Although unable to calculate St. Maarten’s real gross domestic product (GDP) growth during the third quarter of 2017 (see Thursday paper), the Central Bank estimates a decline of 4.4 per cent for that entire past year and predicts another one of 9.5 per cent in 2018. Although still subject to change, the latter is significant.
Such a close-to-double-digit downturn is understandable considering the circumstances, with especially the dominant stay-over tourism sector badly hit. That does not change the fact that there will be dire consequences in terms of less income, more unemployment and an increase in poverty that could in turn lead to a highly undesirable rise in crime especially for a vacation destination.
The biggest challenge facing whatever government is in office will therefore be how to mitigate those negative effects until the hospitality industry has sufficiently recovered. That can be achieved through initiatives like the various ongoing programmes for home repair, paid upgrading courses for service personnel temporarily without a job as well as retraining people to work in the construction field where the current demand for labour is high.
To have a lasting positive impact on the local economy, infrastructural and other projects that will be realised with the rebuilding funds made available by the Netherlands through the World Bank should not only contribute to the quality of life under difficult social conditions, but also promote the revival of the local business community and particularly the reopening of now-closed major resorts. While these are privately-owned, it’s important to see what may be done to expedite that process in the general interest.
