The Central Bank of Curaçao and St. Maarten (CBCS) confirmed that both monetary union partners saw growth last year, by respectively 7.9% and 9.8% (see Wednesday newspaper). Especially the latter is impressive, but keep in mind that St. Maarten was still bouncing back from Hurricane Irma when the COVID-19 pandemic hit and probably had a deeper proverbial hole to climb out of.
It would anyhow be best not to celebrate very much too early, as a slowdown to 3.2% has been forecast in 2023. Gross domestic product (GDP) is not expected to reach pre-Irma levels until next year.
In addition, 2022’s expansion was accompanied by inflation of 7.4% for Curaçao and 3.8% for St. Maarten, which greatly increased the number of products in its basic goods basket under government price control. That does not mean the local cost of living and doing business is lower, to the contrary.
Even though Curaçao has import duties, many things seem more expensive here, including housing. Similar inflation is also predicted in St. Maarten this year at 3.7%, so consumers will continue to face higher grocery and other bills.
Nevertheless, one can safely conclude that the recovery in both Dutch Caribbean countries has been strong. Important is to make this progress sustainable by boosting their tourism economies.
Judging from sounds within the dominant hospitality industry, a lot of work remains to be done in that regard. A solid foundation has now been laid, but the rebuilding process is still fully underway.
