WILLEMSTAD – The General Pension Fund of Curaçao (APC) expects its financial position to strengthen further in 2027, but the pension institution is also preparing for a continued increase in benefit payments as the number of retirees grows faster than its active membership.
According to APC's 2027 budget, which reached the Curaçao Parliament on October 9, the fund projects a funding ratio of 117.9 percent by the end of next year.
The figure indicates that APC expects its assets to exceed its calculated pension liabilities by approximately 17.9 percent.
This provides an important financial buffer, although the fund must continue to account for future pension obligations, investment risks, and changing demographic conditions.
APC is also projecting a positive financial result of approximately XCG 67 million for 2027, based partly on an expected average investment return of 5.1 percent.
However, the budget also shows that the cost of paying pensions is continuing to increase.
The fund expects total pension payments to approach XCG 262 million in 2027, compared with approximately XCG 243 million in 2025.
That represents an increase of roughly XCG 19 million, or nearly 8 percent, over two years.
One of the factors contributing to the increase is the growing number of pensioners.
According to the budget, the number of retirees is expected to rise by approximately 3 percent, while the number of new active participants entering the pension system remains relatively limited.
This demographic development creates a long-term challenge for pension funds because a growing number of beneficiaries must be supported by a pension system with comparatively slower growth in active contributors.
Although APC maintains an investment portfolio to finance future obligations, rising pension payments require careful planning to ensure that sufficient liquid resources remain available.
The fund must balance its current payment commitments against the need to preserve capital and generate returns for future generations of pensioners.
The projected improvement in APC's funding ratio is therefore significant, but it does not eliminate the financial pressures associated with an aging membership.
The budget also assumes a pension indexation of 0.75 percent in 2027.
That figure has not yet been approved as a final pension adjustment and remains subject to the applicable financial and regulatory conditions.
The limited projected increase illustrates the balance APC must maintain between improving benefits for existing retirees and protecting the fund's long-term financial sustainability.
Pensioners have accumulated an indexation shortfall following several years without regular increases.
Earlier reporting indicated that a partial adjustment of 0.51 percent was granted in 2026, leaving an estimated outstanding indexation gap of approximately 4.69 percentage points.
Despite the projected improvement in its financial position, APC has not included a specific timetable in its 2027 budget for eliminating that accumulated shortfall.
The figures highlight two developments that will shape the pension fund's future: improving investment and financial projections on one side, and rising pension obligations on the other.
For APC, maintaining sufficient reserves and liquidity will remain essential as the number of retirees continues to grow.
For pensioners, the question is whether the fund's stronger financial position will eventually create sufficient room for larger benefit adjustments without compromising its ability to meet future obligations.