, and solid rescue agreement in place for the policyholders, pensioners, and employees of ENNIA. This agreement has received the approval of all relevant parties, including the government of Curaçao, the government of Sint Maarten, the Central Bank of Curaçao and Sint Maarten, the parliament of Sint Maarten, the parliament of Curaçao, the Financial Supervision Board (Cft), and the Dutch government. The people of Curaçao in general, and ENNIA's policyholders, pensioners, and employees in particular, can now rest assured that the government of Curaçao has successfully restored stability to ENNIA and the financial sector.
The government has taken the necessary steps to strengthen the Central Bank's oversight and has instructed the Central Bank to continue filing reports with the Public Prosecutor's Office or initiate civil proceedings against those responsible for harming the interests of ENNIA’s policyholders, pensioners, and the community at large.
Finally, the government expresses its immense gratitude to the president and members of Curaçao’s parliament, both from the coalition and the opposition, for recognizing the urgency of this important issue and for the careful consideration with which the parliament made its decision on the "addendum" to the ENNIA rescue plan. This decision was made in the best interests of Curaçao, the 25,000 policyholders and pensioners of ENNIA in Curaçao, and the thousands of citizens who depend on them.