WILLEMSTAD, THE HAGUE – Newly released Dutch government documents provide a detailed picture of how Curaçao’s acceptance of far-reaching reform conditions in late 2020 was directly linked to the release of XCG 286 million in urgently needed COVID-19 liquidity support.
The fact that the Netherlands attached reform conditions to further financial assistance during the pandemic was already publicly known. However, documents released by the Dutch Ministry of the Interior and Kingdom Relations under the Open Government Act (WOO) show in greater detail how the timing of the payments was connected to Curaçao’s formal acceptance of the conditions and signing of the so-called country package.
A total of 118 key documents were selected as part of the WOO review. They cover liquidity support, the country packages and plans for the then-proposed Caribbean Entity for Reform and Development, known as COHO.
According to the documents, the Board of Financial Supervision (Cft) calculated Curaçao’s total liquidity requirement for 2020 at XCG 668 million.
The Netherlands had already provided approximately XCG 382 million through the first two tranches of support. That left another XCG 286 million needed for the remainder of the year.
On November 2, 2020, Curaçao formally agreed to the conditions attached to the third tranche and signed the mutual arrangement governing the country package.
According to the Dutch documents, that step cleared the way for an initial payment of XCG 105 million.
Curaçao still faced an estimated liquidity requirement of XCG 181 million for November and December. The Netherlands subsequently made that amount available as an interest-free loan.
The final loan agreement explicitly stated that Curaçao had unconditionally accepted all conditions and signed the country package before the additional XCG 181 million could be provided.
The money was to be paid in U.S. dollars, and Dutch officials intended to make the funds available within three working days after receiving the signed loan agreement.
The documents provide a clearer reconstruction of the financial mechanism underlying one of the most controversial periods in recent Curaçao-Dutch relations.
Among the conditions imposed during the pandemic were a 12.5 percent reduction in employment conditions for civil servants and employees of government entities, a 25 percent reduction for political officeholders and a salary ceiling for senior public-sector officials of 130 percent of the Prime Minister’s salary.
Curaçao was also required to accept a broad reform package covering government, the economy, healthcare, education and the rule of law.
None of those requirements is newly revealed by the WOO documents. What the documents add is a more detailed picture of the sequence followed by the Netherlands: Curaçao had to accept the conditions and sign the reform package before the next portions of urgently needed liquidity became accessible.
The country package therefore functioned not only as a long-term reform program but also as a gateway to immediate financial assistance at a moment when Curaçao’s public finances had been severely affected by the pandemic.
By the end of 2020, the third tranche consisted of XCG 105 million followed by another XCG 181 million.
Together, the newly released documents show just how closely Curaçao’s immediate financial survival during the pandemic and its acceptance of the Dutch-backed reform program had become intertwined.