THE HAGUE - Due to the fragile state of Curaçao's public finances and the country's high debt ratio, there is a real risk that the liquidity loans of the Netherlands cannot be repaid on October 10, 2023. That is what State Secretary for Kingdom Relations Alexandra van Huffelen wrote to the Second Chamber of the Dutch Parliament.
This concerns a total amount of 911 million guilders (just over 448 million euros). The loans actually had to be repaid next week, but in consultation between the two countries it has been decided on a short-term refinancing of eighteen months.
The effects of the covid-19 pandemic on Curaçao are still considerable and although developments are slowly moving in the right direction, Curaçao's financial and economic capacity for interest and repayment obligations is still insufficient.
Tranches
The refinancing relates to the five tranches of liquidity support provided by the Netherlands to Curaçao.
Talks about long-term refinancing and repayment from October 10, 2023 will be started in time, the State Secretary writes. This will include Curaçao's repayment capacity and debt quota.
The debt ratio of Curaçao is expected to rise to 100.2% of the Gross Domestic Product, partly due to the Covid-19 pandemic.
The aim is to reach long-term sustainable agreements.