At the CBSC press conference were, from left: Data & Statistics Officer Ren-Dwina Browne, Economic Analysis & Research Specialist Jason Lista, and Manager Monetary Policy Economics & Statistics, Candice Henriquez. (Robert Luckock photo)
PHILIPSBURG--"We see an unusually high economic uncertainty in the international environment, both from the geopolitical and trade perspective, but that has been the case, on and off since 2022 with some variations, on the other hand we see a very strong domestic growth coming from external and domestic demand,” said Central Bank of Curaçao and Sint Maarten (CBCS) President Richard Doornbosch in his introduction by video link at a press conference on Tuesday on the economic development of the monetary union of Curaçao and Sint Maarten.
He added: “the message is we have to take advantage of this strong domestic growth to prepare for future risks. We have to increase energy and climate resilience, we have to ensure this growth is inclusive to benefit all, and that tourism is sustainable to take into account the strengths that are there.”
Manager Of Monetary Policy, Economics & Statistics, Candice Henriquez, in her presentation of the economic outlook in the international environment said growth for growing, advanced and emerging economies, is expected to ease this year due to the ongoing conflict in the Middle East.
“If we look at country groups, we see that the effect of the conflict is more pronounced for emerging and developing economies. That has to do with geographical proximity for some of them but also a higher dependence on crude oil from the Middle East. In the US the economy is projected to pick up this year despite elevated inflation, due to the fiscal stimulus of the Trump administration.
"On the other hand in the Netherlands growth is easing considerably because of the conflict in the Middle East, higher inflation and supply chain disruptions. Next year it is expected economic growth will pick up in the world for most economies based on the assumption that the Middle East conflict will be resolved. Gradually over the second half of the year the oil prices will gradually go down. Of course it’s a very fragile situation."
Global inflation
Global inflation is expected to pick up also in the US in line with crude oil prices, however in 2022, the effect on inflation following the COVID pandemic and the invasion of The Ukraine by Russia, oil prices picked up strongly and led to higher inflation than what is expected now. The perception of geopolitical risk has also been increasing, reaching a peak when Russia invaded Ukraine in 20222 and also this year with the escalation of the Middle East conflict.
Growth in the monetary union
Visual of economic growth in the monetary union.
Growth continues across the monetary union. According to CSBC estimates, in Sint Maarten there was 3.5% growth last year driven by domestic and foreign demand. Domestic demand attributed to private investment increasing in several residential and tourism projects. Private consumption also went up due to lower inflation. This year growth is expected to ease slightly to 2.6% and next year to 2.2%. In the medium term, growth will continue in Sint Maarten with CSBC’s forecast up to 2030 hovering around 2%.
Tourism development
The number of cruise passengers in 2025 exceeded all expectations, with a growth of 16%. This was due to more deployment of cruise ships to the region but also changes in itinerary due to Hurricane Melissa that hit Jamaica which destroyed part of their port infrastructure, and subsequently increased demand for cruise travel. With stay-over tourism there was a strong increase in 2025. That has to be interpreted with caution due to immigration authorities in Sint Maarten improving the registration system at the airport, so the data for 2024 and 2025 are not completely compatible.
“What we have seen so far in the monetary union is that the conflict in the Middle East has not affected tourism so far, even though airline ticket prices have increased and inflation is elevated. People are choosing to come to the Caribbean because it is perceived as safe, rather than travelling to the Middle East or Asia,” said Henriquez
Fiscal situation
in Sint Maarten
The fiscal stance of Sint Maarten improved in 2024 with a balanced operational budget. In 2025 Sint Maarten recorded a surplus of 0.7%. This was due to tax revenues increasing because of economic activity and by the government efforts to increase compliance. Expenditures also increased on the government side, and on wages and salaries. CSBC expects the fiscal situation to keep improving reaching a surplus of 2.2% by the end of the forecast horizon.
Domestic risk
The domestic risk profile has not changed. Slower than anticipated execution of public investments. Both governments borrow for public investments. Climate vulnerability from extreme weather events is a factor for Sint Maarten in the hurricane belt, but this year there is also the El Niño effect. El Niño could lead to higher food prices in the monetary union.
Fuel prices
Both Curaçao and Sint Maarten import gasoline and diesel and prices tend to move in the same direction. Prices tend to be higher in Sint Maarten than in Curaçao. Prices in Sint Maarten exceeded the peak in 2022 and that has not happened yet in Curaçao. Diesel prices are also higher than in Curaçao. Comparing 2022 and now, in 2022 the governments in Sint Maarten and Curaçao came in with tax exemptions, in Sint Maarten particularly on gasoline because there is no sales tax on diesel.
“We don’t know what is going to happen with fuel prices," admitted Henriquez. “Every day the price fluctuates and the conflict is not over. Every time there is a threat the price goes up. Prices also have to do with inventory dynamics. Curaçao has more storage capacity. There is a fuel pricing mechanism that is adjusted on a monthly basis, and there is a correction factor. In Sint Maarten it’s more on an ad hoc basis.”
