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Annual Report 2003 Bank van de Nederlandse Antillen

Annual Report 2003 Bank van de Nederlandse Antillen. Willemstad, July 5, 2004. Developments in the real sector. Macro-economic key figures main trading partners. Further strengthening US economy. Further deterioration Dutch and Venezuelan economies. A regional perspective (2002).

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Annual Report 2003 Bank van de Nederlandse Antillen

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  1. Annual Report 2003Bank van de Nederlandse Antillen Willemstad, July 5, 2004

  2. Developments in the real sector Annual Report 2003

  3. Macro-economic key figures main trading partners • Further strengthening US economy. • Further deterioration Dutch and Venezuelan economies. Annual Report 2003

  4. A regional perspective(2002) Annual Report 2003

  5. Economic developmentNetherlands Antilles • Real growth GDP increased from 0.4% in 2002 to 1.4 % in 2003. • Inflation increased from 0.4% in 2002 to 1.9% in 2003. Annual Report 2003

  6. Main developments in 2003 • Continuation economic recovery: • Growth export • Higher consumption (private and government) • Export growth due to: • Further growth in tourism. • Favorable performance transportation sector. Decline in private investment. • Decline in activities international financial and business services sector. • Increase in unemployment rate. Annual Report 2003

  7. Main developments in 2003 (cont.) • Increase in inflation: • Increase utility prices due to higher oil prices • Appreciation euro • Higher inflation main trading partners USA and Venezuela Annual Report 2003

  8. Labor market of the Netherlands Antilles • Increase in unemployment rate because labor force grew stronger than employment. • Increase in labor force due to higher migration to the islands and legalization illegal aliens. Annual Report 2003

  9. Public sector developments Annual Report 2003

  10. Budgetary developmentGeneral Government(Cash basis; NAf mln) • Higher expenditures due to goods & services, interest payments and capital transfers. • Higher revenues due to transfer dividend tax by Dutch government and dividends government-owned companies. Annual Report 2003

  11. Overview cash operations General Government(Cash basis; NAf mln.) • Cash deficit first quarter 2004 amounts to NAf 51 million. Annual Report 2003

  12. Composition of revenuesGeneral Government Share taxes on goods & services almost doubled due to introduction sales tax. Annual Report 2003

  13. Composition of expendituresGeneral Government Decline share personnel costs due to lay-offs Increase share interest payments due to rising debt Annual Report 2003

  14. Budgetary developmentCentral government(Cash basis; NAf mln.) • Higher expenditures due to goods & services, transfers to other levels of government and capital transfers. • Higher revenues due to transfer dividend tax by Dutch government. Annual Report 2003

  15. Budgetary developmentCuracao(NAf mln.) • Higher revenues due mainly to share in transfer dividend tax by Dutch government and dividend government-owned companies. • Higher expenditures due mainly to goods & services and personnel costs (pension premiums). Annual Report 2003

  16. Development in total public debt(NAf mln.) • Total debt 4.4 billion • 90% of GDP Annual Report 2003

  17. Development in total public debt (cont.)(NAf mln.) • Share domestic component of 82% in 2003. Annual Report 2003

  18. Development in interest payments(NAf mln.) • Interest payments amounted to NAf 252 million in 2003 (24% of tax revenues and 17% of expenditures). Annual Report 2003

  19. Net borrowing of the governments Note: 2003 central government excluding debt conversion SVB (NAf. 342 million) • Net borrowing up to June 30, 2004: NAf 197 million • Central government NAf 113 million • Curacao NAf 84 million Annual Report 2003

  20. Government bonds maturity scheduleAs per June 30, 2004 • Average annual maturity 2004-2011: NAf 221 million • Central government NAf 142 million • Curacao NAf 79 million Annual Report 2003

  21. The external sector Annual Report 2003

  22. Balance of payments Transaction basis (NAf mln.) • Balance of payments surplus of NAf 35 million in 2004-I. Annual Report 2003

  23. Current account balance(NAf mln.) • Small surplus in 2003 due mainly to higher earnings from bunker sales and tourism. Annual Report 2003

  24. Foreign exchange revenues from services(NAf mln.) Annual Report 2003

  25. Tourism revenues by islandCash basis (NAf mln.) • Shares in 2003: • St. Maarten 62% • Curacao 34% • Bonaire 4% Annual Report 2003

  26. Foreign exchange contribution international financial and business services sector(NAf mln.) • Higher profit tax in 2003 due to transfer of dividend tax by the Netherlands (NAf. 54 million). Annual Report 2003

  27. Composition current foreign exchange revenues 2003 Annual Report 2003

  28. Development in international reserves (1) • Import coverage on June 25, 2004: 2.7 months. Annual Report 2003

  29. Monetary developments Annual Report 2003

  30. Development in the money supply(NAf mln.) • Money supply increased by 8% in 2003 (NDA 8% and NFA 9%) Annual Report 2003

  31. Changes in domestic demand for money by sector(NAf mln.) • Monetary expansion by the government and the private sector slowed in 2003. Annual Report 2003

  32. Development in credit extension Leeward Islands Total Annual Report 2003

  33. Development in credit extension Windward Islands Total Annual Report 2003

  34. Development in domestic interest rates • Commercial bank rates continued to decline. • Government bond yield started to increase again. Annual Report 2003

  35. The financial sector Annual Report 2003

  36. Macro-prudential indicators Annual Report 2003

  37. Balance sheet development domestic banks(NAf mln.) • Assets increased by 4.8% in 2003: • Increase in lending. • Increase in cash holdings. • Increase in assets funded primarily by savings and time deposits. • Capitalization remained adequate. Annual Report 2003

  38. P & L development domestic banks(NAf mln.) • Higher operational income in 2003 due to “other income.” • Slight decline in expenditures. • Net operating income before taxes improved to NAf 95.3 million. Annual Report 2003

  39. Balance sheet development international banks(NAf bln.) • Assets decreased by 5.4% in 2003 due to decline in loans. • Borrowings comprised 55% of total funding. • Capitalization above international standard of 8%. Annual Report 2003

  40. Institutional investors Annual Report 2003

  41. Solvency insurance sector(NAf mln.) Annual Report 2003

  42. Balance sheet domestic life insurance sector(NAf mln.) • Total assets increased by 8.3% in 2002. • 74% of total assets comprises investments. • Equity position three and a half times more than required. Annual Report 2003

  43. Balance sheet domestic nonlife insurance sector(NAf mln.) • Total assets increased by 75.6% in 2002 reaching pre-1999 levels. • 47% of total assets was invested. • Capitalization increased and remained well above the required solvency margin. Annual Report 2003

  44. Net income domestic insurance companiesBefore taxes (NAf mln.) • Net result life insurance industry declined to NAf 14.0 million (14.1%) in 2002 due mainly to higher net benefits paid. • Net result nonlife insurance industry back to normal levels; 2001 was exceptional due to: • low net claims incurred • high underwriting profit • high net investment income Annual Report 2003

  45. The End Annual Report 2003

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