SINT MAARTEN (PHILIPSBURG) - The Government of St. Maarten and the Princess Juliana Airport Operating Company (PJIAH) must avoid renewing the cooperation agreement with Schiphol and the Netherlands without carefully examining the financial detriments of the agreement to PJIA itself.
Independent Member of Parliament (MP) Christophe Emmanuel, based on factual financial figures in his possession, said the cooperation agreement to date has only added to the financial woes of PJIA due to increased financial pressure it places on PJIAE at a time of crisis and low revenue.
This increased financial pressure, he explained, is derived from high consultant fees and fees that PJIA has to pay to Schiphol Airport for persons that Schiphol appointed to PJIA. He pointed out that consultant fees amount to more than Naf 10 million, the highest they have ever been in the history of PJIA. In fact, the MP said, consultant fees jumped from approximately Naf 4.5 million in 2017, to approximately Naf 7 million in 2018 then to the current amounts of over Naf 10 million in 2019 and 2020.
The MP said that while people think that the support/assistance from Schiphol Airport is being covered by Schiphol, it is PJIA that is carrying the load. “So much for assistance,” the MP said. He went on to break down those costs which amount to approximately US $ 2 million over the last two years.
Schiphol appointed CFO – Naf 468,000 per year (incl. travel, house rent, vehicle)
Schiphol appointed Project Controller – Naf 495,000 per year (incl. travel, house rent, vehicle)
Schiphol appointed Procurement Officer – Naf 163,000 per year (incl. house rent)
Environmentalist as per World Bank – Naf 208,000 per year
Project Manager reconstruction – Naf 477,000 per year (incl. travel, house rent, vehicle)
“It is important to mention that these amounts exclude PJIA employees as well as the amounts that Royal Schiphol Group gets from the Dutch government (BZK) which amounts to 1 million Euro per year for services rendered to PJIAE as per the existing Cooperation Agreement,” Emmanuel said, adding that the 2 million also excludes the board fees and accommodations, travel allowances and airfare costs of the Schiphol proposed board members of PJIAE and PJIAH (1 each), who reside in New York and in Florida respectively.
MP Emmanuel also reminded that to date nothing from the construction portion financed by the World Bank and the EIB and counterpart funds has been spent. Up to December 31, 2020 the Airport Terminal Reconstruction Project has spent US $11.5 million, of which US $8.3 million has been spent on the design and almost US $3.05 million on project overhead.
“All this time PJIA is hemorrhaging money, three years after hurricane Irma. PJIA is not projected to be in a positive liquidity position until 2024 and that will only become a reality if we cut back on this project and take hold of what is happening at PJIA now. PJIA could be in a negative liquidity position of almost Naf 57 million by the end of 2021 and out of money months before. In 2024 the airport will still be paying its original bond indenture loan, which runs until 2027. It is not until 2028 the airport will be free of that loan barring any other crisis.
“We have to rid ourselves of this poor management and supervisory board and these ridiculous fees that PJIAE has to pay to Schiphol. And that means the holding company dismissing the CEO and carefully considering what to do with that cooperation agreement which is coming up for renewal,” MP Emmanuel said.