Tourism Development and the Question of Who Truly Benefits
A Position Paper
1. The Original Promise of Tourism
Tourism was never meant to be an end in itself. For small island economies like Curaçao, tourism was promoted as a development strategy. The logic was simple.
Visitors arrive.
They spend money.
That spending circulates through the local economy.
Taxi drivers earn income.
Restaurants fill their tables.
Local shops sell products.
Tour guides create experiences.
Farmers supply food.
Construction companies build infrastructure.
Artists sell culture.
Tourism, in theory, becomes a multiplier economy. One tourist dollar generates multiple layers of local economic activity. In this model, tourism is not simply about visitors. It is about local prosperity. But when the structure of tourism changes, that multiplier effect begins to weaken. And eventually the island risks becoming something else entirely:
a backdrop for an externally controlled tourism system.
2. The Risk of the “Scenery Economy”
A dangerous transformation can occur in tourism-dependent regions. The local population becomes less involved in the economic chain. Instead of being active participants in the tourism economy, they become observers of it. The island becomes scenery. The hotels become self-contained economic islands.
Visitors arrive.
They stay inside controlled environments.
They eat inside the resort.
They drink inside the resort.
They shop inside the resort.
They entertain themselves inside the resort.
And the surrounding island becomes visual decoration rather than an economic partner.
This phenomenon has already occurred in several tourism-dependent regions. The result is a paradox. The island receives millions of visitors. But the economic benefits remain concentrated in a narrow sector.
3. The Heritage Paradox
Curaçao possesses a unique advantage compared to many other Caribbean destinations. Its tourism is not based solely on beaches. The island possesses an extraordinary cultural and historical asset:
the historic center of Willemstad, recognized by UNESCO since 1997 as a World Heritage Site.
This heritage gives Curaçao a distinctive tourism identity. Visitors do not come only for sun. They come for:
history
architecture
culture
language
urban atmosphere
Caribbean-European heritage
Heritage tourism typically produces stronger local economic circulation. Visitors walk the streets. They visit small businesses. They eat in independent restaurants. They interact with the local community. The city becomes a living economic ecosystem.
But when development begins to prioritize large-scale projects that concentrate tourism within specific zones, that ecosystem can weaken.
4. The Geography of Tourism Control
One of the most significant changes in global tourism development is the creation of controlled tourism zones. These zones concentrate hotels, restaurants, entertainment, and shopping within a limited geographic space. From a business perspective, this model has advantages. Visitors move easily between services. Hotels capture a larger share of visitor spending. Operational efficiency increases. But from a national economic perspective, the result may be different. When tourism becomes geographically concentrated, large portions of the local economy are bypassed.
Taxi drivers see fewer rides.
Small restaurants receive fewer visitors.
Independent businesses struggle to compete with integrated resort systems.
Economic circulation narrows.
Tourism still grows in volume, but its distribution of benefits changes.
5. The Question of Tax Incentives
Tourism development in many Caribbean countries has historically relied on significant fiscal incentives. These often include:
tax holidays
duty exemptions
land concessions
infrastructure support
Such incentives are designed to attract foreign investment. But they also create an important policy question. If a tourism project operates for ten, fifteen, or even twenty years with reduced tax obligations, what is the primary mechanism through which the nation benefits?
The answer must be local economic activity.
Employment.
Local purchasing.
Infrastructure development.
Business opportunities for the surrounding community.
But if tourism developments become economically self-contained, that expected national benefit becomes smaller.
6. The Labor Substitution Question
Another important factor is labor composition. Tourism development was historically promoted as a generator of local employment.
Hotels require staff.
Restaurants require cooks.
Maintenance requires technicians.
Transportation requires drivers.
But when labor shortages occur or operational costs increase, tourism developers sometimes turn to imported labor. From a business perspective, this may appear efficient. From a national development perspective, it raises an uncomfortable question. If tourism development increasingly relies on imported labor while local residents face employment challenges, the economic logic of tourism development begins to weaken.
Tourism was intended to support the prosperity of the host society.
If the benefits shift away from local workers, the social contract between tourism and society begins to erode.
7. The Long-Term Market Reality
Tourism markets are dynamic. Trends change. Consumer preferences shift. New destinations emerge.
Developers and investors are highly mobile. When market conditions change, investment capital moves elsewhere. What remains behind are the physical structures that were built during the expansion phase. This reality raises a strategic question for Curaçao.
If tourism development significantly alters the historical character of Willemstad while concentrating economic benefits within limited sectors, what will remain if tourism demand fluctuates in the future?
Historic cities that preserve their cultural identity often retain long-term value.
Those that sacrifice identity for short-term expansion sometimes discover that the market eventually moves on.
8. Heritage as Economic Infrastructure
Heritage is often misunderstood as nostalgia. In reality, it functions as a form of economic infrastructure. The historic skyline of Willemstad is not simply an aesthetic asset. It is the foundation of Curaçao’s international tourism identity. Once that identity is weakened, rebuilding it becomes extremely difficult. Cities around the world have learned that heritage protection is not an obstacle to development. It is often the foundation of sustainable tourism economies.
9. The Central Policy Question
The issue facing Curaçao is not whether tourism development should occur. Development is necessary. Investment is important. Economic growth matters. The real question is structural.
What model of tourism development will best support the long-term prosperity of the people of Curaçao? A model that distributes economic activity across the island. Or a model that concentrates activity within limited tourism enclaves.
10. The Strategic Choice
Every tourism-dependent society eventually faces a strategic decision. Will tourism function as a broad-based economic engine? Or will it become a narrow sector benefiting a limited number of actors?
If tourism development strengthens local businesses, local employment, cultural heritage, and community participation, it can remain a powerful tool for national prosperity.
But if the island gradually becomes scenery while economic activity concentrates elsewhere, the original purpose of tourism development must be reconsidered.
Final Reflection
Tourism should never reduce a nation to a backdrop. The island of Curaçao is not a stage set.
It is a living society with a history, a culture, and a people whose prosperity was meant to be the very reason tourism development began.
The question now facing policymakers, developers, and citizens alike is not simply how to attract more visitors.
It is how to ensure that tourism remains an economy for the people who call this island home.
11. The Tourism Leakage Problem
How much of the tourist dollar really stays in Curaçao?
Tourism headlines often celebrate arrivals, hotel occupancy, and new investment. But those numbers do not automatically tell us how much prosperity stays with the people of Curaçao. That is the core issue.
A tourism economy can grow in visible size while underperforming in local benefit.
The concept economists use for this is tourism leakage: the share of tourism revenue that leaves the local economy through imported goods, foreign ownership, overseas booking systems, external financing, repatriated profits, and non-local labor remittances. UN Tourism notes that in Small Island Developing States, tourism’s contribution to GDP is often reduced by these elevated leakages, while UNCTAD stresses that the critical policy question is: how much of the tourist dollar stays in the country?
The World Bank’s 2025 Caribbean tourism review makes the issue even sharper. It says that in the Caribbean, volume-based models with foreign-owned infrastructure—like all-inclusive resorts and cruise-line operations—can generate significant economic leakage, while more integrated and community-linked models retain more value locally. A World Bank technical note on inclusive tourism similarly warns that critics associate large all-inclusive hotels with high spending leakage to foreign owners.
So the real question is not only whether tourism is growing. The real question is whether Curaçao is building a tourism model that retains value or one that exports value.
A practical leakage framework for Curaçao.
Leakage happens in at least five major ways:
1. Profit leakage
If hotels, apartments, or mixed-use tourism projects are foreign-owned, part of the profits can be transferred abroad rather than reinvested locally. The larger and more externally financed the project, the greater this risk can become. This is exactly why ownership structure matters.
2. Import leakage
If hotels import food, beverages, furniture, building materials, linens, management systems, and technical services rather than sourcing them in Curaçao, a substantial part of visitor spending never circulates through local suppliers. UNWTO’s SIDS overview explicitly notes that tourism’s GDP contribution is diminished by leakages tied to imported construction materials, equipment, and other inputs.
3. Booking leakage
When bookings are captured by international platforms, tour operators, or foreign package systems before the visitor even arrives, part of the tourism value chain is already lost to the island. This is especially relevant when the destination is sold as part of a larger external distribution system rather than through locally controlled channels.
4. Labor leakage
When local workers are bypassed and imported labor fills too many positions, a share of wages leaves the island through remittances. The World Bank has also warned that leakage rises when tourism establishments hire non-local labor and rely less on domestic inputs.
5. Spatial leakage
This is the most overlooked form. Even when the hotel is physically in Curaçao, the tourist can still be economically isolated from Curaçao. If the visitor sleeps, eats, drinks, shops, and is entertained inside one tightly controlled tourism zone, the surrounding city and neighborhoods receive little benefit. The island remains visible, but economically peripheral.
That is how a country begins to look busy without truly becoming prosperous.
A quantitative estimate for Curaçao
Curaçao’s official 2024 tourism report states that tourism’s total economic impact, direct plus indirect and including cruise, was calculated at US$2.7 billion. The same report says Curaçao welcomed 700,249 stayover visitors in 2024, while the Curaçao Tourist Board reports that 2025 then rose further to 788,427 stayover visitors, with more than half of stayover visitors in 2025 staying at resort hotels.
That sounds impressive, and it is. But to understand what it means for the local population, we need to apply retention scenarios.
Because there is no single official published “Curaçao leakage rate” in the sources I reviewed, the most honest method is to present scenario estimates, not a false precision.
If we apply retention scenarios to the official US$2.7 billion economic impact number:
• If 70% stays locally, then about US$810 million leaks out.
• If 60% stays locally, then about US$1.08 billion leaks out.
• If 50% stays locally, then about US$1.35 billion leaks out.
• If only 40% stays locally, then about US$1.62 billion leaks out.
These are not claims that Curaçao currently leaks exactly one of those amounts. They are decision-making scenarios. But they make one thing very clear:
A destination can generate billions in tourism impact on paper and still leave hundreds of millions—or more than a billion dollars—weakly anchored in the local economy.
That is why the structure of development matters more than the headline number.
Why resort concentration matters
Curaçao’s own official data shows the direction of the issue. In 2025, more than 56% of stayover visitors stayed at resort hotels. In the 2024 tourism performance report, hotel use was especially dominant among North American visitors at 68%, while European visitors were more split, with 46% in hotels and 54% in other lodgings.
That matters because the accommodation mix shapes spending behavior.
A visitor staying in a self-contained resort is more likely to buy meals, drinks, experiences, and convenience services inside that ecosystem. A visitor staying in smaller lodgings, apartments, historic inns, or distributed urban accommodations is often more likely to move through neighborhoods, eat outside, use taxis, and interact with independent businesses. The World Bank’s Caribbean review supports this distinction by arguing that more community-driven and integrated models retain more revenue locally.
So the issue is not whether hotels are bad. The issue is whether Curaçao is becoming too dependent on tourism forms that centralize spending.
When that happens, the economy around tourism gets narrower.
Taxi drivers receive fewer trips.
Local restaurants lose meal traffic.
Neighborhood bars and snack operators lose spontaneous spending.
Independent guides compete against in-house experiences.
Small suppliers struggle against imported procurement chains.
The island remains full of visitors, but the people feel less of the benefit.
That is not healthy tourism development. That is a retention problem disguised as growth.
12. Curaçao 2040
A projection if current development patterns continue
What follows is not a prophecy. It is a policy scenario analysis.
If Curaçao continues to move toward larger, concentrated, fiscally favored tourism projects in and around the urban core—while weakening local linkage requirements, heritage protection, and distributed spending—the island could face a very specific 2040 outcome.
Scenario A: The Enclosed Tourism Island
By 2040, Curaçao could have even higher arrival numbers and yet weaker local economic circulation.
Stayover growth may continue, especially if new urban and coastal projects add inventory and if market demand from the Netherlands, the United States, and Colombia remains strong. Curaçao already recorded 788,427 stayover visitors in 2025, after 700,249 in 2024, so growth momentum is real.
But if that growth is captured mainly by resort-style, investor-led, or self-contained developments, the likely result is this:
More tourists. Less spread. More buildings. Less circulation.
By 2040, visitors may increasingly choose accommodations located within high-convenience clusters: lodging, restaurants, branded retail, curated nightlife, wellness, and excursion sales all within walking distance. That model is commercially attractive because it keeps spending inside the same ownership or partner network. The World Bank warns this kind of foreign-owned, volume-based tourism structure can produce significant leakage.
In that future, Willemstad risks becoming a consumption corridor, not a living heritage economy.
The city still looks active.
Cruise days still feel crowded.
Hotel occupancy may remain solid.
Investors still market “location, location, location.”
But much of the value is captured before it reaches the broader society.
The side effects would likely include:
• lower real participation by local micro and small businesses
• more pressure on land prices in and around the city
• stronger displacement of local residents and traditional commerce
• a growing gap between visible tourism wealth and lived local prosperity
• more dependence on imported workers and imported supply chains if training and local sourcing do not keep up
• a weaker connection between tourism growth and broad social mobility
And if heritage controls continue to erode under the argument that “development cannot be blocked forever,” the city may also lose part of the visual and cultural uniqueness that made it attractive in the first place. That is the trap.
First the heritage creates the value.
Then the value attracts development.
Then uncontrolled development weakens the heritage.
Then the destination must compete without the very uniqueness that made it special.
That is how an island becomes scenery.
Scenario B: The Distributed Prosperity Island
There is another path.
By 2040, Curaçao could decide that tourism growth is welcome, but only if it is anchored more deeply in the local economy.
That means not simply counting arrivals, but measuring:
• local sourcing rates
• local employment rates
• local ownership participation
• local tax contribution over time
• neighborhood spillover spending
• heritage preservation outcomes
In that model, the historic city is treated not as empty “development opportunity,” but as economic infrastructure. Heritage is preserved because it generates differentiated value. Smaller urban hotels, guesthouses, apartments, cultural venues, restaurants, galleries, neighborhood commerce, and walkable heritage experiences become part of a distributed network rather than being crushed by a few dominant nodes.
This model would not reject investment. It would discipline it.
It would ask every major project:
How many local jobs?
How much local procurement?
How much tax contribution after incentives?
How much value reaches taxi drivers, guides, artists, neighborhood businesses, and local suppliers?
How does the project protect the historic urban landscape that the whole destination depends on?
In this future, the city remains alive, not sterilized.
The tourist sees Curaçao, not only the hotel’s version of Curaçao.
And prosperity spreads more widely through the population.
That is valuable development.
The real 2040 choice
So by 2040 Curaçao may not be choosing between “development” and “no development.”
That is the wrong frame.
The real choice is between:
A high-arrival, high-leakage, externally captured tourism economy
or
A high-value, heritage-anchored, locally circulating tourism economy. One produces impressive brochures. The other produces deeper national benefit. One fills the skyline with investment. The other fills the society with participation. One says tourism is growing.
The other asks: for whom?
The strategic conclusion
If Curaçao does not actively manage tourism leakage, protect heritage value, and strengthen local linkages, then by 2040 it may discover that it succeeded in growing tourism while failing to grow shared prosperity.
That would be the most painful failure of all. Because tourism was never supposed to turn Curaçao into a backdrop. It was supposed to help make Curaçao more prosperous for the people whose culture, labor, memory, and landscape created the destination in the first place.