CBCS President: Growth momentum strong, but protecting vulnerable households is key

WILLEMSTAD/GREAT BAY--“Curaçao and Sint Maarten have entered 2025 with renewed growth momentum, yet persistent inflationary pressures pose challenges to ensuring that the benefits of growth are widely shared. Safeguarding inclusive growth will require targeted measures to protect the most vulnerable,” said Richard Doornbosch, President of the Centrale Bank van Curaçao en Sint Maarten (CBCS), as the Bank released its September 2025 Economic Bulletin.

The quarterly bulletin points to a solid start to the year, with both economies buoyed by tourism, construction, and improved consumer confidence. But Doornbosch underscored that global uncertainties and structural constraints mean that governments cannot afford complacency.

Tourism-Led Expansion with Fiscal Stability
Sint Maarten’s economy accelerated in the first quarter of 2025, lifted by the completion of airport reconstruction at the end of 2024, ongoing commercial and residential projects, and strong performance in both stay-over and cruise tourism. Private consumption also improved, aided by lower-than-expected inflation.

Curaçao registered growth as well, supported by hotel, trade, and transport activity, along with major tourism, real estate, and utility construction projects. However, weaker cruise performance and higher international food and fuel prices offset some of these gains.

For 2025, Sint Maarten’s GDP is forecast to grow by 2.8% and Curaçao’s by 3.4%, with both economies expected to ease further to 2.4% growth in 2026. These forecasts represent upward revisions from June 2025, reflecting stronger-than-expected tourism exports.

Both countries are projected to maintain broadly stable fiscal positions. Curaçao’s surplus is estimated at 2.2% of GDP in 2025 and 2026, while Sint Maarten is expected to reach a surplus of 1.0% in both years, after balancing its budget in 2024. Nevertheless, public debt stocks will increase due to additional foreign borrowing from the Netherlands to finance capital investments.

Inflation Declines, But Risks Persist
Inflation in Sint Maarten is projected to drop sharply from 3.6% in 2024 to 2.0% in 2025 and remain at that level in 2026, while Curaçao will see steadier inflation at 2.6% in 2025 before easing to 2.1% in 2026. The outlook is largely shaped by developments in international oil and food prices, as well as the inflation trends of the union’s major trading partners, the United States and the Netherlands.

Still, the CBCS cautioned that both countries remain vulnerable to imported price shocks. “Our economies are heavily dependent on imports, which exposes households and businesses to volatility in global food and fuel markets,” Doornbosch noted. He warned that inflation hits low-income households disproportionately, as food, housing, and energy account for more than half of their spending.

Targeted Measures Over Broad Subsidies
Doornbosch emphasized the importance of well-targeted interventions over broad-based subsidies or price controls. “Short-term measures like across-the-board subsidies can provide temporary relief, but they are costly, distortive, and difficult to sustain. A more effective approach is targeted income support, complemented by active labor market policies, fair wage adjustments, and improved financial literacy,” he said.

The bulletin also calls for long-term strategies to reduce dependency on imports, including investments in renewable energy, particularly solar and wind, alongside improved storage and grid capacity. While local agriculture faces scale and climate challenges, even incremental improvements could help cushion food price shocks.

Implications for Sint Maarten
For Sint Maarten specifically, the CBCS notes that tourism will remain the backbone of growth in 2025, but warns that reliance on a single sector leaves the country exposed to external shocks such as hurricanes or global travel disruptions. Public investments in infrastructure upgrades are expected to contribute to growth, while fiscal performance is set to improve modestly, with a temporary rise in the debt-to-GDP ratio to 42.4% in 2025 before declining to 41.8% in 2026.

Doornbosch underlined the stakes: “Inclusive growth requires more than just positive GDP figures. Without resilience-building investments and policies that protect vulnerable households, the benefits of recovery will not be felt widely enough. Economic stability must go hand in hand with fairness and opportunity.”

The September 2025 Economic Bulletin also features in-depth analyses on inflation dynamics in the monetary union, the distributional effects of price increases across income groups, and the impact of price regulations such as Sint Maarten’s “Basket of Goods” program.

The full bulletin is available on the CBCS website.

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