WILLEMSTAD - The debt resolution for Ennia will result in an increase in government debt, according to Lidewijde Ongering, the chairman of the College financieel toezicht (Cft). She conveyed this in a letter to the Minister of Finance, Javier Silvania. Ongering believes that an increase in government debt is highly undesirable.
The additional interest expenses, alongside other government expenditures, will limit Curaçao's ability to finance economically viable investments in the coming years. These interest expenses are included in the Kingdom Act on Financial Supervision (Rft) to prevent an unsustainable debt position for Curaçao.
The debt burden must not exceed 5 percent of the average realized joint income of the public sector of Curaçao. According to the Cft, this could put future returns on Ennia under pressure, and it is uncertain to what extent Ennia can meet the interest obligations to the government for many years.
An agreement has been reached between the Netherlands, Curaçao, Sint Maarten, and the Central Bank of Curaçao and Sint Maarten (CBCS) for the Ennia solution. The solution involves recapitalizing Ennia with subordinated loans from Curaçao and Sint Maarten, financed by the Netherlands, with a total amount of 600 million euros.
"The Dutch Council of Ministers approved the solution at the end of August. However, approval from the First and Second Chambers is still required," stated the Cft.