GOVERNOR'S ADDRESS OPENING OF THE PARLIAMENTARY YEAR SEPTEMBER 9, 2014

THE GOVERNOR'S ADDRESS
DELIVERED BY HIS EXCELLENCY GOVERNOR EUGENE B. HOLIDAY
ON THE OCCASION OF THE
OPENING OF THE PARLIAMENTARY YEAR
TUESDAY, SEPTEMBER 9, 2014

Madam Chairlady, Members of Parliament,
Congratulations with the opening of this parliamentary year.
Today we are gathered here on the occasion of the fifth opening of a new parliamentary year since October 10th, 2010. As prescribed in our constitution this annual recurring event, held on the second Tuesday of September, marks the beginning of a new political year where I, in my capacity as Governor of Sint Maarten, present you and the people of Sint Maarten with an outline of the policy plans of the government for the coming year.
The opening of this parliamentary year is however different from previous ones; different because it comes at a time of transition. Transition because today's opening of Parliament follows the August 29th elections. As a result the composition of Parliament will change with the swearing in of new members of Parliament in just over a month from now; while a new council of ministers will be formed and installed based on a majority in the new Parliament thereafter. This means that pending the installation of the new council of ministers the governance of our country is in a transitionary phase, with the current ministers functioning as caretakers. In this caretaker capacity I have requested the current ministers to continue to manage the interest of the people by addressing the day to day operations of the country.
Madam Chairlady, Members of Parliament,
In view of this transitional reality the emphasis of this address will not be on the policy agenda but rather on the policy challenges and opportunities for the upcoming year.
I shall as a result in the next few minutes, within the context of the prevailing domestic and socio-economic setting and the global economic climate, reflect on local developments. That as the basis for presenting the policy challenges and opportunities for the period ahead. In doing so I hope, on behalf of government, to project on what the new parliamentarians and government can expect to face in the coming year.
Madam Chairlady, Members of Parliament,
As you know, developments in Sint Maarten, given our open and tourist based economy, are heavily dependent on global economic developments. As a result of an improving global outlook there are real opportunities for economic growth in the period ahead. Initial indications show that a pick-up in tourism can already be seen in the figures. According to recent projections of the IMF and the Ministry of Tourism and Economic Affairs, our economy is expected to grow by about 2% this year. Moreover, we have a healthy debt-to-GDP ratio, of approximately 30%.

Madam Chairlady, Members of Parliament,
Economic growth has however not resulted in greater fiscal space nor resolved all the prevailing socio economic issues.
It is therefore essential that issues such as unemployment, poverty, increasing health care costs and increasing shortage in affordable housing continue to receive the necessary attention. Likewise it is critical to note, that while our population is still comparatively young, our people are living longer and as a result steadily ageing. These issues form critical policy challenges. Addressing them are important to ensure a balanced and sustainable development of our country. Taking that into account and considering that these issues are interconnected government has, among other things, drafted legislation to address these concerns. These include a draft ordinance to change legislation concerning civil contracts as well as proposed price indexation legislation, that will lead to an increase in social benefits. Both are expected to be presented to Parliament this year.
Moreover, government to curb potential poverty among the current and future generations of elderly has adopted a phased approach. Starting with the first phase government has decided to increase pension benefits and the pension age from 60 to 62. Legislation to that effect has already been presented to Parliament for approval. The second phase concerns researching the feasibility and design of a compulsory pension plan. Maintaining current social security provisions, health promotion activities and the quality of health care in light of annual budget cuts are other issues the new government and parliament will face. This government has noticed that investing in strategic international and Caribbean alliances has resulted in financial resources and technical assistance from agencies and organization, such as: the International Labor Organization (ILO), the World Health Organization (WHO), the Pan American Health Organization (PAHO), and the European Union (EU). Furthering and building these alliances is expected to open opportunities for the future.
Madam Chairlady, Members of Parliament,
Developing and offering education that gives people the right skills and knowledge to become productive participants in our society, is ultimately the most effective way to combat unemployment. The promotion of equal access to quality education, recreation, social and psychical development has therefore been a key objective of the current government. To that effect preparation of legislation on study financing and on higher education has been high on government's agenda and are in their final stage. In addition, steps to establish international and regional relations to promote education, sports, cultural and youth affairs look promising. In particular contacts have been made in the CARICOM region, with meetings held in St. Kitts and Anguilla as well as existing plans to meet with officials in Barbados. Government believes that fostering these ties and working in a close relationship with our French neighbors and the Netherlands, can play a major role in the realization of the potential of Sint Maarten's education system.
Madam Chairlady, Members of Parliament,
As government works at improving socio-economic conditions and opportunities it is essential to ensure the safety and security of our people. Ensuring the safety and security of our people continues to be a challenge. That in large part because of the limited fiscal space mentioned earlier. Finding a good balance between preventative measures - through education - and repressive measures will continue to demand attention in the period ahead.
In the face of budgetary constraints, government has nonetheless made progress in the renovation, modernization and creation of a number of detention facilities. That while at the same time seeking to address the ongoing challenge to expand the manpower necessary to ensure that these facilities, as well as the police force and the public prosecutor's office can function properly. In the meantime new legislation have been prepared, including (1) a new law creating a small claims court, (2) a change of the law to implement a tourist driver´s license and (3) a new code for penal procedures, for further handling this year. While the safety and security challenges are complex, opportunities can be found in the form of the Justice Academy in terms of capacity building, as well as in the form of international and cross-border cooperation with the French authorities to better combat and disrupt criminal operations.
Madam Chairlady, members of Parliament,
From a broader perspective the government wishes to emphasize that maintaining good foreign relations has been a priority for past governments and should undoubtedly remain a key factor in future governance. This because maintaining good foreign relations and strong international bonds in the region and internationally helps Sint Maarten to build capacity and grow economically. Continuation of close cooperation with French St. Martin and the United States of America are key in that regard. Moreover our relationship with Barbados and the Dominican Republic have been strengthened.
Madam Chairlady, Members of Parliament,
To address existing and future socio economic challenges aimed at meeting the needs of our people, government has been working at strengthening the public administration by implementing changes in its economic and financial governance infrastructure.
As I stated earlier, tourism - which accounts for some 71% of our exports - is the main pillar of our economy. As a result government has worked to create the Sint Maarten Tourism Authority to contribute to the further and sustainable development of our tourism industry. Likewise government has taken steps to introduce an intellectual property bureau. The ordinance in which the tasks and responsibilities of the intellectual property bureau are laid down has been presented to Parliament. Other important policy challenges in the period ahead include: the development of the competition & consumer protection authority as well as an agency responsible for licensing and control over all gaming operations on the island and a review of the tariff systems.
Madam Chairlady, members of Parliament,
While government believes that addressing these and other policy challenges will help to further strengthen the economic governance of our country, it is aware that that is not enough.
It has therefor been the policy of the current government to work towards the strengthening of the public administration through institutional and capacity building. An important aspect in regard to the public administration is the ongoing debate regarding integrity and the promotion of integrity as a means to ensure good governance. Considering the work carried out under the government's integrity program during the past years and given the number of integrity inquiries conducted it will be up to the new government, supported by Parliament, to address this critical concern.

Madam Chairlady, members of Parliament,
Addressing mentioned policy challenges through the execution of existing plans and/or the development and implementation of new policy plans will come at a cost, costs which will have to be managed efficiently and effectively. This in view of the limited fiscal space mentioned earlier.
Addressing the limited available fiscal space coupled with the concerns of tax collection and non-compliance have had the attention of the current government and are expected to continue to be important policy challenges for the coming period. The development and introduction of tax reform measures should therefore remain high on the policy agenda. In doing so, it is essential to make use of the opportunity to strengthen the function of taxation as a source of revenue and at the same time implement tax reforms that favor the poor on our island. By doing the latter taxation can also be a useful development tool.
Over the past year, government has worked to reduce the backlog in financial reporting and to properly manage information, by instituting monthly reporting per Ministry. These steps provide the basis and tools to better manage income, control spending and give account for the activities of government. In that regard it is important to note that progress has been made in the preparation of the 2012 financial statement and the draft budget of 2015 for presentation to Parliament. The 2011 financial statement and the ordinance to amend the 2014 budget have already been presented to Parliament for consideration.
Madame Chairlady, Members of Parliament,
The Government, through the outlined overview of legislation placed before Parliament and through the identified policy challenges and opportunities, hopes to contribute to the debate on future policy plans of the new government aimed at continuing to create opportunities for all residents of Sint Maarten based on a sound national, social and economic foundation.
It is in that light that the government hereby thanks you as members of Parliament for your support and cooperation towards the achievement of its agenda during the past 13 months.
Madam Chairlady, Members of Parliament
In closing, I hereby take this opportunity in view of this transitionary period to thank you as siting parliamentarians as well as the former parliamentarians for yours and their service during the past 4 years.
Thank you, God bless you and god bless our beloved Sint Maarten.

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