Economic Developments Centrale Bank van Curaçao en Sint Maarten

Transcription

1 Economic Developments Centrale Bank van Curaçao en Sint Maarten December 20, 2016

2 Contents: I. Economic Developments Real Sector Public Sector External Sector II. Monetary Developments III. Economic Outlook 2

3 Economic Developments Real Sector 3

4 Developments in the monetary union Current account balance (in mln NAf.) Change in gross foreign reserves of the central bank (in mln NAf.)* Change private loans (%)** Curaçao Sint Maarten Real GDP growth (%) Curaçao Sint Maarten Inflation (%) Curaçao Sint Maarten *- sign means an increase ** Annualized per June 2016

5 Economic Development Curaçao I. Real output growth in Curaçao is expected to remain flat in II. Inflationary pressures are expected to remain negative at -0.4%, mainly because of lower 4% 3% 2% 1% 0% -1% -2% international oil prices. 5 *Projection CBCS 0.3% 0.0% -0.5% -0.4% * Real GDP Inflation

6 Sectoral performance Curaçao in 2016 I. Decline in restaurants & hotels sector: Decrease in visitor nights. Slower growth in stay-over tourism. Decrease in cruise tourism. II. Decline in manufacturing sector: Decrease in refining and trading activities by the Isla refinery. III. Decline in wholesale & retail trade sector: Decrease in tourism spending and free zone activities. IV. Decline in transport, storage, & communication sector: Decrease in air and sea transport. 6

7 Sectoral performance Curaçao in 2016 (cont.) V. Growth in construction sector: Increase in private and public investments. VI. Growth in financial sector: Increase in domestic financial services. Decrease in international financial services. VII. Growth in utilities sector: Increase in water and electricity production. 7

8 Economic Developments Public Sector 8

9 9 Main developments Curaçao I. The government of Curaçao expects a budget surplus of NAf.5.5 million in 2016, an improvement compared to the deficit of NAf.1.6 million recorded in II. Due to an amendment of Article 4, section 1 of the Budget Act, all expenses and income related to the social security bank, SVB, are included in the government s budget as of III. January The government issued a NAf.59.0 million bond in June to finance several investment projects, such as the renovation of school buildings and the automation of tax collection.

10 NAf. mln Budget development Curaçao 3,000 2,500 2, , , * -50 Budget balance (r.h.s.) Total expenditures Total revenues *Projection CBCS 10

11 NAf mln Public debt and GDP: Curaçao 6,000 5,644 5,621 50% 5,000 44% 46% 45% 4,000 3,000 40% 2,496 2,564 40% 35% 2,000 30% 1,000 25% * 20% Total public debt GDP Debt-to-GDP ratio (r.h.s.) *Projection CBCS 11

12 Economic Developments External Sector 12

13 Main developments I. Current account deficit widened. II. Increase in external financing. III. As foreign financing was more than sufficient to cover current account deficit, gross official reserves rose

14 Balance of payments (transaction basis, NAf. mln) * Current account - 1, Capital account External financing , Change in reserves *Projection CBCS 14

15 Balance of payments developments (in % of GDP) 30% 20% 10% 0% -10% -20% -30% 9.8% 13.2% -10.6% -12.3% * 15 Current account balance External financing of the private sector *Projection CBCS

16 NAf. mln Tourism sector 2,000 1,600 1,675 1,630 1,200 1,090 1, * Curacao Sint Maarten *Projection CBCS 16

17 NAf. mln International financial sector * 17 Net operational income Profit tax BRK windfall *Projection CBCS

18 NAf. mln Refining fee (Curaçao) * *Projection CBCS 18

19 Months Monthly import coverage Import coverage norm Import coverage corrected for standing subscription Import coverage estimate Import coverage

20 Monetary Developments 20

21 16% Private credit extension (annual growth) 12% 8% 4% 0% -4% -8% Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Loans to the private sector Loans to the private sector Sint Maarten Loans to the private sector Curaçao 21

22 Monetary policy stance I. During the first quarter of 2016, monetary policy aimed at reducing the liquidity on the money market: Auctioning of more Certificates of Deposit. Reserve requirement was kept unchanged at 18.00%. II. Since the second quarter of 2016, the monetary policy instruments were deployed neutrally. 22

23 Economic Outlook 23

24 Expected developments in the monetary union in 2017 Current account balance (in mln NAf.) Change in gross foreign reserves of the central bank (in mln NAf.)* ** Real GDP growth (%) Curaçao Sint Maarten Inflation (%) Curaçao Sint Maarten *- sign means an increase ** projection CBCS. 24

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