WILLEMSTAD – Curaçao's government has accumulated hundreds of millions of guilders in cash reserves and continues to post budget surpluses, but the Board of Financial Supervision Curaçao and Sint Maarten (Cft) says the country still lacks a concrete strategy to reduce its debt burden and may be overestimating its ability to carry out planned investments.
In its review of Curaçao's first-quarter financial results for 2026, the Kingdom watchdog pointed to what it considers a growing mismatch between government investment plans and actual execution. While the 2026 budget includes nearly 199 million guilders in planned investments, only 6 million guilders had actually been invested during the first three months of the year.
The government is also planning to finance most of those investments through a new 186 million guilder loan from the Netherlands. However, the Cft questioned whether such borrowing will be necessary if investment projects continue to progress at the current pace. It urged the government to reassess which projects can realistically be completed in 2026 and to adjust its capital budget accordingly.
At the same time, Curaçao's liquidity position has become increasingly strong. According to government projections reviewed by the Cft, the country held approximately 329 million guilders in liquid funds at the end of March. Rather than allowing those funds to sit idle, the watchdog believes the government should consider using part of the reserves to strengthen its long-term financial position.
The Cft specifically pointed to a 370 million guilder bond loan that will mature in 2030, as well as outstanding debt obligations to the Algemeen Pensioenfonds Curaçao (APC). Given the current cash position, the watchdog suggested setting aside funds now to prepare for the bond repayment or making additional payments toward APC debt. Such measures, according to the Cft, could accelerate compliance with financial instructions previously imposed on Curaçao by the Kingdom government.
Despite repeated requests, the government has not yet presented a detailed roadmap showing how it plans to reduce its debt ratio to the stated target of 55 percent of gross domestic product. That absence concerns the Cft because Curaçao's debt burden remains significant.
In fact, the country's total debt increased during the first quarter of 2026. Government debt rose from 4.09 billion guilders at the end of 2025 to 4.33 billion guilders by March 2026, largely due to higher short-term liabilities. As a result, Curaçao's debt ratio now stands at approximately 61 percent of GDP, well above the government's stated objective.
The watchdog also drew attention to delays in several key financial governance obligations. The collective sector, which forms the basis for monitoring public-sector debt and interest-cost limits, should have been formally established for 2025 and 2026 by April 2024. The deadlines for 2027 and 2028 have also passed. In addition, statistical reports required to assess compliance with legal debt and interest norms remain outstanding.
Meanwhile, reforms within the tax collection department continue to raise concerns. Although the government has stated that a phased improvement plan is underway and that SOAB is reviewing collection procedures, the Cft said little information has been provided regarding actual implementation or results. The watchdog has requested a detailed update in the next execution report.
The overall message from the Cft is clear: Curaçao's finances currently appear healthy on the surface, but strong revenues and large cash balances must now be translated into a credible long-term strategy for debt reduction, investment execution, and financial governance. Without that strategy, the watchdog warns, the country risks missing an opportunity to strengthen its financial resilience while economic conditions remain favorable.