BBB Gets Mail from the Sidelines

The IMF, Dutch, and the government’s own working groups proposed several measures that were supposed to create a more resilient, diversified, green, and competitive economy and a modern, streamlined, e-government that supports businesses and provides services efficiently.

Instead, the island is back in the same situation as before the crisis. Mass tourism that is practically the only economic activity, bloated and inefficient public administration, fossil fuel-based electricity sector, slowly but surely eroding natural endowment, budget deficits, etc.

There is not much point arguing about 5% of the salary of public employees. At least 20% of the employees need to let go, so the remaining ones can be better paid and motivated. Those who leave should join the private sector so they can produce economic value.

A 20% reduction sounds radical, but it only requires political will. If Aruba wants to preserve its autonomy, some symbols should be sacrificed so what really matters — balanced and sustainable budgets — can be restored.

Why does an island with a population of a small town need its own central bank and currency? Dollarization (which was recommended even by the Dutch) would not only make the central bank superfluous, but create a better business environment. The current capital movement and exchange controls can be abolished, making Aruba a more attractive destination for foreign direct investment.

E-government has been proven to be a successful method to improve public administration in many countries, some much less developed than Aruba. Instead of its current snail-pace introduction, a rapid program can put a stop to the incredibly inefficient person-to-person administration, with a waste of everybody’s time, uninformed citizens, and slow-moving pieces of papers.

One could go on. However, none of the above is new. A flurry of thinking and consultation generated a strategy that only needs implementation. Sadly, almost none of the proposals are being acted on, and GOA has fallen back to the old way of doing things. Which mostly means paralysis and waiting for miracles (for example, a refurbished refinery) and money from the Dutch.


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July 22, 2022
Rona Coster