The bill is due: St. Maarten's ENNIA payments begin in 2027, budget sets aside Cg 3 million

GREAT BAY--St. Maarten is preparing to make its first direct annual contribution toward the long-term ENNIA resolution in 2027, with the Draft 2027 National Budget setting aside up to Cg 3 million for the payment.

The provision appears under the Ministry of Finance's Staff Bureau, within the budget category for projects and activities. The explanatory notes state that the Cg 3 million contribution to ENNIA was not applicable in 2026 but has been provided for in 2027.

The budget provision marks the beginning of what is expected to be a 30-year financial commitment by St. Maarten as part of the agreement reached with Curaçao and the Centrale Bank van Curaçao en Sint Maarten (CBCS) to resolve the financial problems surrounding ENNIA.

The ENNIA problems date back years. In July 2018, ENNIA Caribe Leven was placed under an emergency measure following intervention by the CBCS. The Central Bank subsequently worked with the governments of Curaçao and St. Maarten on a restructuring intended to protect policyholders and prevent the insurer's financial problems from resulting in significant reductions to pension and insurance rights.

A major breakthrough came on April 11, 2024, when St. Maarten, Curaçao and the CBCS signed the ENNIA Resolution Outline Agreement. An addendum containing further implementation agreements followed in October 2024. The restructuring led to changes in ENNIA's legal structure from January 1, 2025, including a partial restart of the insurance operations.

Background / St. Maarten's share begins in 2027

The financial commitment St. Maarten now faces is also significantly different from what was contained in the ENNIA arrangement inherited by Minister of Finance Marinka Gumbs. After taking office, Gumbs challenged several elements of the original Outline Agreement and pushed for an addendum that reduced St. Maarten’s exposure and more clearly limited the country’s responsibility to its own policyholders.

According to Government’s account presented to Parliament in September 2024, the revised terms were expected to save St. Maarten approximately Cg 37 million compared with the original arrangement. Among the changes, St. Maarten was removed from responsibility for costs associated with policyholders in Bonaire, St. Eustatius, Saba and Suriname, an estimated saving of approximately Cg 5 million. The country was also relieved of responsibility for operational expenses of the ENNIA Resolution Fund that would have cost an estimated Cg 15 million.

Gumbs also sought the separation of St. Maarten’s portion of the so-called peak facility from Curaçao’s, aimed at preventing St. Maarten from carrying financing costs associated with obligations that were not its own. Government estimated that the reduced use of that facility would save St. Maarten approximately Cg 3 million in interest expenses. A separate administration and annual audit reporting arrangement for St. Maarten’s portion of the Resolution Fund was also secured.

Another significant condition obtained during the negotiations was priority for St. Maarten in the event Mullet Bay is sold. Gumbs has since told Parliament that Government secured a right of first refusal over the property. Under the ENNIA arrangement, proceeds from an eventual Mullet Bay sale would flow toward the Resolution Fund, potentially reducing the contributions required from St. Maarten, Curaçao and the CBCS.

At the time, Gumbs made the Government’s position clear: St. Maarten was prepared to contribute toward protecting its own ENNIA policyholders, but should not be required to finance unrelated policyholders or operating expenses from which the country received no corresponding benefit. The revised arrangement narrowed St. Maarten’s exposure accordingly.

When Government announced the agreement in 2024, it said St. Maarten's share amounted to 6.49 percent, with an expected contribution of NAf 2.08 million annually for 30 years beginning in 2027, equivalent to approximately NAf 62.4 million over the full period. Curaçao was expected to contribute NAf 30 million annually.

CBCS has since described St. Maarten's contribution as approximately Cg 2.1 million per year for 30 years, beginning in 2027. The Central Bank itself is also contributing to the Resolution Fund through annual profit distributions of Cg 15 million, beginning in 2025 and continuing for 50 years.

The Draft 2027 Budget, however, takes a more cautious approach by making room for a maximum annual contribution of Cg 3 million.

According to the budget explanation, the final annual contribution is still subject to an actuarial calculation by the CBCS and further decision-making. The Cg 3 million therefore represents a budgetary ceiling rather than confirmation that St. Maarten's agreed contribution has increased from the previously announced Cg 2.08 million to Cg 3 million.

The Ministry of Finance's projects and activities budget increases from Cg 10.92 million in 2026 to Cg 16.466 million in 2027, with the ENNIA provision accounting for Cg 3 million of that category's spending increase. The same category also includes other projects, meaning the full increase cannot be attributed to ENNIA alone.

Why the resolution was necessary

The ENNIA resolution was developed because of a structural financial shortfall in the life insurance operation and the continuing obligation to make payments to policyholders.

Rather than allowing the financial problems to threaten those payments, the governments and CBCS agreed to establish and finance a Resolution Fund. The fund is intended to provide the financial support required as the older insurance portfolio is gradually managed down while the viable parts of ENNIA continue operating. CBCS has repeatedly stated that the resolution is designed to avoid reductions in policyholders' pension rights.

For St. Maarten, 2027 is therefore significant because the ENNIA arrangement moves from a future commitment into an actual national budget expense.

Barring changes to the agreement, ENNIA-related contributions are expected to remain part of St. Maarten's government finances for decades to come.

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