PHILIPSBURG–St. Maarten is facing a US $1 billion funding gap on its road to recovery from the devastation of Hurricane Irma, one of the worst storms in recorded history, which slammed into the country some ten months ago. Government still has to work out how it will fill this hole.
The “common task” of Parliament and government is “to find additional funding to narrow this gap” left after the World Bank-administrated Dutch Recovery Trust Fund of $580 million and insurance pay-outs are applied, Prime Minister Leona Romeo-Marlin told Members of Parliament (MPs) in the Central Committee sitting on Thursday afternoon as she presented the National Recovery and Resilience Plan (NRRP).
“Together, the Trust Fund and insurance pay-outs will cover, in the best-case scenario, about 50 per cent of the identified needs in the NRRP. This leaves a major funding gap of at least $1 billion,” the prime minister said.
The funding to bridge the gap could partly come from the country’s budget by reducing cost and increasing revenues. Other important sources of funding can come from public-private initiatives and additional support from the Dutch Kingdom and the international community, she suggested.
Government and the World Bank estimate total damage and losses from Hurricanes Irma and Maria at $2.7 billion. The National Recovery and Resilience Plan (NRRP) estimates that about $2.3 billion will be required for recovery and resilience interventions over the next seven years, if St. Maarten is not confronted with another major hurricane.
Government “does not have all the necessary funding to finance the whole NRRP,” said the prime minister. “There is a significant gap between the $2.3 billion in the NRRP and the currently available funding.”
Government has ensured that $580 million via the trust fund will become available to St. Maarten in the coming years. “This will be our biggest source of funding – which we can only access by following World Bank procedures. I acknowledge that these procedures do take some time and can be frustrating, but is necessary in order to obtain the funds,” she said.
Aside from the trust fund, government’s second major source of funding for now will be insurance payments for its properties. Insurance is estimated between $320 million and $430 million.
Government, she noted, cannot spend money that it does not have. This makes clear that we need to find more money, but also that we need to prioritise. “
The plan
The NRRP, described by the prime minister as a “thorough and knowledge-based document,” has as its foundation pillars tackling the basic needs of the St. Maarten people, preparing the country as much as possible for the peak of the hurricane season, and kick-starting the economy. The plan was prepared by more than 170 national and international experts.
“We need to strengthen our infrastructure, our economy and our institutions – not just to recover, but to avoid a repeat of the devastation brought by Hurricane Irma. The NRRP tells us what we need to do, as a country, to build back better. This is the roadmap for our ongoing recovery process – a process that began the day of the storm and will require our undivided attention for years to come,” according to the prime minister.
The expected outcomes from the NRRP are sustainable recovery of social sectors in affected communities, restoration of businesses’ continuity combined with a strategy for diversifying business activity, rehabilitation and reconstruction of critical infrastructure to Build-Back-Better (BBB) standards, and strengthening the country’s readiness to mitigate, respond to and recover from the future impacts of natural disasters and climate change.
Needs
According to the NRRP’s executive summary, the wellbeing of the people ultimately depends on a sustainable and flourishing economy that supports broad employment possibilities. Therefore, recommended interventions include re-establishing business activity through conditional financing for sustainable recovery of the tourism industry, revitalising the main commercial districts, and increasing credit for small- and medium-size enterprises.
The plan calls for repairing and reconstructing critical infrastructure to BBB standards, including the airport, seaport, marina facilities and hotels; strengthening vital utility networks (electricity, water supply, and telecommunications); and improving drainage to reduce flooding risk.
The NRRP focuses on strengthening key areas of governance to better prepare for future disasters, including disaster risk management and response via repairing and reconstructing first responder facilities and replacing vehicles and equipment, improving existing early warning systems and emergency communications systems, and coordination among fire, police, and emergency agencies, exploring options for disaster risk financing.
In the area of financial management capacity, the plan recommends strengthening public financial management capacity and modernising the tax system to improve compliance and collection.
Repairing or reconstructing key police stations and prison, building a new 911 call centre, and strengthening the information and communication technology (ICT) and emergency communications network are listed under upgrading justice, public safety and security.
To ensure community recovery and resilience, repairing damaged houses through a large-scale roof repair programme, increased support for social and affordable housing, reviewing current building codes in the spirit of building back better, exploring opportunities to upgrade informal settlements to improve disaster resilience, and establishing a mortgage guarantee fund to encourage home ownership are listed as priorities.
Improvement of the quality and availability of health and mental health services by supporting the construction of a new hospital, strengthening emergency services, enhancing prevention activities to address potential post-hurricane health impacts (including psychosocial care), increasing the capacity of secondary healthcare services, and ensuring continuity of health insurance are addressed by the plan.
In the area of education, the plan calls for repairing and rebuilding damaged schools to more resilient standards, implementing a school-feeding programme, strengthening after-school programmes for vulnerable children, providing psychosocial care to affected students and staff, and promoting labour market entry through a sustainable education system with emphasis on vocational and tertiary training.
Government via the plan has to seek ways to provide social assistance to address immediate survival needs, such as income support and employment training; ensuring access to healthcare through a streamlined community-based approach; repairing damaged emergency shelters and building new ones; and establishing an unemployment insurance fund as a contingency instrument to cope with future disasters.
Removing hurricane debris, ending dump fires, building a sustainable solution to solid waste, establishing a robust recycling programme and expanding the sewage treatment network are projects to be derived from the plan, subtitled “A roadmap to building back better.”
The prime minister presented the plan to Parliament to get the legislature’s seal of approval. No MPs raised any issue related to the plan’s contents in Thursday’s sitting. The plan will now go to a plenary sitting of Parliament for formal approval.
Tying into the plan is the pending approval by Parliament of the draft temporary ordinance to establish the National Recovery Programme Bureau.
Source: The Daily Herald https://www.thedailyherald.sx/islands/77871-govt-facing-us-1-billion-gap-in-recovery-funding
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