Government supports islands with investment programme for economy and energy transition
The Netherlands will make investment programmes available to the Constituent Countries – Curaçao, Aruba and Sint Maarten – and the Caribbean Netherlands – Bonaire, Saba and Sint Eustatius. The investments are intended to enhance the economic growth potential of the six islands, to increase their financial and economic independence, to accelerate the energy transition and to increase their standard of living and employment opportunities. This funding fulfils one of the pledges the government made in the coalition agreement.
Investment programme for Curaçao, Aruba and Sint Maarten
The Netherlands has reserved a maximum of €200 million from the National Growth Fund (NGF) to assist the economic development of Curaçao, Aruba and Sint Maarten. To be eligible for these funds, the Constituent Countries can submit projects that will demonstrably have a major impact on their long-term earning potential. The funding is conditional on high-quality project proposals related to climate adaptation and the energy transition, education, digitalisation of government, basic infrastructure (logistical infrastructure, water purification and waste processing), cost-efficient food production and increasing the sustainability of the economy (particularly the tourism sector). An initial tranche of €100 million will be made available. If many high-quality proposals that comply with yet-to-be-determined guarantees and criteria are submitted and this total is exceeded, a second tranche of a maximum of €100 million is possible. The investment program will be worked out in the coming months after consulting the Constituent Countries.
Energy transition and guarantee scheme
To promote the energy transition in Curaçao, Aruba and Sint Maarten, Sustainable Energy Generation and Climate Transition Incentive (Stimulering Duurzame Energieproductie en Klimaattransitie, SDE) funds can be reserved for investment in a single (or several) cost-effective projects. These projects must make a substantial contribution to the energy transition in the Constituent Countries. TNO will begin a study this summer to assess the extent to which projects that promote sustainable energy generation and/or CO2 reduction are possible. These may include projects to increase solar and wind energy generation capacity, so that a large part of the energy consumed on the islands is sustainably generated and the energy costs of businesses and consumers decrease. This will also make the production and export of hydrogen more attractive.
Finally, the government is developing a customized guarantee scheme to encourage lending to financially sound companies in Curaçao, Aruba and Sint Maarten. A guarantee scheme helps businesses with little collateral to obtain funding. It is expected that no such scheme is currently available in Curaçao, Aruba and Sint Maarten. In contrast to the situation in the Netherlands, the guarantee scheme will also be open to companies in sectors such as agriculture and fisheries. This is necessary as the islands are still very dependent on imports of fresh fruit and vegetables.
As the Caribbean Netherlands, Bonaire, Saba and Sint Eustatius are already eligible for resources from the National Growth Fund, the SDE scheme and a guarantee scheme. Special measures will be developed to make it easier for these islands to access the subsidy schemes and guarantee scheme.
To this end, the government will make €30 million available from the NGF to the Caribbean Netherlands and is developing a separate programme to enhance the long-term earning potential of the Caribbean Netherlands. Because Bonaire, Sint Eustatius and Saba have structurally vulnerable economies that are heavily dependent on tourism and imports, as do the Constituent Countries, the areas covered by this investment programme in the Caribbean Netherlands will be similar to those for Curaçao, Aruba and Sint Maarten.
In September last year, €33.6 million was made available to the Caribbean Netherlands from the SDE funds and the Regional Package (Regio Enveloppe). These resources are already being used to fund customized green energy generation projects, including the construction of a new solar farm in Bonaire with more than 10,000 solar panels capable of supplying 5000 homes.
Companies in the Caribbean Netherlands currently make little use of the SME Credit Guarantee (Borgstelling MKB-kredieten, BMKB) scheme, even though the scheme has been adapted to the local context and demand. This guarantee scheme will be brought to the attention of companies, banks and other financiers in partnership with the Public Body (Openbaar Lichaam). The objective is to increase lending to local businesses to allow them to invest more.
During the coming months, the three programmes for Curaçao, Aruba and Sint Maarten will be developed further and more work will be done to develop specific measures for the Caribbean Netherlands. Consultations with the Constituent Countries and the Caribbean Netherlands will start before the summer to discuss the detailed frameworks for the three instruments and to determine how the Constituent Countries and the Caribbean Netherlands can be supported effectively during the development and implementation of projects.
Originally published at https://www.government.nl/latest/news/2023/05/16/government-supports-islands-with-investment-programme-for-economy-and-energy-transition