WILLEMSTAD – The potential return of Donald Trump as President of the United States in 2025 is raising concerns about significant policy shifts that could directly impact Curaçao and Sint Maarten. Both islands, heavily reliant on trade and tourism with the U.S., are bracing for possible economic ripple effects, according to an analysis by Nanette Vellekoop, research analyst and specialist at the Central Bank of Curaçao and Sint Maarten (CBCS).
The islands import about half of their goods and services from the U.S., with Sint Maarten exporting 64% of its goods to the American market. Potential protective trade measures, such as increased tariffs on Chinese goods, could drive up U.S. inflation. Given the historical linkage between inflation in the U.S. and that in Curaçao and Sint Maarten, rising prices in the U.S. would likely affect local economies.
Tourism at Risk
Tourism, a cornerstone of both islands’ economies, could also be vulnerable. While tariffs may not directly impact the industry, higher inflation in the U.S. might prompt the Federal Reserve to maintain elevated interest rates.
This could strengthen the U.S. dollar against the euro, making travel to Curaçao and Sint Maarten more expensive for European tourists. Simultaneously, higher inflation could erode the purchasing power of American travelers, potentially reducing the number of visitors from the U.S.
Venezuela and Climate Concerns
Tougher U.S. policies toward Venezuela could lead to stricter sanctions, exacerbating issues like illegal migration flows to Curaçao. Furthermore, a potential rollback of climate initiatives under a Trump administration could negatively affect the Caribbean region, which is particularly vulnerable to climate change, in the long term.
Opportunities and Challenges
The Central Bank highlights that anticipated U.S. policy changes present both risks and opportunities for Curaçao and Sint Maarten. While potential tax cuts and lower energy costs in the U.S. could have positive effects, challenges related to trade, inflation, and tourism remain significant.
The CBCS calls for proactive strategies to navigate these shifts and mitigate the potential economic impact on the islands.