annual report 2013jan 25, 2019 · • consumer price inflation fell to 2.5% in 2013 due to a...
TRANSCRIPT
8/18/2014
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Annual Report2013
Centrale Bank van Curaçao en Sint Maarten
August 18, 2014
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Outline presentation
•Developments in:- Real sector- Public sector- External sector- Monetary and financial sector
•Outlook for 2014 & 2015
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Real sector
3
4
Developments in the monetary union
2011 2012 2013
Current account balance (in mln NAf.) -1,466.5 -1,388.8 -1,155.8
Change in gross foreign reserves of the
central bank (in mln NAf.)*-48.4 277.5 47.9
Change private loans (%) 5.4 4.8 -1.0
Curaçao 8.9 8.6 -0.6
Sint Maarten -2.4 -4.7 -1.9
Real GDP growth (%)
Curaçao 0.6 -0.1 -0.8
Sint Maarten -1.5 1.5 0.9
Inflation (%)
Curaçao 2.3 3.2 1.3
Sint Maarten 4.6 4.0 2.5
*- sign means an increase
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1.9%
3.9% 0.6% -2.4%
1.5%
40.6%
2.1%
1.3% 21.1%
-1.2% -0.8% 2.5% 2.5% 6.7%5.3%
9.6%
8.1%
7.8% 7.5%
7.4%
7.6%
5.6%
2.8%
-1.3%Aruba
United
States
Venezuela
Netherlands
5
Macro-economic key figures: a comparison
Real GDP Consumer prices Unemployment rate
2012 2013 2012 2013 2012 2013
6
Sectoral performance in Curaçao in 2013
• Decline in transport, storage & communication
sector.
- Drop in air transport.
- Drop in sea transport.
• Expansion in the manufacturing sector.
- Increase in ship repair activities.
- Activity growth at the refinery.
• Slowdown in restaurants & hotels sector.
- Slower growth in stay-over tourism.
- Increase in cruise tourism.
• Decline in wholesale & retail trade sector.
- Decline in free zone activities.
- Drop in domestic demand.
• Decline in financial intermediation sector.
- Decline in domestic financial services.
- Decline in international financial services.
• Decline in construction sector.
- Less private investments.
- More public investments.
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Economic development Curaçao
-0.1%-0.8%
3.2%
1.3%
-1%
0%
1%
2%
3%
4%
2009 2010 2011 2012 2013
Real GDP Inflation
• Real GDP in Curaçao contracted
by 0.8% in 2013.
• Inflationary pressures eased to
1.3% as a result of lower fuel
prices.
Curaçaolabor market developments
2011 2013
Employed population 62,042 63,493
Unemployed population 6,721 9,512
Labor force 68,763 73,005
Total population 147,858 150,782
Participation rate 46.5% 48.4%
Unemployment rate 9.8% 13.0%
Youth unemployment rate 24.7% 37.2%
Source: CBS, Labor Force Survey 2013
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• Sint Maarten recorded a real GDP growth of 0.9% in
2013.
• Consumer price inflation fell to 2.5% in 2013 due to a
slowdown in food price gains and lower electricity prices.
Main developments in Sint Maarten in 2013
Sectoralperformance in
Sint Maarten in 2013
• Higher growth in the wholesale & retail trade sector.- Increase in domestic spending.- Slowdown in tourism spending.
• Growth in the construction sector.- Increase in private investments.- Increase in public investments.
• Slowdown in the restaurants & hotels sector.- Slowdown in stay-over tourism.- Slowdown in cruise tourism.
• Increase in the manufacturing sector.- More yacht repair activities.
• Decline in the transport, storage & communication sector.- Decline in harbor activities.- Growth in air transportation activities.- Slowdown in airport-related activities.
• Decline in financial intermediation sector.- Drop in the net interest income of
domestic commercial banks.
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Public sector
Main developments Curaçao
12
• During 2013, the government implemented a package of
fiscal austerity measures to comply with the instruction
given by the Kingdom Council of Ministers in 2012.
• Measures led to an improvement of the public finances:
• Budget surplus in 2013, following a deficit in 2012.
• Improvement in primary balance.
• Currently, the government is complying with the rules
stated in the Kingdom Act Financial Supervision Curaçao
and Sint Maarten.
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13
-154 -36
83
1,717 1,697
1,5311,564 1,661
1,614
-500
0
500
1,000
1,500
2,000
2,500
3,000
2009 2010 2011 2012 2013
NA
f. m
ln
Budget balance Total expenditures Total revenues
Budget development Curaçao
Public debt and GDP: Curaçao
14
1,858 1,943
5,605 5,633
33% 34%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
0
1,000
2,000
3,000
4,000
5,000
6,000
2010 2011 2012 2013
NA
f m
ln
Total public debt GDP Debt-to-GDP ratio
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8
Main developments
Sint Maarten
15
• On September 16, 2013, the government’s budget for 2013 was
signed into law.
• The government registered for the third consecutive year a budget
deficit. However, the deficit narrowed in 2013 compared to 2012.
• Primary balance became positive.
• Ongoing focus on establishing the necessary institutions for the
country of Sint Maarten.
• However, financial constraints continue to hamper this development.
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Budget development SintMaarten
-5 -23 -5
408434 427
403 411 422
-40
60
160
260
360
460
2011 2012 2013
NA
f. m
ln
Budget balance Total expenditures Total revenues
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Public debt and GDP: Sint Maarten
17
* CBCS estimate
353 426
1,760 1,824
22%
26%
0%
5%
10%
15%
20%
25%
30%
35%
0
250
500
750
1,000
1,250
1,500
1,750
2,000
2010 2011 2012 2013*
NA
f m
ln
Total public debt GDP Debt-to-GDP ratio
18
5 year government bond yield(31 December 2013)
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
Curaçao & Sint Maarten
Trinidad and Tobago
The Bahamas
Dominican Republic*
Barbados Jamaica
*Data refers to 1 July 2014.
Source: CBCS & Bloomberg
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19
1-year Treasury bill yield (2013)
0%1%2%3%4%5%6%7%8%
20
External sector
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Main developments 2013
21
• Narrowing of current account deficit.
• Decline net capital transfers from abroad.
• Increase in external financing albeit at a slower
pace than in 2012.
• As foreign financing was not sufficient to cover
current account deficit, gross official reserves
declined.
Balance of payments
22
47.9277.5-48.4- 27.4Change in reserves
964.0941.11,318.3155.3External financing
62.269.7123.11,200.8Capital account
- 1,155.8- 1,388.8- 1,466.6- 1,427.8Current account
2013201220112010
(transaction basis, NAf mln)
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Balance of payments developments (in % of GDP)
23
-21.2%-19.4%
-15.9%
19.0%
13.5%
13.0%
-30%
-20%
-10%
0%
10%
20%
30%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Current account balance External financing to the private sector
Contribution to foreign exchange income* in 2000 and 2013
(Curaçao)
Freezone17% Bunkering
6%Merchandise
excl. freezone 11%
Transportation7%Refining
16%
Tourism14%
International financial services18%
Other services11%
2000
Freezone12%
Bunkering14%
Merchandise excl. freezone
3%
Transportation7%
Refining17%
Tourism27%
International financial services4%
Other services10%
2013
24
*Income from the export of goods and services.
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Contribution to foreign exchange income* in 2000 and 2013
(SintMaarten)
Merchandise 10%
Transportation2%
Tourism79%
International financial services
2%
Other services7%
2000Bunkering
3%
Merchandise 11%
Transportation2%
Tourism71%
International financial services1%
Other services11%
2013
25
*Income from the export of goods and services.
Tourism sector
26
972 1,044
1,507 1,535
0
400
800
1,200
1,600
2009 2010 2011 2012 2013
NA
f. m
illi
on
Curacao Sint Maarten
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International financial sector
27
181 181
4117
0
100
200
300
400
2009 2010 2011 2012 2013
NA
f. m
illi
on
Net operational income Profit tax BRK windfall
Refining fee(Curaçao)
28
584
659
0
100
200
300
400
500
600
700
2009 2010 2011 2012 2013
NA
f. m
illi
on
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Monthly import coverage
29
0
1
2
3
4
5
Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14
Months
Import coverage norm Import coverage Import coverage estimate
Openness vsreal GDP growth(2011 – 2013)
30
Source: CBCS and CBA.
Average
openness
Average real
GDP growth
Curaçao 168.1% -0.1%
Sint Maarten 253.1% 0.3%
Aruba 313.2% 2.0%
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Real Effective Exchange Rate Curaçao
31
-1
0
1
2
3
92
94
96
98
100
102
2007 2008 2009 2010 2011 2012 2013
REER Curacao Real GDP growth Curacao (%)
Real Effective Exchange Rate SintMaarten
32
-2
-1
0
1
2
3
4
5
92
96
100
104
108
112
2007 2008 2009 2010 2011 2012 2013
REER Sint Maarten Real GDP growth SXM (%)
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17
33
Monetary and financial sector
Main monetary developments
34
• Marginal increase in money supply.
• Decline in private credit extension.
• Commercial bank lending rates increased
slightly while borrowing rates remained
about the same.
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Money supply
3,5413,9213,900
3,566
0
1,000
2,000
3,000
4,000
5,000
2009 2010 2011 2012 2013
NA
f. m
illi
on
Net domestic assets Net foreign assets35
Net domestic credit
19676
218
-66-100
370
-1,100
-800
-500
-200
100
400
700
2009 2010 2011 2012 2013
NA
f. m
illi
on
Government Private sector Other36
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Domestic interest rates(commercial bank borrowing rates)
0%
2%
4%
6%
8%
10%
Passbook savings Time deposits (12 months)37
Domestic interest rates(commercial bank lending rates)
0%
4%
8%
12%
16%
Mortgages Time loans38
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Interest spreadtime loan vs. time deposit
0%
2%
4%
6%
8%
10%
12%
14%
Time loans Time deposits (12 months)39
Interest spreadmortgages vs. passbook savings
40
0%
2%
4%
6%
8%
10%
12%
Mortgages Passbook savings
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Domestic interest rates(government securities)
0%
2%
4%
6%
8%
10%
Gov. bond (5yr, eff. yield) Treasury bills (12 month)41
Private credit extension (year-on-year growth)
42
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
Loans to the private sector Loans to the private sector Curaçao
Loans to the private sector Sint Maarten
8/18/2014
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Development in loans Curaçao (percentage changes)
43
4.1%
-5.8% -3.1%
-20%
-10%
0%
10%
20%
30%
40%
Mortgages Consumer Loans Business Loans
2010 2011 2012 2013
Development in loans Sint Maarten (percentage changes)
44
4.2%
-5.6%-6.7%
-10%
-5%
0%
5%
10%
Mortgages Consumer Loans Business Loans
2010 2011 2012 2013
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Monetary policy stance in 2013
45
The Bank continued with its tight monetary policy stance:
•Gradual increase of the percentage of the reserve requirement.
•Auctioning of more certificates of deposit against various
maturities.
•Extension of the credit measure.
Timeline monetary policy
46
16 September 2011 – 15 June 2014 Monetary tightening by gradually increasing the reserve
requirement percentage from 9.75% to 18.00%.
1 March 2012 – 31 August 2012 Introduction temporary credit freeze.
1 September 2012 – 28 February
2013
Prolongation temporary credit measure while allowing 1%
growth in credit extension compared to August 2012.
1 March 2013 – 31 August 2013 Prolongation temporary credit measure while allowing 2%
growth in credit extension compared to August 2012.
1 September 2012 – 28 February
2014
Prolongation temporary credit measure while allowing 3%
growth in credit extension compared to August 2012.
1 March 2014 – 31 August 2014 Prolongation temporary credit measure while allowing 4%
growth in credit extension compared to August 2012.
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Main financial developments
47
• Banks:
- Worsening of capitalization, although still
relatively strong.
- Further increase in non-performing loans.
- Decline in profitability.
- Increase in assets, albeit less pronounced
than in 2012.
Capital adequacy
48
11.5%10.9%
0%
2%
4%
6%
8%
10%
12%
14%
2009 2010 2011 2012 2013
Total capital / total assets 8% norm
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Assets quality
49
3.2%3.8%
8.2% 8.3%
3.1% 3.2%
0%
2%
4%
6%
8%
10%
2009 2010 2011 2012 2013Gross specific provisions-to-total loans Non-performing loans-to-total loans
Gross general provisions-to-total loans
Earnings & profitability
50
1.7%
1.1%
0%
1%
2%
3%
2009 2010 2011 2012 2013
Return-on-assets 0.6% norm
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Development in profit commercial banks
(in millions NAf.)
51
0
50
100
150
200
250
300
2009 2010 2011 2012 2013
Commercial banks: Net Operating Income
52
Outlook 2014 & 2015
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53
Expected developments in the monetary union in 2014 & 2015
2012 2013 2014** 2015**
Current account balance (in mln
NAf.)-1,388.8 -1,155.8 -1,214.0 -1,338.5
Change in gross foreign reserves
of the central bank (in mln
NAf.)*
277.5 47.9 -211.4 -85.0
Real GDP growth (%)
Curaçao -0.1 -0.8 -0.4 0.5
Sint Maarten 1.5 0.9 1.4 1.6
Inflation (%)
Curaçao 3.2 1.3 1.1 1.0
Sint Maarten 4.0 2.5 2.4 2.2
*- sign means an increase
** projection CBCS.
Expected developments in Curaçao in 2014
54
• The Curaçao economy is projected to contract
by 0.4% in 2014 ascribable to a decline in net
foreign demand, mitigated by an increase in
domestic demand.
• Inflation will ease to 1.1%, supported by a
projected decline in international food prices.
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Expected developments in Sint Maarten in 2014
55
• Sint Maarten’s real GDP is estimated to
grow by 1.4% in 2014, mainly due to the
tourism sector.
• Inflation will ease to 2.4%, driven mainly
by projected lower average international
food prices.
Expected developments in Curaçao in 2015
56
• Curaçao’s economy is projected to expand by
0.5% in 2015, due to an increase in domestic
demand, mitigated by a decline in net foreign
demand.
• Consumer price inflation is expected to ease to
1.0% because of a projected decline in average
international oil and food prices
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Expected developments in Sint Maarten in 2015
57
• Sint Maarten’s real GDP is estimated to
grow by 1.6% in 2015 as it will benefit
from the projected economic growth in
the United States and Europe.
• The inflation rate is projected to ease to
2.2% because of an expected decline in
average international oil and food prices.
Projection balance of payments 2014 & 2015
58
-85.0-211.447.9277.5Change in reserves
203.6507.2268.9573.7Portfolio investments
780.0576.3557.4260.3Loans and credits
250.0185.0114.8133.4Direct investments
1,233.61,268.5967.4941.1External financing
8.310.262.269.7Capital account
-1,338.5-1,214.0- 1,155.8- 1,388.8Current account
2015201420132012
(transaction basis, NAf mln)
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