Serge Mansur

CBA Report 1^st Quarter 2007

The ATIA remains very concerned about the ever growing deficit of our Government. According the Central Bank’s latest Quarterly Report (1^st Quarter of 2007), our government’s debt recently surpassed Awg.2,000,000,000.00.

This fact in itself gives much cause for concern. What is even more worrisome, however, is that the financial deficit grew compared to the corresponding quarter in 2006. This is the same quarter in which BBO was introduced.

The ATIA has said many times in the past that we do not believe that the Government’s problem is due a lack of income, but rather excessive spending. As long as our elected officials insist on spending too much of our community’s money, our financial problems will not be solved. We must recognize that we live in a small country and that we have limitations. This small community can not afford the enormous government apparatus that has been created by our elected officials.

Fitch Report

The latest Fitch Report (released Thursday, August 30) announced that Aruba’s BBB Rating has been affirmed. The main reasons for this are:

“Aruba’s ratings are supported by its relatively high per capita income of over US$20,000, which is well above the ‘BBB’ median of US$5,350, its market-friendly institutional environment, based on a well-functioning legal system, rule of law and legally protected rights, and its continued political and social stability. Aruba’s external solvency ratios such as net external debt and net public sector external debt (as a percentage of current external receipts) are also consistent with the ‘BBB’ median.”

“Additionally, the rating incorporates the fact that Aruba is part of the Kingdom of the Netherlands (’AAA’). Although Aruba gained status aparte in 1986, its strong links with the Dutch government and the implicit support for the island are unique. Aruba’s rating weaknesses comprise structural weaknesses in its public finances including a high level of budgetary rigidity and continued reliance on arrears to suppliers and the broader public sector as a source of financing, its relatively high public debt burden (47% of GDP) and its relatively low international liquidity in the context of its narrow economy.”

From this press release we can surmise that our relatively high rating is thanks to our private sector and our ties to the Netherlands, while our weakness is basically the excessive spending of our public sector.

The full press release can be found on ATIA’s website: www.atiaruba.org.

Long-lease (Erfpacht)

Recently the Chamber of Commerce brought forward their opinion regarding the Government’s habit of leasing out valuable plots of land for a pittance to corporations that can afford to pay a fair price for the property they need to conduct their business.

The ATIA is in full agreement with the Chamber on this issue. While we recognize that this practice had its benefits in the past, we feel that its time has passed. In this day and age it is not responsible for a Government to basically give away large plots of land worth millions to wealthy individuals and/or companies.

We do agree that “erfpacht” should still be given out to individuals wishing to build a home for their family. We can even agree with this practice as an incentive for investment (for example to attract business to San Nicolas, or to help revitalize an area going through hardship), but to give away prime real estate in economically vibrant areas seems to be contrary to the best interests of our community.

Political Nominations.

For weeks already rumors are circulating about certain members of Parliament jockeying for well-paid positions in Government or Government-controlled organizations. We have heard such rumors relating to foreign posts, Government-owned N.V.’s and even foundations with important social functions in our community.

We have not gotten any confirmation about these matters, but we do wish to take this opportunity to bring forth that we sincerely hope that these rumors are patently false, and that no such abuse will take place.

If there are any open positions, these should be filled by qualified people selected in a transparent process, and not by political cronies.