WILLEMSTAD – Curaçao’s construction sector closed 2025 with strong momentum, expanding by 9.6 percent in real terms, but the latest industry survey also signals a turning point: the island’s building pipeline is increasingly constrained by structural bottlenecks rather than demand.
The Construction Survey Report 2025, compiled by the Centrale Bank van Curaçao en Sint Maarten (CBCS) on the basis of responses collected in August and September 2025, confirms that construction remains one of Curaçao’s most dynamic sectors, supporting private real estate activity, infrastructure works and a range of specialized services. At the same time, the report makes clear that the conditions underpinning growth have become more fragile. Shortages of skilled workers, dependence on imported materials and rising transport costs are shaping how fast—and how affordably—the sector can keep expanding.
A sector growing faster than its capacity
At first glance, the headline numbers are encouraging. Output rose strongly in 2025, and firms in Curaçao were generally more optimistic than those in Sint Maarten, with expectations of improvement in the business climate and a stronger competitive position in the local market.
Yet the composition of Curaçao’s construction industry explains why capacity constraints are now coming into focus. The sector is dominated by micro and small businesses: roughly three-quarters of firms employ fewer than five full-time workers, while only a small share has a workforce above 50. That structure can be a strength in normal times—small companies can adapt quickly—but it also means the industry has limited buffers when faced with spikes in demand, shipping disruptions or sudden price increases for cement, steel, fixtures and specialized equipment.
The survey also shows that while most firms operate mainly in the domestic market, nearly half depend on imported materials and services. For an island economy, that import dependence is not surprising, but it carries a specific vulnerability: construction costs in Curaçao can swing sharply with international freight rates, supply chain delays and global commodity prices.
Labor shortages are no longer a side issue
The most decisive constraint identified by companies is labor. More than half of firms reported difficulty finding workers, and a large majority described recruiting skilled labor as difficult or very difficult. The pressure is concentrated in trades that are essential to project delivery—electricians, plumbers, carpenters and other skilled craft positions—rather than in management or design roles.
This has two immediate economic consequences. The first is scheduling risk. When skilled trades are scarce, project timelines stretch and contractors are forced into sequencing problems, waiting longer for the right worker at the right stage of construction. The second is cost. Even if wage growth is not explosive, scarcity raises the premium for reliable skilled labor and increases the likelihood that developers and homeowners pay more to secure availability.
In the CBCS survey, the labor shortage stands out as the dominant obstacle, cited by a clear majority of respondents as the sector’s main challenge—well ahead of input prices and regulatory issues. That ranking matters. It suggests that even if inflation cools and material prices stabilize, Curaçao could still face a construction “capacity ceiling” unless the island expands vocational training and creates stronger pipelines into skilled trades.
Why inflation can be moderate while construction prices rise
A key point for consumers and policymakers is that construction prices can rise faster than general inflation. Curaçao’s overall inflation moderated in 2025, with official figures around the 2 percent range by year-end, while monthly data from the Central Bureau of Statistics (CBS) shows inflation fluctuating around roughly 1.7 to 2.5 percent through much of 2025. The CBCS has also reported moderation in inflationary pressures during 2025.
But construction is a special case because it is unusually exposed to imported inputs, shipping costs, and skilled labor scarcity. The survey indicates that companies expect construction material prices to keep rising in 2025, and many foresee significant increases in residential and non-residential construction costs, driven primarily by materials and labor availability.
This dynamic is also visible in broader global signals. International logistics and shipping costs have been flagged again as a risk factor in 2026, with supply chain instability and rising transport eeed into prices for goods and materials. For Curaçao, where construction imports are an unavoidable reality, even a modest global freight spike can translate into meaningful cost increases at local hardware suppliers, equipment importers and contractors.
Investment confidence remains, but financing uncertainty lingers
One of the most notable findings in the CBCS survey is that construction firms are not retreating. Many expect investment to increase in 2025, and a significant group anticipates sustained capital spending through 2030, indicating confidence that demand will remain.
That confidence aligns with the broader macro backdrop. Curaçao’s economy grew strongly in 2024, with CBCS estimates placing real GDP growth above five percent, driven by sectors including tourism and construction-related investment. However, CBCS has also projected that growth is likely to moderate over time as the post-rnto a more trend-like expansion rate.
For construction, the question becomes whether investment plans can be executed under tighter conditions. Access to credit and the cost of financing were repeatedly raised as issues by firms in the survey, with many reporting uncertainty about financing conditions going forward. That matters in an environment where project viability increasingly depends on accurate cost forecasting. When material prices are volatile and skilled labor is scarce, lenders and developers typically demand higher contingencies—raising total project cost and sometimes delaying decisions.
What this means for housing, infrastructure and competitiveness
The economic implications extend beyond the construction companies themselves. Rising construction costs hit households directly through higher prices for new homes, renovations and repairs. They also affect government budgets for roads, public buildings and essential infrastructure. Whltaneously trying to address housing needs, climate resilience and maintenance backlogs, a sustained rise in construction costs becomes a policy issue as much as a business issue.
The survey’s portrait of the sector points to three areas where targeted action could have outsized impact.
First, workforce development. If skilled labor shortages remain the dominant constraint, then expanding apprenticeship routes, modernizing vocational programs and creating faster certification pathways for trades could raise the sector’s capacity while improving wage prospects for local workers.
Second, procurement resilience. With heavy reliance on imported inputs, Curaçao’s construction economy benefits from better forecasting, consolidated purchasing and stronger logistics planning. Even incremental improvements in shipping coordination and inventory management can reduce costly work stoppages.
Third, financing and project readiness. Clearer pipelines for public projects, predictable payment practices, and improved access to credit—especially for smaller contractors—would help the sector execute investments without unnecessary delays and disputes.
A strong sector facing a defining test
Curaçao’s construction sector is growing, but it is doing so in a tighter environment where the limiting factors are no longer simply demand or ambition. The CBCS survey shows a market where confidence and investment plans coexist with practical constraints that can slow delivery and push costs higher.
The next phase will be defined by whether Curaçao can expand skilled labor capacity, reduce exposure to logistics shocks and ensure financing and planning frameworks keep pace. If those structural issues are addressed, construction can continue to function as a stable pillar of economic growth. If they are not, the island risks an outcome where activity remains high, but affordability and project execution become persistent challenges across housing, infrastructure and private development.