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On September 10, 2024, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation discussions with the Kingdom of the Netherlands—Curaçao and Sint Maarten and endorsed the staff appraisal without a meeting on a lapse-of-time basis

Curaçao’s economy expanded strongly, continuing its pivot towards a tourism-led growth model.

GDP continues to recover thanks to strong stayover tourism and the reconstruction. Domestic imbalances have closed, with inflation declining towards 2 percent and the fiscal balance returning to a surplus in 2023, but the current account deficit remains high. An immediate solution is needed to resolve load shedding and, in the medium term, investments in renewable energy are strongly encouraged. Going forward, policies need to address long-standing structural challenges, including boosting medium-term growth, restoring the government’s competitiveness to recruit and retain talent, and dealing with mounting deficits in the healthcare insurance fund.

Context. Curaçao and Sint Maarten continue to recover from major shocks. Both countries have had two years of robust growth driven by a strong rebound of tourism, although the benefits of recovery have not reached all sectors. The recovery in tourist arrivals was among the fastest in the Caribbean and the current outcomes are above the pre-pandemic levels. Sint Maarten has further to go to reach levels seen before hurricane Irma in 2017. Similar to other countries, Curaçao experienced a strong bout of inflation, which affected the vulnerable. The international reserves of the monetary union of Curaçao and Sint Maarten remain at a comfortable level despite the elevated external current account deficit, which was due in part to higher import prices. The banking system remains well-capitalized and liquid.

Curaçao’s economy is recovering on strong tourism growth and sizeable private investment. Realizing Curaçao’s significant economic potential requires a strong development strategy supported by buy-in from stakeholders. Policies should support inclusive growth while strengthening fiscal sustainability. The recent decision to adopt a long-term debt anchor and develop an investment strategy are welcome steps towards developing a medium-term fiscal framework. Implementing the structural agenda embodied in the package of structural reforms (landspakket) agreed with the Netherlands would be key for addressing many of long-standing structural challenges. Continued efforts with financial sector and supply-side reforms remain vital for strengthening the financial stability and the external position of Curaçao and Sint Maarten’s monetary union.

Sint Maarten is experiencing strong recovery growth led by tourism and investment, but the benefits of growth are slow to reach the rest of the economy. With narrowing fiscal and external deficits, the time is ripe to advance key fiscal and structural reforms, including medium-term investment planning and execution and streamlining business procedures. This small island economy has capacity limitations in key areas, especially in economic statistics and financial intelligence, which require adequate resourcing.

IMF Executive Board Concludes 2022 Article IV Consultation Discussions with the Kingdom of the Netherlands—Curaçao and Sint Maarten

Kingdom of the Netherlands – Curaçao and the Monetary Union of Curaçao and Sint Maarten: Staff Concluding Statement of the 2022 Article IV Mission

Kingdom of the Netherlands – Sint Maarten: Staff Concluding Statement of the 2022 Article IV Mission

PRESS CENTER ... The Central Bank of Curaçao and Sint Maarten removed the restriction on transfers of ... As pervasive understaffing and funding constraints in the statistical agencies hamper ...