Friday, May 29th

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Editorial - Reasonably bright

Media often are accused of bringing mostly bad news, simply because when things go well there is nothing wrong to report on. While there may be some truth to that, the Central Bank’s announcement that the gross domestic product (GDP) of St. Maarten grew by 1.6 per cent in the first quarter (see related story) merits a positive mention.

That is all the more the case when one considers that monetary union partner Curaçao saw a decline of 0.2 per cent. The latter might again raise questions about the current arrangement with a shared currency, but for now the two countries have huge common interests.

One of these is obviously to keep the joint balance of payments healthy, so that the foreign exchange reserves stay at a responsible level and the Antillean guilder’s value, including its fixed exchange rate “peg” to the US dollar, is not endangered. To do that, real earnings from the export of goods and services must match expenditures on imports or any deficit in that sense at least should be reduced, which is exactly what has happened.

In fact, the economic development picture is not that negative certainly in St. Maarten’s case. Both consumption and investment were up, indicating a continuing positive trend.

To stay on track it’s important that the local hospitality industry keeps performing, while several pending projects need to be realised. This will create employment and attract new business, both of which are very welcome at the moment.

So when people say things are going very badly on the Dutch side, they may be speaking from personal experience rather than giving an objective assessment of the general situation. Of course, there are pressing social problems and other issues affecting many individuals, but to act as though St. Maarten is slipping down a slope into some sort of abyss seems a bit exaggerated.

The private sector remains in decent shape, while Government is where most of the uncertainties and difficulties are to be found. It may take a while, but if the public finances, including fiscal compliance, can be straightened out once and for all, the future actually looks reasonably bright.