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Harbour taken to court over ‘breach of contract’

page3c080POINTE BLANCHE--Zebec Development N.V. filed a legal claim for more than US $100 million against the St. Maarten Harbour Group of Companies and its Chief Executive Officer (CEO) Mark Mingo yesterday, August 20, for alleged breach of contract concerning the development of the Harbour Village project in the cruise terminal.

"The claim stems from the Harbour's repeated failure to meet its contractual obligations as defined under various agreements," Zebec said. It said it was to fully fund and develop the project, while the Harbour Group simply would generate "many years of income from a revenue-sharing agreement."

"Agreements with the Harbour have been entered into over the last four years with CEO Mark Mingo, who continues to set up roadblocks to this mutually beneficial new development. Despite an enormous commitment of time and the expenditure of several million dollars in research and development, Zebec is no closer to seeing this project become a reality," explained Zebec Managing Director Tony Cabeceira in a press release issued on Wednesday.

The company said it was left with no alternative other than to commence legal action after "long-term efforts to reach a satisfactory amicable solution with its development partners" had failed. "While we regret having to resort to this measure, we feel we have no alternative but to seek remedies in the Court," said Zebec Managing Director Luis Gioia.

The Harbour Village was intended to be a collaborative effort to develop the currently vacant 13,000-square-metre parcel of land adjacent to the cruise piers into "an unrivalled mix of shopping and entertainment" that would include, among other things, restaurants, bars and a lazy-pool. Zebec said it had a long-lease on the land.

The Harbour previously had promoted the project through brochures and the local newspapers.

"Designed and inspired by a former Disney World creative team and featuring a variety of entertainment experiences, the Harbour Village was destined to make St. Maarten Harbour the flagship port of call in the entire Caribbean," said Cabeceira.

It "would provide economic benefits well beyond the long-term financial rewards for the Harbour. By creating an unparalleled tourist experience, the Dutch Harbour Village would help increase cruise passenger expenditures in St Maarten and provide both much-needed employment opportunities and a new source of tax revenue for the country."

Lexwell Attorneys at Law associate Willem Nelissen declined to give further specifics on the new case, but confirmed that it had been filed and that although the cooperation had been announced publicly, it now had simmered down to a complete standstill.

CEO Mingo could not be reached for comment on Wednesday.

Economy expanded by 0.9 per cent in 2013

~ Public sector contribution negative ~

PHILIPSBURG--St. Maarten's economy expanded in real terms by 0.9 per cent in 2013, Central Bank of Curaçao and St. Maarten President Dr. Emsley Tromp said during a presentation of the institution's 2013 Annual Report on Tuesday.

The real gross domestic product (GDP) growth was driven solely by the private sector. The contribution of the public sector was negative.

While St. Maarten recorded a small expansion, the real GDP in Curaçao contracted by 0.8 per cent. Tromp said the economic performance in the monetary union of Curaçao and St. Maarten had been "mixed" in 2013.

He said in St Maarten inflation had moderated from 4.0 per cent in 2012 to 2.5 per cent in 2013 because of a slowdown in food price gains and lower electricity prices, while consumer price inflation in Curaçao dropped to 1.3 per cent in 2013 from 3.2 per cent in 2012 reflecting mainly lower fuel prices.

St. Maarten

According to Tromp, private sector growth was supported primarily by the wholesale and retail trade and construction sectors. The positive development in the wholesale and retail trade sector was the result of increased domestic demand and more tourism spending, he said. Real value added rose in the construction sector due to more public and private sector investments.

Growth weakened in the restaurants and hotels sector in 2013 as the expansion in both stay-over and cruise tourism was less pronounced than in 2012. The expansion in stay-over tourism was driven by increases in the number of visitors from South America, North America and the Caribbean. However, the North American and Caribbean market segments rose at a slower pace than in 2012.

The European market segment contracted, due mainly to fewer visitors from the Netherlands and France, said Tromp. The development in cruise tourism matches the increase in the number of cruise vessels visiting the port of Philipsburg during 2013.

Following a contraction in 2012, activities in the manufacturing sector rose in 2013 because of increased repair activities on yachts that visited St. Maarten. The utilities sector also contributed positively to growth, as reflected by increases in the production and consumption of water and electricity.

Poor performance of the transport, storage and communication and financial intermediation sectors dampened St Maarten's real GDP growth in 2013. Real output dropped in the financial intermediation sector, as indicated by a decline in net interest income of the domestic banks.

Meanwhile, real value added in the transport, storage and communication sector shrank due to a decline in harbour activities mitigated by more air transportation and airport-related activities. The poor performance by the harbour was the result of a drop in the number of ships that visited St Maarten.

Curaçao

The economic contraction in Curaçao was attributable entirely to domestic spending. By contrast, net foreign demand increased. The private sector in particular accounted for the decline in domestic spending. Both private consumption and investment fell.

The drop in private consumption was related to the measures taken by the government, including the increase in social premiums that affected disposable income, the worsening labour market conditions and the decline in consumer credit.

The contraction in government was entirely of a consumptive nature, as investments grew. The growth in public investment was driven mainly by the improvement of Curaçao's road infrastructure. The increase in net foreign demand was the result of imports dropping at a faster rate than exports.

Tromp said both Curaçao and St Maarten needed to address the rigidities in the labour market and reduce the cost of doing business. Because of the implementation of the debt relief programme, among other things, the money market of the monetary union has been characterised by high liquidity for some years.

"Therefore, the weak development in private investments in both countries is not due to a lack of capital, but to a lack of investor confidence affected by political instability, policy inconsistencies, and uncertainties in both Curaçao and St Maarten," he said. "Both governments need to focus on restoring investor confidence to achieve gains in private sector investments and, hence, a higher and sustainable growth path.

"The lacklustre growth performance of the islands during the last few years is not sufficient to bring the high unemployment to a socially acceptable level and to create the necessary fiscal room to address other social needs. To bring us to a higher growth path, a reform agenda has to be adopted and implemented, including educational, labour market and business climate reforms.

"This means that rather than being distracted by issues that run counter to these objectives, policymakers should direct their attention at promoting growth through appropriately designed growth policies," he said.

Growth cannot be achieved it the current monopolistic structure in key sectors of the economy are not addressed.

Also at the presentation were Central Bank of Curaçao and St. Maarten staffers Linda Hassell and Dwayne President of the St. Maarten office, and Ersilia de Lannooy, Shelwyn Salesia, Alberio Romero, Gregory Damoen, Eric Matto and Nancy van der Wal of the head office in Curaçao.

NAf. 5.9M renovation of Central Bank building starts in a month

~ New building in the pipeline ~

PHILIPSBURG--A NAf. 5.9 million renovation of the Central Bank of Curaçao and St. Maarten building on W.J.A. Nisbeth Road is expected to start in four weeks in an effort to create space for the hiring of new staffers for St. Maarten.

Plans are also in the pipeline to construct a new Central Bank building at a separate location, which will serve as a full-fledged subsidiary of the main office in Curaçao, President Emsley Tromp told reporters at a press conference on Tuesday, in which the bank made a presentation of its 2013 Annual Report.

The Central Bank charter stipulates that the main office of the Central Bank of Curaçao and St. Maarten would be located in Curaçao. Tromp said a lot of work was being executed from Curaçao. More persons need to be hired for St. Maarten, but to bolster the staff, additional facilities are needed. The remodelling of the current location will not be sufficient to meet the needs of the country, but it will serve as a short-term solution. The renovation is expected to take between 14 and 16 months. The bidding process is still to take place.

The media was shown an artist impression of what the renovated facility will look like. However, a copy of the artist impression was not provided.

When asked why renovate the current building while a new one was in the pipeline, Tromp said, "If we have to wait for the completion of the new building, then we will not have the appropriate facilities to continue staffing this facility."

Tromp also said the second floor of the current building contains apartments as it was originally used as accommodation for workers who came from Curaçao to be able to stay in while in St. Maarten to work. As the bank is moving to bolster its local work force, office space is needed, Tromp said.

"We want our own people here and for that we don't need apartments, we need office space," he said. "If we continue with the old model where the staff in Curaçao will stay here and work, then there is no need to remodel. But we don't want to wait until we complete [the new building – Ed.] and in four to five years to start recruiting the people of St. Maarten. We need to start building the institution, and equipping and training the people of St. Maarten to run the Central Bank."

The new building will serve as the headquarters for St. Maarten and will be equipped will all the necessities to operate as a stand-alone facility. The design of the new building has started. A committee has been established to assess the most appropriate location for the new facility.

Tromp said a committee has been established to evaluate the various sites and make a decision on a location. Several sites are under consideration. Tromp did not have information available as to how many new staffers will be hired on hand, but said a complete presentation on the project will be prepared and the press will be updated on details as the project progresses.

Natorii Illidge receives outstanding award in US

page5b079PHILIPSBURG--Home-grown dancer and elementary school teacher Natorii Illidge was honoured with an Outstanding Student Award from the Broadway Dance Center (BDC) in New York City, United States, where she is pursuing dance studies.

Illidge's diligence in taking a variety of classes, having perfect attendance and choreographing successful pieces were among the factors leading to her receiving the award.

BDC Director of Educational Programming Bonnie Erickson said she was proud of how Illidge, the first student from St. Maarten to attend the institution, had been developing. "This lovely young lady just has such wonderful warmth; it's a joy just to be in her presence. We're so proud of how she's growing, and all her performances are always just spectacular," Erickson said of the local dancer.

Illidge, a former St. Dominic Primary School teacher, is currently studying dance at the institution. She is expected to finalise her studies soon and return to St. Maarten before the end of the year. Once back home, Illidge wants to have the opportunity to share her skills to help other youngsters hone and develop their dancing skills.

Illidge is enjoying her experience in New York City and is learning quite a lot in various dance techniques. She has also choreographed dances and performed at several places in the US.

Integrity Committee advises to set up Integrity Chamber

By Suzanne Koelega

PHILIPSBURG/THE HAGUE--Establish a permanent Integrity Chamber as a new High Council of State to advise the Government of St. Maarten, invited and uninvited, on the general progress of integrity of the entire public sector, including government-owned companies and the appointment of top civil servants.

That is one of the most important recommendations of the Public Administration Integrity Committee, the committee that was requested by the St. Maarten government in October last year to look at the proper functioning of government with regard to integrity.

The 81-page report titled "Doing the right things right" dates from July 12 this year, and was released unofficially to The Daily Herald on Tuesday. The committee consists of Jacob "Bob" Wit (chairperson), Rieke Samson-Geerlings (vice-chairperson), Ron van der Veer (secretary) and members Ronald Bandell, Jan Beaujon, Richard Gibson Sr., Dick van Putten.

The committee presented 40 recommendations on various aspects dealing with integrity, including Parliament, the Council of Ministers, the Justice sector, government-owned companies, the housing of government offices, corporate governance, the role of the public, the issuance of permits and human trafficking.

The new Integrity Chamber would play a big role in promoting and supervising integrity matters in Country St. Maarten. It should have the specific authority to advise on the appointment, suspension and dismissal of persons in the boards of directors of government-owned companies and top civil servants, and to investigate the process of public tenders.

The independent and authoritative Chamber would serve as an advisor and, if necessary, a strict watchdog. It should have the authority to carry out audits, publish its advices and establish a hotline for alleged integrity violations.

Its members would be appointed based on a proposal by the president of the Joint Court of Justice, the vice-president of the Advisory Council, the president of the General Audit Chamber and the Ombudsman.

A number of recommendations have to do with the Parliament of St. Maarten, an organ about which the committee is particularly concerned. "The legislature should have an exemplary function, but both the institution as well as the individual members are too often, and often with good reason, negatively projected in the news, and don't seem to realise that because of that, the authority of the public sector as a whole suffers," it is stated in the report's conclusions.

Side-jobs

One of the recommendations is to create a public register of paid and unpaid side-jobs of Members of Parliament (MPs) and the gifts that they receive, and to publish this on the Parliament's Website, just as in the case of the Dutch Parliament.

The full-time versus part-time functioning of MPs should be looked at again. If it is qualified as a full-time function, then certain side-jobs should be prohibited, according to the committee. If the job of an MP is deemed part-time, then the salary should be reduced accordingly. Conflict-of-interest situations should be taken into consideration.

MPs' financial positions should be recorded just before their appointment and shortly after their retirement, just as is being done in the case of members of the Council of Ministers. A public code of conduct for integrity issues should be made for Parliament.

The chairperson (prime minister) and the secretary of the Council of Ministers should supervise more strictly the possible conflicts of interest in the deliberation and decision-making in the Council.

Screening

Legislation regarding the screening of ministers and the registration of their financial positions at the start and end of their terms should be revised, using the screening method of Country Curaçao and the Curaçao National Ordinance on Integrity of Ministers as an example.

Draft a manual for incoming St. Maarten ministers that includes integrity issues. Give more priority to human resources management issues in the public administration and include integrity issues.

Parliament should have a debate on the General Audit Chamber's baseline institutional care assessment 2014 and implement the recommendations of that report. Also, organise an annual debate in Parliament on the annual report of the Audit Chamber, and possibly the annual reports of the Advisory Council and the Ombudsman.

Make sure that the basic organisations of the ministries are put in order, using the expertise of the Audit Chamber, the Ombudsman and the Association of Dutch Municipalities VNG. Government should strive for a professional public organisation with clear definitions of tasks, authorities, responsibilities and mandates. There should be clear rules for the political Cabinets of ministers as well as their size, appointment and tasks.

Rented offices

The purchase and renting of government offices should be investigated with the help of financial experts in the area of real estate. According to the committee, citizens have the right to know exactly what happens with tax money when government rents or buys offices, and to know what price is being paid and from whom the property is rented or bought.

The National Detectives ("Landsrecherche") are in dire need of structural strengthening. The committee advises drafting a multi-annual cooperation programme with the countries of the Dutch Kingdom and other partners like the US and France. There should be special attention for financial fraud cases.

Make more use of the public to report alleged integrity violations. The importance of integrity and the combating of fraud and corruption should be promoted at schools through a specific public relations (PR) programme, with the participation of groups in the civil society.

All information relating to the issuance of permits should be published online and otherwise. It should become public knowledge who has requested and received certain permits, the criteria used and for how long these permits are valid.

Organise periodic investigations into the safety, corruption, vulnerability and integrity of the harbour and airport, especially where it concerns drugs and human trafficking, organised crime and the combating of terrorism.

Govt-owned companies

Government-owned companies should be obliged to provide information about their business operations on their Websites, including the publication of annual reports, annual accounts, business plans and the names and CVs of their management and board of directors.

Corporate governance experts should investigate to what extent the relations between government and government-owned companies should be revised to realise more transparency in these relations. Organise external, independent supervision on all public tenders of both government and its companies.

Directors of government-owned companies who are subjects of criminal investigation of serious integrity violations should resign until the investigation has been terminated. The new Integrity Chamber would give advice in these cases.

Existing legislation in the area of corporate governance should be revised, improved and strengthened. A corporate governance code should be implemented. The Corporate Governance Council should be terminated and its advisory role placed under the Integrity Chamber.

Plan of approach

The committee predicted that it will take a few years to institute the recommended Integrity Chamber, as the Constitution of Country St. Maarten will have to be adapted. In the meantime, a short-term plan of approach should be formulated to start with the execution of the committee's recommendations. A progress committee would monitor the subsequent steps.

The report also contained several recommendations to combat human-trafficking and the control of brothels and casinos. A National Human Trafficking Coordinator should be appointed and placed at the Prosecutor's Office. A critical evaluation of the Immigration Department should be carried out before 2015.

Brothel inspections should focus more on the combating of human trafficking. Equip the Tax Office so it can carry out more inspections in vulnerable sectors like casinos. The Gaming Control Board should be established within the short term.

The Daily Herald will be publishing more details of the integrity report in the coming days.

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