ORANJESTAD, Aruba — The proposal for a Kingdom Act Sustainable Public Finances Aruba (HOFA) is heading to the Council of State of the Kingdom for an opinion. The Council of Ministers of the Kingdom consented to this today. Thus, after conclusion of the consultation, another step has been taken in the realisation of this joint legislative proposal of Aruba and the Netherlands.
The Consensus Kingdom Act (HOFA) establishes the guidelines for the realisation and preservation of healthy government finances of Aruba. A responsible budget and good financial management contribute to this. The Consensus Kingdom Act goes hand in hand with the ‘National Ordinance Safeguarding Sustainable Public Finances’ (Lwho). This is legislation of the country Aruba itself. The standards in the Kingdom Act and the National Ordinance are based on recommendations of the International Monetary Fund.
Lower interest burden
Once the Act has come into force, Aruba can rely on a borrowing facility with the Netherlands. For instance, the country can borrow money for making public investments at the same favourable conditions of the Netherlands. In addition, the Netherlands is willing to refinance a part of the Aruban loans on the American capital market. It was also agreed that Aruba is going to pay a lower interest rate on the loan that it took out with the Netherlands during the Covid-19 pandemic. All these arrangements ensure that the interest burden of Aruba is lowered. The interest saved by Aruba can be used for investments in the country itself, e.g. in education, health, and economy.
State Secretary of the Interior and Kingdom Relations Eric van der Burg: “Another important step has been taken towards healthy public finances for Aruba. The Netherlands and Aruba have collectively been working on the legislative proposal since mid-2024 in order that the Aruban government can also make more investments in the longer term that benefit the residents and the economy. Thus, sustainable public finances, supervision, and the borrowing facility are, just as in the case of Curacao and St. Maarten, regulated in a Kingdom Act. I am glad that we are all pulling together on this.”
Prime Minister of Aruba Mike Eman: “This is an important moment of calm for Aruba and the Kingdom. Especially in a world that is becoming increasingly turbulent and unpredictable, it is crucial that trust, stability, and cooperation exist within the Kingdom. Through cooperation, we can better meet the challenges of our time and work on investments that serve the Common Good of Aruba and the Kingdom.”
